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HomeMy WebLinkAboutM070981July 9, 1981 .81- ' RECONVENE: The Board of .Supervisors reconvened at 9;OO.a.m. pursuant to ~, ', recess. Present: Supervisors Dolan, Saraceni, Wheeler and '. Chairman Moseley. Clif Tickelson, administrative officer; ` Jim Johansen, auditor; and G1ark A. Nelson, county clerk, by Cathy Pitts, assistant clerk to the Board. Absent: Supervisor Lemke Pledge of A1~.egiance to the Flag of the United States of .America Invocation by Supervisor Saraceni 2030 PUBLTC HEARING: 1981-$2 PROPOSED BUDGET AND REVENUE SHARING FINAL USE HEARING . The public hearing on the 1981-82 proposed budget and revenue sharing final use hearing was held as advertised. C1if Nickelson, administrative officer, stated that most of what he had to say.was in the budget message in the front of the budget. The proposed budget reflects maintaining levels of services as in previous years. It has been two years .since the department heads were asked what -..'the felt was necessary .to run their departments. As a result of what the department heads felt and what theq reduced they were able to cut about $2.5 million. Even doing that there is a $6 million deficit. He asked that the Board take care to not over do making the easy decisions and easy cuts and thereby multiplying the problem for next year, which indicates it Gri11 be worse than this year. He felt the time had come to address cutting levels of service rather-~ than postp©ning the problems. His office could have broug~it back recommendations that would have brought the deficit to zero but would have doubled the problems far next year. Jim Johansen, auditor, set out the factors effecting the financial position. He had prepared a chart that indicate the years in which revenues exceeded expenditures. In those years the reserves were increased. In the first year of Proposition 13, 1978-79, and in 1980--$1 the actual cash expenditures have exceeded the revenues. One of the most significant factors in the county's position is slow growth of discretionary revenues. They have had a loss of discretionary revenue as a result of incorporations, annexations and RDA's. There was a decrease of $1.,5 million with the incorporation of Paradise; approximate loss of revenue in the amount of $200,000 in the southeast Chico annexation; possible annexation of the North Valley P 1aa.a of about $700,000 in sales tax.. There are two redevelopment agencies being proposed. The slow growth, in the discretionary funds deals with sales tax, for example. Last year they anticipated the sales tax at an eleven percent increase and t~came in about on the money. Another. reason why the revenue is not keeping up with expenditures is that the anticipated revenue is much closer to the actual estimates. Property taxes are y :anothe.'~^~area that is ineonsis'tent with other years in the -rate. of increase. In 1980-81 the increase.raas about seventeen percent; this year it is only about fourteen percent. That percentage was anticipated in-the proposed budget. It appears that the delinquency factor for property taxes in 1980-81 is at six percent which is higher than the rate in 1979-$0 of four percent.. He did. not know whether this was:an indication of the trend.. The gasoline tax revenue is down. In order to maintain .the road program additional discretionary revenue will be required. Since interest rates are so high, this also means that the money invested by the county =~.rRs`a higkier rate of interest. They have earned more interest than anticipated. Even thoug~i the interest rate is higher, the revenues will be declining.- The main factor of discussion deals with the decision made in the-state legislative levels. They do not Page 3_ 81- July 9, 19s1 have a final analysis"©f the bills that were enacted as yet. He felt .their figures were reasonably accurate. The Legislature had indicated the county would lose alcohol beverage money in the estimated amount of $31,000 that is in the budget: Financial aid to local agencies would b.e down by about $150,000- and with the program canceled then anticipated $200,000 less. The state is reducing their share of the SEIF, which is mloney from the family support program handled by the District Attorney which reduces the welfare aid portion. In the past, the state has contributed 27-3/"4 percent of every dollar saved in welfare aid. This would be an additional $76,000 decrease. The total of all those is a little aver $300",000. He felt that would be the minimum loss when they finally get. the information from the state. It was his opinion that the deficit will increase by that amount." In addition, there are added provisions to provide county match for the mental health programs and perhaps other programs. This will require additional county funds in the neighborhood of $200,000 or more. The provision requires that in order to waive the county match, the Board must hold hearings and set the information to the state, and they may waive the requirement of the match. Mr. Mickelsan felt it was a rather interesting situation in the health side of the budget. Any reduction in the level of services, and any decisions after the public hearings, can he sent to the state and they can override the Boards decision and send it back to the county. The Board will have to be careful in the health side of the budget. Mr. Johansen stated that in addition to the discretionary revenue decreases, there has been an increase in the levels of services or new services provided. This ties in with the incorporation of Paradise. With the exception of Public Works Department, there has-been no slow dawn in services by other departments since the incorporation of Paradise. This would mean an increase in the level of services to those in the unincorporated areas of the county. There have been a number of deputies and jailers added. This was an increase in the level of service. There has been an increase in demand with regard to the criminal justice system. There has been a major increase in public transit system, even though it is funded by restricted revenues. The same thing applies to the gas tax. This means there is less money available for road projects because of the bus system in terms of requiring more discretionary money into the road project. It does have an effect on the problem. The final primary source of the problem is the increase in the cost because of inflation. The charge for utilities in 1977-78 was $276,000 while in 1981-$2 it was $835,000. This allows far an-~.~.increase in the franchise revenues from PG&E. Those have not increased in direct relationship to the increase in cost to the county. There has been an increase in the cost of gas and oil -for Public Works and the Sheriff. Office supplies and everything in general has increased. There was increase in salaries and benefits as a result of inflation. As a result of lower discretionary revenue there was an increase in services and inflationary trend. In order to balance the budget, the county dug into the reserves a little bit. in the past. This gets the county by for one year and now the county is reaping that problem. The proposed budget for 19$1-82 goes of the chart. The budget is $5.6 million under financed. In elimination of the deficit, the county has to comply with state law and will sti11 end up in the situation of spending mare revenue than the county is taking in. For examgle, the Board might want to consider where the county would be now if the Board had not taken out the $1 million from the reserve last year. The problem that is being faced this year would be clos ~ to $1 million solved. Revenues are an important part of the fund balance available for the next year. In 1980-S1 this amount to about 13 percent of the total budget funded. If the Board reduces the reserve; there wi11 be more problem next year. Page 2` July 9, 1981 81- --Jul~r 4, 1981 - ---_-_-_ T=-- . s~-~_~_____-__ __~----___~. Mr, Johansen-read the goal for 1981-82 £rox~ the paper that had been submitted to the Board. The county wi11 b,e facing additional decreases from the state next year. There is a provision in AB 8 revised that if the state revenue drops below a certain level next year, they wi11 reduce the local revenue through.a factor. Getting by this year does not mean the county can depend upon the state. The proposed budget does not include provisions for salary increases except far the Sheriff and law enforcement personnel. He has done some rough projections for 1482-83 and the indications are that baring major increases or decreases in expenditures, they wi11 be facing financial tightness for a couple of years. The proposal that has been prepared does not meet the goal that he had indicated. The first proposal is to take $1 million out of the reserve. This would be transferring a portion of the problem to next year with the first two xecommendations. He felt there:. should be at least $2 million worth of meaningful reductions. Perhaps the county could then learn from this and next year develop a better method with community input and consultants for the long term problems. This proposal wi11 net solve the problem. Mr, Nickelson set out item 3 on the memo he had submitted to the Board. There are department heads that want to talk to the Board relative to this matter. He asked that the Board make general agreement on these issues. Item three refers to the reserve for contingency. They are proposing to reduce the reserve for contingencies by $1,000,000; the liability insurance by $300,000 on page 242 of the budget. Mr. Johansen stated that $300,000 reduction is the net reduction. Contributions to the self-insurance are made by departments and they are being charged premiums. Among the departments are grant funds etc. When the Board makes reductions of $500,000 of contributions to the fund, the effective reduction in the federal and state aid has to be reduced as we11. The net effect on solving the $5.6 million deficit is $300,D00. They are reducing the contribution to the fund by $500,000. Mr. Nickelson stated that for example, in welfare in order to get $1 from the department, they have to cut $10. This is the same thing with the workmen's compensation on page 294. There is the possibility they. are proposing a cutof $200,000. They will be talking about the possibility of more money in there. There is a percentage ratio to deal with in these funds. Judge Rix stated .that Board had a copy of his letter asking that the Oroville .justice Court remodel item be deleted. It would be nice and they could use it. He was reading the Los Angeles Daily Journal relative to the suggestion in Los Angeles of eliminating 21 civil courts. He was speaking for two justice courts in the county. He recognized the need to cut the budget even in the area of the courts, With that thought in mind, he went to Bl Dorado and Nevada Countie~rhere they have begun a program. He wi11 be subma.tting proposals to the Board in the hope that if they will not reduce expenditures, they wi11 hold the line,- There is an administrative hold on the position he requested. He would have to go along with that at this time because he will be coming back with a proposal. There wi11 be some things in the proposal. He realized that the court is not a collection agency but he wi11 have some ideas for more efficient collection of fines. When the proposal comes in there will be some reduction of services to the. public. Mr. Nickelson stated that the next two items relative to revenue sharing have to, do with the libraries. There is $400,000 in debt retirement and $360,000. inPaue ishings. The debt retirement is g ~' July 9, 1481 July 9, l9$1 81- not necessary. It can be taken out. The library furnishings could be put off and if for same reason the library is finished ahead of time the old furniture can be used. .He proposed that the $36O,OflO betaken out of the budget this. year. He was proposing that the $50,000-for road improvements and the $50,000 for sidewalks at county center be taken out of the budget. They are needed but he felt they could be deferred. That is a total of $1,060,000. The next item effects Public Works relative to taking out $1,.25,500 of the motor vehicle in--lieu funding that i.s on page S-4C. In 1979-80 the Board put $1,326,000 of the motor vehicle in-lieu funds into the general. fund. 'There wi11 be an impact on Public Works but wi11 not be that much greater than in 1979-80. Clay Castleberry, public works director, disagreed with that proposal for several reasons. The budget is $7.5 million this year and was $10.5 million in 1979-$0. The comment- in the newspapers was that there was a $4 million increase last year. His department deals with a great deal of federal funding, which is mare or less. This year`s federal funding is more than last year. There is $1.5 million this year far the Skyway project. He felt the Board had problems and that his budget could be reduced somewhat. His office has set an~example over the last three years. Tn 1979-80 the staffing was reduced by 15 percent. When Paradise was incorporated services were not needed and they reduced the building and road maintenance as well. He felt that was the way the county should operate. He wanted to participate and help balance the budget. He was a little upset that he did not know what was proposed until he found out today. He.would have liked to have had the information earlier than this morning. He had wanted to speak. He had wanted to speak to a disagreement with his budget but that problem was changed. They had asked that a CETA position be transitioned. He is now in agreement with that fact and will not transitiian the CETA people. He hoped the Board would agreed that $l.~ million was too much to take out of his budget. He could certainly postpone projects. Staffing has been reduced even though functions were not taken away from their department. He has not seen similar staff reduction in other departments when there was transfer of functions. He hoped the Board would leave at least $700,000 or $800,000 of the $1.~+ million far construction projects, some of which have been postponed such as the Lower Wyandotte project. He felt his office had operated in prudent management doing about the same functions for the people of the county. He even suggested lowering the snow plowing and agreed to try ta.do the work within the amount of the money available. They reduced their building staff by 35 percent. They may decrease the staffing a.little more. Mr. Nickelson understood Mr. Castleberry's disappointment as to the funding. He felt that Mr. Castleberry over-reacted to the budget proposals. Mr. Gastleberry has been aware they are proposing to take $1 million to $1-1/2 million in the motor vehicle in-lieu taxes. He did not appreciate the comments about being kept in the dark. He felt it was important to not react against each other during the budget session. As far as reduction in staffing, other than the building section, which was a self supporting function, the Public Works Department from 1979 through 19$2 reflect a reduction of 7-1/2 out of 10 positions,-which is about 3 percent per year. There was a 7% reduction in operations. Many counties put 100% of the motor vehicle in-lieu funding into the general fund. He recommended that the Board advise the department heads to go back and take a lank at their budgets and how they are funded. They could then come back with proposals to-the Administrative Office and Auditor`s Office on increment reductions up to 20% of discretionary funding Page ~, July ~9, 1981 July 9, 1981 81- a in their budgets. There will be some departments .where it is impossible to make any reductions whatsoever. He believed the problem was ,so serious that at least the Board would have current input on reduction by which the Board can make reductions as necessary. The Board could take those reports next week -after review by Administration and the Auditor and make policy decisions and start eliminating discretionary funding: He recommended that the department heads be given guidelines to go on. Supervisor Wheeler agreed with the suggestion. This should have been done when they were working on the budget. All the department heads have a responsibility to the taxpayers. The department heads are all asking for more than what is in the budget. Mr. Nickelson responded that this could not have happened a long time ago. The Board sets the level of service. Where the Administrative Office could have gone through and made massive cuts, they would have been putting in their personal ideas to take care of problems that goes beyond the domain of the Administrative Office to make that type of radical cuts to get the budget into balance. The department heads have a responsibility to provide services and in some instances their bonds are at stake to provide the services. The department heads do not know how much money is there. The department head knows the job he believes has to be done. This budget will have to be a tremendous compromise for everyone. A good example of adding positions by the Board, he was afraid the Board was going to add another $3,500 for the drug program. Where is the county going to get the money. It is not there. Mike Pyeatt, assistant administrative officer, stated that last year the Board was presented a decision package and it was not implemented. This year they did somewhat the same thing by requesting information to update the decision package. Some indicated there was little or no change. Supervisor Dolan felt maybe the county was a bit late. If this was appropriate procedure and if the Board needs to be faced with a balanced budget without tripling the problems next year this should be done. Mr. Nickelson has told the Board there is a financial crisis and an increase in budgets and services. The first decision package listed what the departments do and attempted to identify those legally required in 1979-80. It does not identify what was increased. Supervisor Wheeler felt that everyone needed to wank together in a joint venture. Jae Bandy, agricultural commissioner, stated that his budget was reduced by the Administrative Office 9.1%. After looking at the 20% cut, he will be looking at a 30% cut. The l0% will effect providing the existing levels of service. They are looking at people and at incoming revenue. If the Air Pollution Control was taken over by the ARB there would not be 1oca1 influence and concern. The ARB would have no trouble using local money to support ARB functions in Butte County. Several years ago the Board looked at using revenue sharing funds for Air Pollution Control. With permit fees, maybe they could develop the ability to pay for itself. If ARB took aver, they would transfer the functions, establish their own fees, handle their own Tnoney and observe penalties and fines. Mx. Nickelson stated that if that were to come to pass, the ARB would probably be issuing permits through-the state fire stations. Mr. Bandy stated he had mixed emotions about the Air Pollution Control. It is quite demanding. He felt it was important far local Page 5, July '9 , 1981 July 9, 1981 81- control to maintain air pollution control. There is no administrative cost ~ for the program. Tt would be a lot easier on hi-m personally if there were not the local control. Tt is not in the best interest of the county to turn it back to the ARB.. Mr. Nickelson stated that there has been. a request to fill the vacant position in Aix Pollution Control. Certainly, as the Board gets into these hearings, they wi11 run across innovative thought to escape the sword. He would be cautious when someone comes up with a comment that the budget is reduced by 12-1/2%. Mr. Bandy is talking about the 1z~-112% asked for that was more than what the Administrative Office gave in the budget. His budget is sti11 more-than it was. The departments should take leadership from Judge Rix. His budget was reduced by a considerable amount and he is going back to make more cuts. Mr. Bandy stated he did not say he would net and could not make reductions. He wanted to apprise the Board of the~~$oblems he has. Even though the budget was in excess of what i~.t had been, there has been an increase in revenue in excess of $50,000. He would be willing to work with everyone an this problem. ' Supervisor Saraceni agreed with the recommendation from the Administrative Officer. He felt the Board should ask the departments to come up with an analysis of cutting back even further. He felt it was important for the Board and department heads to work together. Maybe they should look at last year's figures and add a sma11 amount~~ta:it. Supervisor Dolan stated the message the departments heads should be receiving is not asking them to cut 20% and still do the same services. She was convinced that if there are departmental cuts, they will have to be dealing in reduction of services, programs or staff. Mr. Nickelson felt that the taxpayers have been fortunate because of the county departments and employees. They have worked hard and have produced. There is no way the county can get everyone to work harder and get the job done. Supervisor Wheeler stated in private conversations with the Grand Jury she has been told the people of Butte County are fortunate in the caliber of people and the administration of the department heads. She had a lot of faith in what can be done. Mr. Nickelson asked that the Board keep in mind that while the Board is talking about what a fine job the employees are doing. and that they should be appreciated, there is not one cent of any sort of increased salary adjustments or benefits or anything else far the employees. Tf that comes about, there will be an additional increase in the decreasing funds. Supervisor Saraceni wondered if the Board would be better to look at some of the larger cost departments first. Mr. Johansen stated he would prefer an earlier date than July 23, 1951 to consider the departmental proposals. The Board w~:11 be facing the decision on the library. He wondered if the Boards decision on that project would be effected in any way by what the department heads present. Mr. Nickelson knew that the suggestions from-the departments would not total $2 million that is needed. The Board will have to go through the budget page by page after considering the suggestions. There has to be cooperation from the courts as it relates to more efficient Page 6. July ~9 , 1981 _ - - JulY9, 1981 _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 81- ways to take care of some problems from the courts that go to county general $. fund costs. There is also the question of the homes for the W&I Code 300, 600. and 602 cases and the boarding-costs. Supervisor Wheeler suggested that a memo be written to the courts asking them to consider these areas very carefully. Supervisor Dolan. felt the Board should get the information of what is mandated, what is required and what.: are different ways to handle the requirements. The Board should also consider services that are not mandated services. Bob Crisan, welfare director, stated that he would like to add a problem to the considerations. Their .programs have not been funded by the state. They have no idea what the amounts will be. He believed the Health Department and the Mental Health Departments were in the same condition. Their budget may be different. It might show $22 million today and decrease to $20 million. Until-the allocations are received by the counties there is no way to finalize the budget. It is the responsibility of the state to provide the information to the counties. 2031 APPROVE TRANSFERRING OF FUNDS FROM CHICO MUNICIPAL COURT PROFESSIONAL AND SPECIALIZED SERVICES TO SALARIES AND BENEFITS IN THE COURT WORK REFERRAL PROGRAM Jim Johansen, auditor, asked-that the .Board take care of a technical problem in the budget. In the proposed budget the Administrative Office eliminated the Court Work Referral Program. This is an on-going program with staff on board. T here is a provision in the law that indicates if a program is not provided in the proposed budget the Auditor cannot issue dispersement for that program. The person is still on Board. On motion of Supervisor Wheeler, seconded by Supervisor Dolan and carried, the transfer of $2,b64 from the Chico Municipal Court professional and specialized services to salaries and benefits in the Court Work Referral Program was approved. 2032 PUBLIC HEARING: 1981-82 PROPOSED BUDGET AND REVENUE SHARING FINAL USE HEARING The hearing on the 1981-12 proposed budget and revenue sharing final use hearing was open to the public. Appearing: 1. ,lames Hanson. Mr, Hanson recommended that the Board do away with the central computer system and give each department individual computers to do their work, The employess are asking for more ~aages. He was not against employees receiving raises. He felt that the Board should consider the outside wages instead of going out of the county to compare wages. The Board should drop the wages by one-half and they would see how fast the employees came back to work. The government employees are the only ones that can afford paid vacations. The property tax is unconstitutional. There is a Grand ,fury proposing raises and other things, It is the duty of the Grand ,fury to protect people from government. They have been running in the reverse. The item addressed to the Board about more interest on their investment is more cost to the taxpayers. The builders cannot borrow money to build so the county can charge taxes on the buildings. 2, George Sclnwindeman of the Retired .f'aup.loyees Association presented a letter to the Board asking for a 5% increase for cost of living. Page 7, ,Duly 4, 1981 --_-_-__---_^July9,=1981==__=~________~____ gl_ -The budget hearing was continued to..Tu1y 17, 1981 at 9:00 a.m. $ with the department heads to have their proposals into the Administrative Office by 3u1y 15, 1981. RECESS: There:be~.ng,:nothng further before the Board at this time, the meeting was recessed,at 10;50 a.zu. to reconvene on Tuesday, July 14, 19.81 at 9 ; 0.0 a.m. Page $. ,Tu1y.9, 19$1