Declining state and local taxes added to the increasing cost of doing business has led to a shortfall in Sacramento County’s projected budget for next fiscal year. The County released preliminary information for the fiscal year 2010-11 on April 15, as well as a picture of what the possible impacts to programs such as Probation, Regional Parks, and Health and Human Services might be.
“This next budget cycle will be very difficult as we will be reducing levels of services and programs,” said Interim County Executive Steve Szalay. “We’re working to make budget recommendations that are equitable, achievable and that will impact the fewest amount of residents as possible. But the fact is we simply do not have the dollars to sustain services at current levels.”
The budget shortfall is about $166.5 million dollars, and reflects a perfect storm of decreasing revenues, payments due from past one-time budget remedies and increased salary and benefit costs; all at a time when demand for social services is extremely high.
“The only way to size our services to our revenues is through reducing our size and making small revenue increases where it makes sense,” Szalay said. “To get us through, we are looking at new business models for delivering services, and working to eliminate redundancies and inefficiencies throughout the County.”
They are also exploring more partnerships with non profits, such as the recent transition of the Senior Nutrition Services to the Asian Community Center non-profit. “It’s not enough to reduce; we must reduce wisely and position our selves for smart growth in the future, Szalay said. His goal is to make the organization nimble again, to be able to change and adapt as the economy rebounds. “We won’t grow the same way in the future – we may be hybrid of private, government, and non-profit,” Szalay added.
Since Fiscal Year 2008-09, the County has cut $212.6 million from the budget and 1,500 positions. The discretionary General Fund revenue (local dollars) decreased from $566 in 07/08 to a projected $476 for next year. This is about a 34% reduction in discretionary local funds, or about 8.25% of the entire General Fund, which is about $2 billion.
During the next few weeks, work will continue with departments and service providers to build a budget recommendation for the Board of Supervisors’ adoption during the week of June 14. “There’s still a great deal of work to do, but I’m confident, that if we make the changes we need to, we’ll be better for it in the future,” Szalay said.