Receive the 2019-20 3rd Quarter Budget Monitoring Report, adopt a budget resolution amending the 2019-20 revenues and appropriations, approve amendments to the 2019-20 Equipment List, and approve the Recommended Budget for fiscal year 2020-21. (General fund impact $87,160,489) (Blacklock/Qader)

1. Receive the 2019-20 3rd Quarter Budget Monitoring Report (Attachment A);
    
2. Adopt a budget resolution amending 2019-20 revenues and appropriations (Attachment B);
    
3. Approve amendments to the 2019-20 Equipment List (Attachment C);
    
4. Approve adjustments to the East Davis Fire Protection District 2019-20 budget as reflected in Attachment B, Exhibit 1;
    
5. Receive the County Administrator's 2020-21 Recommended Budget and input from other County officials (Attachment E);
    
6. Receive public comment and approve the 2020-21 Recommended Budget for the Health and Human Services Agency and Countywide Departments;
    
7. Approve the balance of the 2020-21 Recommended Budget and adopt the 2020-21 Recommended Budget resolution (Attachment F); and
    
8. Adopt 2020-21 Equipment list (Attachment H);

In Support of All Goals

I. 2019-20 3rd Quarter Budget Monitoring
Year-end projections have been developed by each department based on actual revenue and expenditure data through March 31. While County departments have incorporated the fiscal impacts of COVID-19 based on the best information available at this time, overall, most departments are projecting to end the year within budget, or with a surplus. The sections below highlight areas where significant variances from budgeted amounts are projected, or where budget adjustments or other actions are recommended. A detailed summary of the 3^rd Quarter projections for each department is provided as Attachment A. For those budget units where staff recommends a budget adjustment, it is noted in this narrative and also included in the budget resolution provided in Attachment B.
 
Countywide Revenues: General purpose revenues are projected to end the fiscal year approximately $520,000 over budget largely due to increased document transfer tax revenue of $361,600, sale of fixed assets increase of $121,500, and the receipt of a catch up payment for Springlake development fees of $421,810. These revenues are partially offset by lower than anticipated court revenues, sales tax and Transient Occupancy Tax.  Public Safety Proposition 172 sales tax is projected to be approximately $944,000 below budget due to the effect of the COVID-19 economic recession.
 
Agriculture: Agriculture is projecting to end the fiscal year with an overall surplus of approximately $424,000 primarily due to savings in salary and benefits and services and supplies. Additionally, the Rodent Bait Clean Up project will not be complete by June 30 and has been budgeted to be accomplished as part of the 2020-21 Recommended Budget.
 
The department’s IT Equipment Replacement fund is projecting service and supply expenditures to be $7,000 higher than budgeted in 2019-20 Adopted Budget based on the division replacing 4 additional computers than what is listed on the PC Replacement program schedule. The department is requesting to increase appropriations for services and supplies using Fund Balance to cover this expense.
 
The Building Replacement fund is projecting a surplus of $209,000 due to the construction of the modular building being placed on hold while other options are researched.
  
Staff recommends approving the budget adjustments as reflected in Attachment B to adjust Agriculture’s budget as described above.
 
Assessor/Clerk-Recorder/Elections: Assessor/Clerk-Recorder/Elections is projecting to end the year with a surplus of $405,000, which is primarily due to staffing vacancies in the Assessor and Elections divisions. These savings are offsetting reductions in anticipated revenue in both divisions. The Assessor division anticipates smaller revenues related to collection of miscellaneous fees, while fewer billable jurisdictions in Elections have led to an approximate $100,000 reduction in Election related revenues. Although the division is currently projecting to end the year in balance, the Clerk-Recorder’s division did see a decline in fees associated with services during the initial implementation of the COVID-19 Shelter in Place order. Staff will continue to monitor this area, and if needed a budget adjustment will be requested once final year-end amounts are known.
 
Child Support Services: Child Support Services is projecting to end the fiscal year with a positive net variance of approximately $393,000. The projected surplus is primarily due to salary savings since the department has not filled some of their vacant positions. The Department is waiting to fill vacant budgeted positions because the state is considering implementation of a new budget methodology that may affect future allocations and in light of the exploration of regionalizing Child Support operations with Colusa and Sutter County local Child Support agencies.
 
Community Services: The Community Services department is projecting to end the fiscal year with an overall surplus of $13.2 million, primarily due to delayed completion of capital projects and purchases of equipment in the Integrated Waste Management (IWM) division.
 
Road Fund Construction and Maintenance is projecting a $1.1 million budget surplus. This is due to a delay in the 2020 SB1 Rehabilitation and CR 95 Bridge projects which is partially offset by the reduced State appropriation received.
 
Integrated Waste Management (IWM) is projecting a $7.5 million budget surplus, primarily due to a delay in capital projects and equipment purchases, including the aeration system and blower and control.  The IWM Post Closure funds are projecting an overall surplus of $848,000 which is primarily due to pace of the closure of waste management units (WMU) 4 & 5. The project is progressing slower than expected and will not be completed prior to the end of the fiscal year so approximately $1.07 million has been budgeted in the 2020-21 Recommended Budget. The IWM Debt Service fund is projecting a surplus of $3.6 million which has also been budgeted in 2020-21.
 
The Cannabis Task Force is projecting a year end deficit of approximately $386,000, primarily related to a decrease in licensing fees due to fewer active cultivation sites compared to what was originally planned. The reduction in revenue is partially offset by a surplus in services and supplies. There is currently a fee study being conducted and the division plans to have the new fees updated in the fall when the assessment is completed, however, there is sufficient fund balance to mitigate any potential deficit in 2019-20.
 
In fiscal year 2019-20, Building and Planning had anticipated completion of the Agriculture Conservation Easement Program to mitigate about 50 acres of land, however, the project was not fully executed resulting in a reduction in use of fund balance. Within the Resiliency program, the SACOG charging stations and the CalRecycle project have both been delayed resulting in a surplus of general fund allocation. Code Enforcement is also projecting a surplus of $40,000 primarily due to savings in salary and benefits. However, Planning is projecting a deficit of $110,000 due to the significant reduction in Land Use Permit revenues related to the adoption of the Cannabis Land Use Ordinance (CLUO). This decrease in revenue was partially offset by a reduction in professional services, specifically outside consultants. Overall, the deficit in Planning could be offset by the surplus in General Fund allocation in Resiliency and Code Enforcement. Lastly, Building is expecting up to a 6.3% reduction in revenues related to Covid-19, however, the loss in revenues is offset by an equal reduction in expenditures.
 
Budget adjustments for these items are not being recommended at this time; staff will continue to closely monitor these areas and if needed a budget adjustment will be requested once final year-end amounts are known.
 
Staff recommends adopting the amendment to the 2019-20 Equipment list as reflected in Attachment C removing previously approved equipment for Integrated Waste Management.
 
County Service Areas:  Most of the County Service Areas (CSAs) and Assessment Districts are projected to end the year within budget or with a surplus; however, a few are projecting a deficit. North Davis Meadows-Water reflects both revenues and expenditures being significantly below budget due to postponement of the water consolidation project due to ongoing litigation related to the project since the lawsuit decision was appealed in January 2020. North Davis Meadows Sewer Fund is projecting a small deficit related to overstated revenues in a prior year which will be balanced by additional use of Fund Balance. Rolling Acres was dissolved in December 2019 and the funds will be equally dispersed to parcel owners at year-end. Wild Wings Golf Course is projecting approximately $146,000 in reduced revenues, specifically park and recreational fees, due to the golf course being closed for a period as part of Covid-19 business closures. To offset this loss in revenue, the district is going to use additional Fund Balance to cover any deficits at year end.
 
County Administrator’s Office:  The department is projecting to end the year within budget.
 
County Counsel: County Counsel is projecting to end the fiscal year with an overall deficit of approximately $64,000 primarily due to lower than budgeted revenue related to staff time being redirected towards Covid-19 instead of clients. The department is expecting to use the full amount of salary and benefits and services and supplies for County Counsel. Additionally, the full amount of services and supplies is also projected to be expended for Indigent Defense and Small Claims. The net positive variance in Small Claims is due to court fees the department received.
 
Countywide:  While most budget units within the Countywide budget are projected to end the year within budgeted amounts, Board Controlled Penalties is anticipating a sizable reduction in revenues at year-end resulting in a reduced contribution to the general fund. A budget adjustment is needed to modify the transfer of funds to the general fund. 
 
There are lower than anticipated revenues in the Superior Court, court collections including traffic school and parking fines and clerk recorder records and index fees as part of the justice collections MOU.  Staff will continue to monitor this fund, and prepare a budget adjustment for year end, if needed.
 
Development Impact Fee revenues are projecting to complete the year in surplus. These fees are collected as a portion of a development project for the purpose of offsetting the cost of public facilities in the area of the development.  The excess revenue this year is due to a payment from the City of West Sacramento for a 408-unit apartment home development. 
 
Cannabis Measure K funds are projecting higher than anticipated revenue due to increased cannabis tax collection efforts.
 
Staff recommends adopting the budget resolution in Attachment B to decrease operating transfer from Board Controlled Penalties.
 
District Attorney:  District Attorney is projected to end the year with a positive net variance of $242,200 due to salary savings, including $202,000 in the Prosecution – Real Estate Fraud division.   The DA’s Public Safety divisions are projected to have slight surpluses or very minor deficits, despite a reduction in Prop 172 revenue due to COVID-19 economic recession.  The projected Prop 172 reduction for the District Attorney’s office is approximately $189,000 and this is expected to be offset by lower than budgeted expenditures, mostly due to salary savings. The majority of the special revenue funds are projecting to be in balance.  While revenues are projecting a deficit, this is due to grant expenditures being lower than anticipated. 
 
The Multi-Disciplinary Interview Center (MDIC) exceeded expenditures by $100,000 due to increased professional services related to the KE Grant for emergency shelter.  This is a federal grant and all expenses are fully reimbursable. 
 
Staff recommends adopting the budget resolution in Attachment B to increase MDIC service and supplies and increase federal grant revenues. 
 
Financial Services: The Financial Services Department is projecting to end the year with a positive net variance of $279,000 which is primarily related to delays in filling vacancies in several divisions.
 
General Services:  One division within General Services is projecting to end the year with a deficit; Esparto Tuli Mem Aquatic Center is projecting a deficit of $111,000 due to lower than projected revenue and higher than estimated first year operating costs.  The revenue generated from the Prop 218 special assessment does not sufficiently cover the operating costs of the aquatic park, so expenses like project management and utilities, along with other services has caused a deficit. 
 
The Parks division has a surplus due to the Knights Landing Boat Launch project being continued past July 1. The project will carryforward the remaining funding for the project into FY20-21 for expected completion by the end of December, 2020. 
 
Innovation and Technology Services: The ITS department deficit is due to less billable work in their Department Systems division of approximately $212,000. The Department Systems staff has reduced their hours on county projects so they can focus on COVID-19 staffing at the Emergency Operations Center.
 
The Equipment Replacement fund deficit is due to more PC’s requesting replacement than originally budgeted.  Departments that did not purchase in FY18-19 are now being replaced in FY19-20.  Fund balance is planned to be used to fund the purchases. 
 
Staff recommends adopting the budget resolution in Attachment B to increase use of fund balance in the Equipment Replacement fund.
 
Health and Human Services Agency: The Health & Human Services Agency (HHSA) is projecting to end the year within budgeted amounts in all major programs.  This is predominantly due to the recently obtained ability to reallocate 2011 Realignment funds between the Protective Services Subaccount and the Behavioral Health Subaccount resulting from the State of California formally recognizing the department as an integrated and comprehensive health and human services agency. This new ability, combined with the existing ability per Welfare and Institutions Code § 17600.20 to reallocate funds between the social services, health, and mental health accounts of the local health and welfare trust fund, allows the Agency to allocate funds more flexibly to fund the programs that are most needed in the County, and could help to avoid a potential fund balance deficit in the core mental health fund. The Agency has initiated programmatic and fiscal reviews of behavioral health to ensure their long-term sustainability and reduction of reliance on these revenue transfers going forward.

The major positive variance within the Agency is due to the projected Medi-Cal Managed Care Rate Range Inter-Governmental Transfer (IGT) revenue of approximately $5,800,000 in the Agency IGT fund.  Per the County IGT policy, this additional revenue received in FY 19-20 will add to fund balance at the end of the fiscal year, and therefore be available for budgeting and spending in FY 2020-21.  This is the same process, where every year per policy, the department does not spend any IGT funds in advance of receiving the revenue due to the unpredictability of this revenue source.

The Mental Health Services Act (MHSA) fund is projecting to end the year with a positive variance of approximately $4,800,000 due to expenses coming in lower than budgeted in the Community Services and Support program. The major driver behind the variance is a number of programs in the 2017-2020 MHSA 3-year plan that either were not fully implemented or the size of the program did not grow to the original estimated levels. HHSA is currently finalizing a new 2020-2023 MHSA 3-year plan that will include a spend down plan for additional fund balance amounts.  The department is also working diligently to further analyze expenditures in the Core Mental Health budget unit to ensure all appropriate costs are funded by MHSA resources.

Public Health is projecting a positive variance of $2,800,000 due to increased realignment revenue related to our designation as a County Medical Services Program (CSMP) county. The corresponding expenditures have not increased proportionately causing the positive balance for the current fiscal year.

Social Services is projecting to end the year with slight budgetary savings in Homeless Services reflecting recent successful efforts to obtain new grants and state allocations for shelter support and emergency housing in hotels, motels, and other facilities to address the COVID-19 pandemic among the homeless population. The budgetary savings will be carried forward to use in fiscal year 2020-2021 as many of the funds came in advance of paying the motel invoices. Social services administration unit is projecting budgetary savings due to lower salary and benefits caused by vacant positions.

The department is also proposing the budget adjustments to appropriate an additional $678,717 from 2011 Realignment dollars and transfer to Mental Health Services. The department is also adjusting the 1991 Realignment revenue to budget $757,437 to transfer to Public Assistance Aid and Mental Health programs.

Staff recommends adopting the budget resolution presented in Attachment B
 
Library: The Library is projecting to end the fiscal year with a budget surplus of approximately $228,000, primarily due to savings from vacant positions at the Mary L. Stephens Davis Library.   The branches have been closed to the public due to Covid-19 which resulted in a reduction in revenues of $47,000 primarily related to Fines and Fees. There has also been a reduction in expenditures of $180,000 primarily due to decreases in Services and Supplies and a decreased need for Extra Help. 
 
The Gibson House Museum is projecting salary and benefit expenditures to be $5,929 higher than budgeted in the 2019-20 Adopted Budget based on calculations for the remainder of the year.
 
Probation:  Probation is projecting to end the year within budgeted amounts; however, anticipates a surplus in Adult Probation Services and Placement will be required to offset a deficit in Juvenile Detention related to the elimination of the Federal Office of Refugee Resettlement (ORR) grant.  At this time, in order to better reflect the elimination of the grant in the department’s budget, the department is requesting a reduction of budgeted expenses and revenues in the Juvenile Detention budget.
 
Additionally, the department is requesting to transfer appropriations for both revenues and expenses related to the Yolo County Office of Education MOU.  The budget for this program was placed in the department’s Administration unit, but is actually a component of the Juvenile Detention program.
 
The department has reflected reduced revenues related to expected Prop 172 funding reductions. Staff will continue to monitor actual revenues related to this funding source and will request budget adjustments through the Year-End process if needed.
 
Staff recommends adopting the budget resolution presented in Attachment B to reduce revenue and expenses related to the termination of the Federal Office of Refugee and Resettlement (ORR) grant and to correct the placement of appropriations related to the YCOE MOU.
 
Public Defender:  Public Defender is projecting to end the year with a positive variance of $210,000, primarily due to $148,000 of unspent Immigration assistance money originally approved by the Board of Supervisors in September 2018, and carried forward to FY19-20.  While the Public Defender had unanticipated building repairs and additional IT project work, those expenditures were offset by savings in training and travel and special department expenses related to the department's caseload.   
 
Sheriff: The Sheriff’s Office is projecting a net overall surplus of $3.2 million, with approximately $1.7 million due to the Sheriff’s special revenue funds. Public Safety Fund units, which are supported by the General Fund, are projected to end the year with a $1.3 million surplus. 
 
The surpluses in the Public Safety Fund units can be mostly attributed to vacancy savings.  Animal Services, Public Administration, Management, Patrol, Detention and Coroner all have had numerous vacancies throughout the year.  Since the COVID-19 Stay at Home orders, completing the extensive background checks has caused delays in the hiring process.  The expenditure savings have helped offset the estimated reduction in Prop 172 revenues of $566,000, an increase in overtime, and operational adjustments in Animal Services and Civil due to COVID-19 related closures.  Another operational effect from COVID-19 has been on Detention at Monroe jail.  Due to COVID-19, non-violent inmates have been released causing Detention to have its lowest inmate rate ever.  Pre-COVID-19 daily rates were approximately 327 inmates.  During COVID-19, the lowest average daily rate was 150 inmates and currently, the rate has increased to 190.  This has decreased the food expense, along with other operational expenses. 
 
The Small and Rural fund is showing a surplus of $1.4 million due to the delay in implementing the RMS/JMS software system.  The funds will carryforward to FY20-21 for the continuation of implementation. 
 
In FY19-20, Court Security was balanced using $543,000 in salary savings.  While they are projected to end the year with a $256,000 deficit, vacancies throughout the year have decreased the anticipated use of Public Safety contingency funds to fill the gap at the end of the fiscal year.
 
Contingency Appropriations: The table below reflects the balance of all contingency appropriations as of June 2, 2020.
 

Contingency Designation	Original Allocation	Amount Remaining as of 6/2/20
General Fund	$ 2,500,000	$ 704,708
Health & Human Services	$ 1,000,000	$ 510,000
Public Safety	$ 1,000,000	$ 1,000,000
IT Innovation	$ 300,000	$ 83,240
HHS Emerging Needs	$ 225,000	$ 0
Sustainability Innovation	$ 30,000	$ 30,000
Roads/Planning	$ 350,000	$ 0
Total	$ 5,055,000	$ 2,327,948

  
It is recommended that all contingency balances remain unallocated at this time to provide a safeguard against unanticipated events that may occur throughout the remainder of the fiscal year, such as funds needed for additional response to the COVID-19 Pandemic.  Any amounts that remain unspent at year end will carry forward to be appropriated as part of the 2020-21 Adopted Budget.
 
Fire Districts:
The East Davis Fire Protection District is requesting an adjustment to their 2019-20 fiscal year budget, increasing both revenues and expenditures by $45,653 for a contract with the City of Davis and supplemental funding to other agencies. The proposed adjustments are included as Attachment D.
 
Staff recommends adopting the budget resolution presented in Attachment B adjusting the East Davis Fire Protection District revenues and expenditures.

II. 2020-21 Recommended Budget
This County Administrator’s 2020-21 Recommended Budget staff report provides additional information to assist the Board of Supervisors in considering the budget. The Recommended Budget (Attachment E) includes a department-by-department review of anticipated revenue and expenditures, as well as information regarding the funded programs. The purpose of the June 9 Budget Hearing is for the County Administrator to present an overview of the Recommended Budget, and for the Board to make any adjustments deemed appropriate before approving it as the initial spending plan for the 2020-21 fiscal year.

State law requires the Board of Supervisors adopt a resolution setting the County’s budget each year, and prescribes the format required for such action. The 2020-21 Recommended Budget resolution (Attachment F) adopts and implements the initial budget for the upcoming fiscal year, as considered and amended by the Board of Supervisors during the budget hearings. This budget will provide appropriation authority until the 2020-21 Adopted Budget is approved in September. The Board may modify this budget at any time between now and the Adopted Budget hearing by a 3/5 vote. Following approval of the Adopted Budget, a 4/5 vote is required for most budget modifications.

Before approving the 2020-21 Recommended Budget, the Board may make revisions to the recommended appropriations, revenues and staffing allocations.  Exhibit 1 to the Budget Resolution summarizes appropriations and revenues by fund, department, and budget unit at the account group level. Within Exhibit 1 the 2020-21 Capital Improvement Program budget is summarized separately from the operating budget. Inter-fund transfers are subtracted from the total consolidated County budget to eliminate double-counting.
 
Approval of the Recommended Budget allows the County to begin the fiscal year with a balanced financial plan in place. As discussed further below, there are a number of items that are not included in the Recommended Budget, which staff recommends be considered at the Adopted Budget in September.  For the Board’s consideration, the sections below highlight the changes, challenges and risks presented in the 2020-21 Recommended Budget.
 
Budget Development
The Department of Financial Services (DFS) and County Administrator first updated the Board at the January 28, 2020 Board meeting, where the Board received a preliminary assessment of the 2020-21 Budget and adopted the Budget Principles. The Board planned to conduct the initial budget workshops on March 9 and March 10, 2020. However, on March 9, the meeting was canceled and instead the Board met to approve an Emergency Proclamation related to the COVID-19 Pandemic. On March 10, the Board received an update on economic conditions and preliminary revenue projections; however, that information was assembled prior to the fiscal impacts of COVID-19 and local shelter-in-place orders, which began on March 16, 2020, followed by statewide shelter-in-place orders on March 19, 2020. On April 7, the Board received an update on potential impacts to County funding streams as a result of COVID-19. In an attempt to quickly project the COVID-19 impacts, the County relied significantly on the UCLA Anderson school of Management forecast, which projected an initial economic decline of approximately 10% with normalization by the end of the 2020 calendar year. However, as time has passed, it is now clear that the COVID-19 pandemic and related recession will extend more than originally projected. Thus, revenue projections will need to be revisited as part of adopted budget and an additional significant decline in revenues will likely need to be incorporated. Incorporating these further adjustments at adopted will allow additional localized data on revenues to accumulate and will allow any further reductions to be incorporated with greater precision at that time.
 
As part of the budget development process, departments submitted their budget requests through the Sherpa budget system in February. Initial base budget requests exceeded pre-COVID-19 revenue projections by approximately $4.7 million. Projected revenue loss due to COVID-19 impact was approximately $8.4 million, which widened the initial 2020-21 Recommended Budget gap to $13.1 million. The Department of Financial Services and the County Administrator’s Office held budget review meetings with the individual departments in March and April, and discussed options to find potential budget savings to close the budgetary gap of $13.1 million.
 
In addition, due to the unique financial circumstances resulting from the COVID-19 pandemic, the County Administrator’s Office (CAO) invited department heads to form a Fiscal Headwinds Working Group to brainstorm strategies to balance the 2020-21 Recommended Budget. In the meantime, the Department of Financial Services and the County Administrator’s Office collaborated to finalize strategies based on the individual department budget meetings. A combination of the strategies produced by the Fiscal Headwinds Working Group, CAO and DFS were included to mitigate the impact of the revenue loss due to COVID-19 and close the budget gap. These strategies include:

• Defer all General Fund augmentations to adopted budgeted
• Limit new programs
• Adjust budgets to align with historical spending pattern
• Implement position review of vacant positions
• Eliminate unnecessary travel and training
• Reduce extra help
• Request JPA reductions in-kind
• Offer XTO to employees
• Increase fees where appropriate
• Use special funds in lieu of general fund
• Temporary reduction of OPEB Contributions (1%)
• Temporary reduction of Supplemental Pension charge (0.5%)
• Re-allocate general fund positions/cost to non-general fund sources

Due to COVID-19, the state of California is facing a $54 billion budget gap and the Governor’s May revise demonstrated that a more likely scenario is a reduction of 4.6% in taxable sales during 2019-20 during COVID-19 and a further reduction of 17.3% in taxable sales in 2020-21. As taxable sales are a key underlying source for general fund sales tax, public safety sales tax, and 1991 and 2011 realignment, this will be a key theme as we approach adopted budget and suggests we are in a deeper recession as a result of COVID-19 than originally contemplated and included in the revenue estimates in this document.
 
Budget Overview
 
The 2020-21 Recommended Budget is balanced, meets State appropriation requirements and aligns with the Board of Supervisors’ adopted financial policies. The County’s total operating budget for 2020-21 is $493.4 million, with a capital improvement budget of $45.6 million. The budget is comprised of multiple departments that funded by numerous funds, including the General Fund, Public Safety Fund, enterprise funds, and other special revenue funds. The table below provides a summary of the 2020-21 Recommended Budget.
 

	2018-19 Actual	2019-20 Adopted	2020-21 Recommended
Net Operating Budget	$402,310,868	$510,089,292	$493,428,239
Capital Improvement Budget	$33,270,022	$59,281,539	$45,660,000
Total County Budget	$435,580,890	$569,370,831	$539,088,239
Fund Highlights
General Fund Departments	$53,063,930	$75,336,658	$69,848,333
Behavioral Health Services	$39,263,581	$49,656,154	$47,450,965
Road/Transportation Fund	$20,281,434	$22,445,152	$31,788,301
Public Safety Departments	$92,799,742	$112,393,048	$107,262,108
Public Health Services	$15,354,789	$19,227,090	$17,667,097
Employment & Social Services	$102,177,830	$110,351,812	$112,747,226

 

Project	2020-21 Budget
2020 SB1 Pavement Preservation Project (CR99, CR102, CR22 & Town of Zamora)	$3,000,000
Bridge Replacement - County Road 95 over Dry Slough	$2,625,000
Bridge Replacement – County Road 29 over Dry Slough	$2,480,000
Bridge Replacement – Road 40 over Cache Creek	$4,000,000
Highway Safety Improvement Program (HSIP) Guardrail Project	$5,900,000
Madison Flood Mitigation	$300,000

Cannabis: The 2020-21 Recommended Budget for the Cannabis regulatory program is $2.5 million, a decrease of $328,000 from FY 2019-20. This decrease reflects a reduction of annual canopy fees received of approximately $910,000, which is partially offset by a significant increase in use of fund balance. In 2019-20, 56 active cultivators were budgeted; however, there are only 45 expected in fiscal year 2020-21. Other significant changes include a reduction in indirect costs and professional services. The consultants that were used to assist with the Cannabis Land Use Ordinance (CLUO) are still needed, but at a reduced level. A new fee study is scheduled to be completed in 2020-21 and the division is still working to use fund balance where appropriate to smooth the program and work toward a sustainable level.
 
County Service Areas:
 
The 2020-21 Recommended Budget for County Service Areas (CSA) reflects a $4.8 million decrease, primarily due to a reduction in the amount budgeted for the North Davis Meadows CSA water connection project. This project was included in the 2019-20 Adopted Budget; however, the lawsuit was appealed in January 2020 and litigation is ongoing. Other significant requests include the $217,000 Flood System Repair Project for the Snowball CSA to repair the levee patrol road. This project is State funded and was awarded in 2018-19.
 
General Government

Agriculture: Net County Cost $869,909
 
The Recommended Budget includes reductions of $17,500 in clothing and personal supplies, household expenses, special department expenses and transportation and travel.
 
The 2020-21 Recommended Budget for Agriculture reflects a total revenue increase of approximately $90,000 primarily due to license and permits, State and Federal appropriations related to California Department of Food and Agriculture cooperative agreements and unclaimed gas tax. However, charges for services have been reduced significantly related to the non-renewal of the CalTrans contract. Overall expenditures have also increased by approximately $90,000 primarily due to a general increase in salary and benefit costs. In relation to the loss of the CalTrans contract, services and supplies have been reduced, including building and equipment maintenance. Inventory has also been reduced since the department has discontinued Rodent Bait operations and no longer needs to purchase chemicals. The Bait Room Clean Up project was not completed in 2019-20 and has been budgeted in 2020-21, and is funded by available fund balance in the Ag Bait Clean Up fund.
 
The construction of a modular building on the existing premises to accommodate staff and seasonal workers was budgeted in 2019-20 Adopted Budget for $200,000. However, the building has been placed on hold while alternatives are researched following the acquisition of 100 West Court Street in Woodland.
 
The department’s requested budget included a promotion for an Ag & Standards Inspector but this request has been deferred until the 2020-21 Adopted Budget in September.
 
Assessor/Clerk-Recorder/Elections (ACE)- Net County Cost $5,316,067.
 
The Recommended Budget includes reductions of $44,500 in Service and Supply expenditures for the department.  Additionally, in an effort to balance the budget, the department’s request for a new Senior Administrative Services Analyst has been deferred to Adopted, and a vacant Assessor Clerk-Recorder Specialist II position is being held vacant.  Additionally, the department has requested to underfill a Managing Deputy Clerk-Rec-Assessor position with a Senior Elections Technician position which allowed the department to reduce expenses while simultaneously being better prepared for the 2020 Presidential Election.   
 
The Recommended budget also includes a $75,000 one-time increase in Elections reimbursement from billable jurisdictions for the 2020 Presidential Election and a projected $45,000 increase in Clerk-Recorder revenues related to recording fees, though adjustments to this amount may be required in September if current year-end actuals do not meet estimated growth. Additionally, the budget also includes a reduction of $183,000 in departmental Innovation Technology (IT) charges for the annual cost of the dedicated ACE IT positions that were added in FY 2018-19. This savings was originally intended to fund the aforementioned Senior Administrative Services Analyst.
 
Department of Financial Services (DFS)- Net County Cost: $4,264,568.
 
The 2020-21 Recommended Budget for Financial Services includes reductions to their Training and Travel budget by $25,000, and their Services & Supplies budget by $10,000. Additionally, an Office Support Specialist position will be held vacant.
 
The Recommended Budget includes $13,000 in Services & Supplies for annual maintenance of Internal Audit’s workpaper system. A request for $52,500 in one-time funding for a combination of Capital Assets and Services and Supplies purchases was also requested. These purchases included an envelope press for the Graphics/Courier division and services enhancements in the Internal Audit division. The department also requested two new positions (Senior Procurement Specialist and Administrative Services Analyst), as well as a request to make a limited term auditor permanent that is scheduled to end in December, 2020.  The Administrative Services Analyst position is intended for the Tax Collector division, and would be funded by Cannabis reimbursement revenues. These items are not recommended at this time and will be considered as part of the Adopted Budget in September.
 
Human Resources:  Net County Cost: $2,139,179
 
The 2020-21 Recommended Budget includes a 0.5 FTE position reduction and a reduced services and supplies budget. The annual increases in salary and benefits have been offset by these reductions. Human Resources budget has been programmed as part of the County Administrator’s Office in prior years and is now a standalone department. There is no significant change proposed in 2020-21 Recommended Budget other than the above-mentioned reductions.
 
County Administrator’s Office: Net County Cost $4,167,300
 
The 2020-21 Recommended Budget for the County Administrator’s Office includes reallocation of one vacant position, Manager Strategy and Operations, to a Planner position in order to support administration of the Yolo Habitat Conservancy, which reduced the General Fund expense associated with the prior position. The budget also includes a reduction in the Professional Services budgets in Water Resources division and the County Administrator’s Office.
 
The 2020-21 Recommended Budget includes a Federal Aviation Grant of $1,080,000 to fund the Airport drainage basin improvements.
 
Other programmatic changes include moving Human Resources into a separate Department and moving administrative oversight of County Service Areas (CSA) to the Community Services Department. In addition, Esparto Park administration moved under General Services Department (GSD) during 2019-20 and the Recommended Budget for the park is included in GSD Budget.
 
Board of Supervisors: Net County Cost: $2,306,731

The 2020-21 Recommended Budget for the Board of Supervisors includes the transportation budget adjustment to match the historical actuals, which resulted in budget savings of $20,000. Total expenditures reflect an increase of $122,000 mainly due to increased payroll cost. There is no significant programmatic change proposed for the next fiscal year.

County Counsel: Net County Cost $2,447,400
 
The 2020-21 Recommended Budget for County Counsel reflects a total revenue increase of approximately $181,000 due to additional attorney hours for Health and Human Services Agency (HHSA) to handle juvenile cases and a proposed $5/hour increase in the department’s hourly rate, which will be included in the Master Fee update on June 23, 2020. There is also a general increase in salary and benefit costs which is partially offset by a decrease in transportation and travel and services and supplies. The budget also includes a decrease of $115,800 in Indigent Defense related to a reduction in professional legal services.
 
Library: Net County Cost $554,862
 
The 2020-21 Recommended Budget includes reductions of extra help, special department expenditures and holding one Account Clerk II and two Library Assistant II positions vacant for the entire fiscal year. Based on these reductions, the amount of parcel tax money transferred from Measure A was reduced as well. The revenue received in Measure A is not fully utilized because of this reduction, which results in a contribution to Fund Balance. The Recommended Budget includes an increase in revenues, including property taxes and State Library allocation for another Family Literacy grant, and a general increase in salary and benefit costs, which are being absorbed through the reduction of staff as outlined above. Services and supplies have increased by approximately $545,000 primarily due to the Library now budgeting their full share of indirect cost plan charges, which is consistent with other County departments. To partially offset this increase, the department has reduced their special department expenditures account as well as receiving an increase in Net County Cost allocation.
 
The net county cost for the Library is $554,862, which includes $125,750 for the costs associated with the Limited Term Museum Curator position at the Gibson House Museum. The department expects to need the Museum Curator position for an additional two years (2021-22 and 2022-23) in order to meet the position’s objectives; however, the department has been applying for grants in order to offset the costs but none would fully sustain the position.
 
General Services: Net County Cost $3,497,289
 
In order to reduce departmental costs, the General Services Recommended Budget has deferred all general fund augmentation requests which include a Parks vehicle, various Facilities and Parks supplies and equipment, reduced Facilities Extra Help, unfunding a vacant Facilities Project Coordinator position and holding a Supervising Parks position vacant for 6 months. Additionally, with the assumption that Facilities maintenance work will not be heavily impacted by the current economic conditions, work order revenue was increased to be more in line with historical trends. 
 
While the Recommended Budget includes the deferral of all general fund augmentation requests to the Adopted Budget, it does include $603,000 for Facility projects to be funded from the Accumulated Capital Outlay (ACO) fund. Those projects include a new water well at the Justice Campus, replacement of the Community Services/Fleet roof and building paint, Sheriff administration building paint, County Administration building pergola repair and paint and various gutter covers throughout the County.
 
Not included in the Recommended Budget is the financing expense for the Trane Energy Services Agreement.  The cost of the financing for FY2020-21 is $233,564 and will be allocated to County departments based on an equitable method, to be determined, and will be included in the Adopted Budget.  The table below shows the annual County cost for the life of the financing term.   
 

Fiscal Year	$ per Year
FY 2020-2021	$              233,564
FY 2021-2035	$              864,190
Financing Total	$         12,362,226

 
The 2020-21 Recommended budget for the Parks division reflects a decrease in both revenue and expenditures in comparison to prior years, due to the expected completion of the Grassland Trail projects by the end of the 2^nd quarter and the Knights Landing Boat Launch by the end of the fiscal year. 
 
A significant change in the Parks Division for FY20-21, is the responsibility for the management of Tuli Mem Aquatic Center. Intended to eventually be a self-sustaining park facility with the use of Proposition 218 funds, the first year of operation has indicated the need for continued county support. The Cannabis Tax Expenditure Plan, which provides funding for the County’s Rural Community Investment Program to spur economic development or improve the health and safety of our community, is proposed to provide $150,000 to sustain operations for FY20-21.

Innovation and Technology Services:  Net County Cost $246,471
 
In order to reduce costs, all departmental general fund augmentations have been deferred to the Adopted Budget along with a reduction of travel and training expenses. Additionally, a staff time study has resulted in reallocating salaries from IT services to Telecom, to be funded with Telecom internal charges revenue. 
 
The 2020-21 Recommended Budget includes the addition of 0.5 FTE for a Web Design position, funded through ERP IT Charges. This position was originally shared with the CAO’s office and it has been recommended for the full FTE to be a dedicated web design position within the ITS department. For FY2020-21, this position has been filled at the 0.5 FTE level. The Recommended Budget also includes eliminating two vacant programmer positions that were to be 100% dedicated to Assessor Clerk Recorder Elections (ACE) and Probation programs.
 
The ITS budget also includes increases due to the on-going maintenance costs for the Okta multi-factor authentication network security support and operating system licenses for servers in our virtual server infrastructure. 
 
The Telecom 2020-21 Recommended Budget reflects the reduction of purchased services like AT&T nonstandard lines and Frontier phone services to be paid directly by the departments and the reduction of professional services from VOX due to the new AT&T phone system.  The budget also includes additional interest and principal for the new phone system. Telecom has requested the purchase of an Underground Locator, to be funded with Telecom fund balance. 
 
The 2020-21 Recommended Budget for ITS also includes a new System Administration position to provide support for the Infor system. As the County transitions from implementation of the Infor system to stabilized operation and maintenance, a more centralized structure is needed to provide ongoing system support and administration. Currently, system administration is provided from within a number of different departments, resulting in a fragmented approach that lacks efficiency and coordination. Beginning July 1, responsibility for administration of the Infor system will be consolidated under the Innovation and Technology Services Department. The new position is needed in order to provide dedicated system support for the various Human Resource Infor modules, which will bring much needed proficiency to system administration and free up department staff to focus on core responsibilities.

Law and Justice

Child Support Services: Net County Cost $0
 
The Child Support Services 2020-21 Recommended Budget remains unchanged from the 2019-20 Adopted Budget; however, the department was recently notified of a $340,000 reduction in Federal and State appropriations for 2020-21. The department has identified strategies for a balanced budget, which will be adjusted at the Adopted Budget in September 2020.
 
The significant budget adjustments for 2020-21 Recommended, other than general salary and benefit cost increases, include a 5% supplemental pay for the Business Services Manager and a Limited Term re-class of the Supervising Child Support Officer to Child Support Program Manager. The general salary and benefits increases are being absorbed through eliminating a Senior Child Support Officer position and various adjustments in services and supplies, such as building maintenance, leasing, professional auditing services, office supplies and utilities. The recent purchase of their current building will allow for savings in their facility expenses.
 
Over the last several years, Child Support Services has streamlined its operations significantly and cut costs by way of automation and downsizing without impacting service delivery. The agency is currently working with Sutter and Colusa Counties to regionalize its operations. Regionalization will allow Yolo County Child Support Services to leverage its efficiencies and offset its operational costs by cost sharing with other partnering counties.
 
District Attorney: Net County Cost $9,376,851
 
As part of the budget balancing solutions, all general fund augmentations have been deferred to the Adopted Budget, including replacement vehicles, a new DA Investigator, and promotions for existing staff. In addition, four vacant positions have been unfunded; a Deputy District Attorney IV, an Administrative Services Analyst, DA Investigator II and a Probation Officer. There are also additional salary savings due to holding a position vacant after a pending retirement. 
 
The District Attorney’s 2020-21 Recommended Budget includes promotions in Consumer Fraud Environmental Protection with the use of special revenue funds, the purchase of a vehicle in Special Investigations using funding from an Auto Fraud state grant, and a new limited term Programmer Analyst position in the Criminal Prosecution division funded by the Federal Electronic Suspected Child Abuse Reporting System (ESCARS) grant. 
 
Probation: Net County Cost: $1,650,049
 
As part of the budget balancing solutions, four positions are held vacant, including a Senior Deputy Probation Officer III, two Deputy Probation Officer II, and a Deputy Probation Officer I. Additionally, the department further reduced their Extra Help budget by $125,000.
 
The 2020-21 Recommended Budget also includes removal of approximately $6.5 million in expenses and revenue related to the elimination of the Federal Office of Refugee and Resettlement (ORR) grant program. In addition to the positions eliminated through termination of the ORR grant, the department has eliminated a vacant Administrative Assistant at Juvenile Hall, along with one vacant Deputy Probation Officer in Juvenile Probation Services. A limited term Deputy Probation Officer II has also been unfunded.
 
Staff recommends $90,000 to partner with HHSA to provide Clinician services for out of custody clients. The department has identified this as a service goal in 2020-21. Other significant budget adjustments include a reduction in revenues and expenses related to an MOU with the Yolo County Office of Education. An ITS position which was assigned to the department has also been unfunded for the 2020-21 fiscal year.  Additionally, the Recommended budget includes a $221,000 reduction in Prop. 172 revenues. Finally, the budget includes a $991,000 drawdown in available fund balances from the Community Corrections Performance Incentive, AB109 Planning, DNA Identification and Youth Offender Block Grant funds to bridge funding gaps.
 
The department also requested $74,000 in one-time funding for continued improvements to the newly occupied Historic Courthouse, and additional programming needs at the Juvenile Hall. These items are not recommended at this time and will be considered as part of the Adopted Budget in September.
 
Public Defender:  Net County Cost $8,356,905
 
All budget requests including staff promotions and employee recognition and engagement funding, have been deferred to Adopted Budget.  Additionally, the budget eliminates a vacant Immigration Attorney, reduces Extra Help and Service and Supplies, and increases the use of Revocation fund balance by $25,000 for increased realigned parole and post release community supervision tasks. These reductions are based on the limited options within the Public Defender’s office. Other than the Immigration Attorney that has been recommended for elimination, there are no other vacancies.  The Public Defender has committed to holding any vacancies should any arise between the Recommended and Adopted Budget. 
 
Sheriff:  Net County Cost $21,873,387
 
In order to reduce the department’s net county cost, general fund augmentations including new positions, replacement vehicles, training, and approximately $950,000 in equipment and supplies, have been deferred to the Adopted Budget and 13.25 positions across a number of divisions have been held vacant. See the Position table included above in this staff report for details. Additional reductions have been made in service and supplies of approximately $155,000 across multiple divisions.
 
In the Sheriff’s 2020-21 Recommended Budget, a number of Non-General Fund augmentations are recommended for approval. Animal Services has unfunded 3 Registered Veterinarian Technicians to be offset by an increase in a services contract with UCD for veterinarian services. Boat Patrol has increased their FY20-21 budget for the Surrendered and Abandoned Vessels (SAVE) grant to continue the removal, storage or disposal of abandoned vessels in the waterways. The Sheriff’s Civil Process Equipment special revenue fund is requesting to purchase Sirron, a replacement for the software that manages the Civil process. Sirron will manage court ordered notices and account for the collection and disbursement of money judgments as required by statue for the Superior Courts. The Civil division is also purchasing replacement PC’s and monitors, along with a high capacity printer, all to be funded with civil process revenue and available fund balance. 
 
Additional non general fund augmentations include three replacement vehicles for the Capay Valley Patrol, to be outfitted with license plate readers, with funds provided by the Yocha Dehe Wintun tribal government. The Inmate Welfare division has requested the purchase of a replacement floor scrubber with Inmate Welfare revenue. 
 
In FY20-21, the Jail Management/Records Management (JMS/RMS) upgrade project will be starting its second year of implementation with an anticipated completion date by the end of the fiscal year. Portions of the project were delayed in FY19-20 and those funds will be rolled forwarded into FY20-21 for completion. Funding is from Small and Rural revenues and fund balance that has been reserved for this project. 

Community Corrections Partnership (CCP): 
 
The proposed FY 2020-21 Recommended Budget for CCP is reflected in the following table
 
2020-21 Community Corrections Partnership Budget
 

Category	2019-20 Adopted	2020-21 Recommended	Change
Beginning Fund Balance*	$651,638	$1,498,260	$846,622
Base Allocation	$8,537,052	$8,369,955
			($167,097)
Growth Allocation	$507,598	$0	($507,598)
Innovation Fund	($50,760)	($19,193)	$31,567
Total Revenues	$8,993,892	$8,350,762	($643,128)
Total Resources	$9,645,500	$10,600,930	$955,430
District Attorney	$468,046	$454,331	($13,715)
Library	$13,998	$0	($13,998)
Probation**	$5,247,230	$5,298,275	$51,045
Public Defender	$155,931	$155,931	$0
Sheriff	$3,217,687	$2,884,939	($332,748)
Countywide	$58,571	$63,843	$5,272
Total Funding Allocation	$9,161,463	$8,857,319	($304,144)
Ending Fund Balance	$336,106	$1,743,611	$1,407,505

 Other Budget Assumptions and Issues
 
Risk of a Deeper COVID-19 Recession: The recommended budget revenues projections were developed in late March shortly after the start of Shelter-in-place orders and utilized information from a UCLA Anderson School of Management economic forecast. That forecast expected an approximate 10% drop in taxable sales during the April-June 2020 quarter with a rebound toward the end of the calendar year. As this was an early forecast, it has likely turned out to be too optimistic and more recent information in the Governor’s May revise projects a reduction of 4.6% in taxable sales during 2019-20 and a further reduction of 17.3% in taxable sales in 2020-21. As taxable sales are a key underlying source for general fund sales tax, public safety sales tax, and 1991 and 2011 realignment, this will be a key theme as we approach adopted budget and indicates that we are likely in a deeper recession as a result of COVID-19 than originally contemplated and included in the revenue estimates in this document.
 
Mandatory vs. Discretionary Program Review. As a result of the risks of a deeper COVID-19 recession as discussed above, the County is engaging in a process of programmatic review looking at mandated vs. discretionary programs for the Adopted Budget in September. This is a process that is common amongst counties in order to provide an organization-wide lens of the programs that are provided and where the organization has been mandated to either provide a program and where a mandated service level exists. In contrast, this process also helps to identify what programs are discretionary where the Board either has full control of whether to offer a program and to what service level. There also may be discretionary programs where the ability to reduce are limited once the county accepts grants or other funding to offer the program and there may be ongoing responsibilities required of the organization. The intent is to conduct this work during June, 2020 and bring back in late summer to a Board workshop. The goal of that workshop will be the identification of programs and areas that the board may desire reductions to help to close any gaps created by a deeper COVID-19 recession than was built into the recommended budget.

CARES Act Funding:  Through the Coronavirus Relief Fund approved by Congress, the CARES Act provided for payments to State and Local governments as part of the impact of the COVID-19 outbreak. Eligible local government was defined as those agencies with a population of over 500,000 and thus Yolo County did not qualify. However, during the Governor’s May revision to the State of California 2020-21 budget, it appears the State may pass through funding of potentially $22,568,000 to the County of Yolo. It must however be recognized that actual award of funding will not be known until approval of the State’s budget which at best would be around June 15, 2020 and this allocation would need to survive the legislative process. The County Department of Financial Services is developing a framework of the spending approach on eligible purposes which is expected to follow the order of (1) Reimburse for COVID-19 Response Costs to date as FEMA funding will no longer be available until CARES is exhausted, (2) utilize to continue County disaster response and prepare for possible second surge, (3) maintain discretionary response programs, and (4) contemplate capacity for additional response programs as fund allows. These funds have not been incorporated in the recommended budget at this time; staff will return to the Board in a separate action later in the year if funding is approved by the State. 
 
Cannabis Tax Expenditure Plan: In the current year the County is anticipated to generate approximately $1,200,000 in cannabis tax revenue. Pursuant to the County’s cannabis tax ordinance, staff drafted a recommended expenditure plan included as Attachment J. Of note, the proposed expenditure plan includes $500,000 in General Fund support to help mitigate the economic impacts of Covid-19 and proposed deferring funding Early Childhood Intervention and Prevention and Youth Development until the Adopted Budget when staff will have a better sense of the County’s fiscal outlook. Additionally, the plan includes $320,000 in unallocated revenues (a portion of which has not yet been realized). These unallocated revenues could be used to fund Early Childhood Intervention and Prevention and Youth Development at Adopted Budget or could be used to further augment the General Fund should the economic outlook deteriorate further.
 
This cannabis tax expenditure plan was shared with the Cannabis Ad-Hoc Subcommittee on April 28. The expenditure plan was then reviewed with the Cannabis Tax Citizen’s Oversight Committee on May 28. The Citizen’s Oversight Committee expressed significant concern with the proposal to defer funding for Early Childhood Intervention and Prevention and Youth Development until the Adopted Budget, and instead recommended that $200,000 be transferred from either General Fund Support or unallocated funding to fund $100,000 for both Early Childhood Intervention and Prevention and Youth Development.
 
Health & Human Services Emerging Needs Contingency: In 2002, Yolo County participated in the Pooled Tobacco Securitization Program, which resulted in creation of the Ceres endowment fund that is held by a trustee as collateral for the outstanding tobacco bonds. Under investment strategies approved by the Board in 2002 and 2013, funds are deallocated annually from the Ceres endowment fund and made available for appropriation as a Health & Human Services Contingency fund that may be allocated by the Board throughout the fiscal year to programs and organizations that support emerging health and human service’s needs. 
 
Due to the recession impacts, staff recommends that the Recommended Budget appropriate $225,000 from the Health and Human Services Contingency to partially support the Public Assistance Aid program. It is projected that due to the economic downturn amid COVID-19 the service need will rise significantly in 2020-21.
 
Rural Community Investments: The Rural Community Investment Program (formerly known as Rural Initiatives) was initiated in 2015 and serves to enhance economic development as well as health and safety for rural communities by addressing critical infrastructure needs in accordance with the strategic plan Safe Communities goal. As part of the County’s ongoing efforts to leverage and maximize discretionary revenues by matching or drawing down other potential revenues, the County and the Yocha Dehe Wintun Nation have met to discuss potential collaborative projects which would benefit the rural areas of the County and braid Rural Community Investment funding with Yocha Dehe’s Doyuti T'uhkama (State Tribal Compact credits) program. Requested 2020-21 Rural Communities Investment Program allocations will be considered as part of the Adopted Budget in September; however, given the recessionary environment the County may have limited ability to dedicate funding for this program at past levels.
 
Pension Funding: The 2020-21 Recommended Budget includes $42.7 million in employer pension contributions, an increase of $2 million from the 2019-20 Adopted Budget.  Employer contributions for 2020-21 were determined in the CalPERS Annual Valuation Report as of June 30, 2018. As discussed with the Board on several occasions, employer contribution rates have increased significantly over the past several years and are projected to continue increasing for the foreseeable future. These increases are driven primarily by changes in CalPERS’ demographic and investment assumptions, particularly related to assumed mortality rates and a lower targeted rate of investment return. The table below shows the projected pension rates over the next five years.
 
Employer Pension Contribution Rates
 

Fiscal Year	Miscellaneous	Safety
2020-21	30.4%	43.7%
2021-22	32.2%	45.9%
2022-23	33.6%	47.6%
2023-24	34.2%	48.5%
2024-25	37.7%	49.1%

• COVID-19 Recession
• COVID-19 Disaster Response costs
• Continued Pension Cost Escalation
• Homelessness Initiatives
• Flood Protection Planning and Construction

The Public Safety contingency of $1,300,000 represents 1.6% of Public Safety Fund operating fund expenditures. The contingency level is within the 1-3% required in the Board policy on fund balance and reserves. HHSA contingency is 0.2% of total expenditures which is below the policy minimum of 1%.  Ideally, this amount will be brought up to one percent at adopted budget.
 
Due to COVID-19 it is highly unlikely there will be additional funding in the Adopted Budget for additional contingencies appropriated in prior years such as Safety and Security or IT Innovation.
 
Items for Consideration in Adopted Budget

The Recommended Budget does not allocate funds to several areas which may need to be considered with the Adopted Budget in September. It should be noted that due to the current economic forecast, it is likely that total funding requests for the Adopted Budget will exceed available resources. The table below provides a summary of the items that may be brought forward for consideration in the Adopted Budget:
  

General Reserve Contribution to Restore to 6.5%	$            814,079
Increase General Reserve to 7.0%	$         1,973,319
IT Innovation Contingency	$            500,000
Other Contingencies	$         1,100,000
Financial Services Envelope Press (Graphics)	$             25,000
Financial Services Programs	$             14,000
Financial Services Security Improvements	$               7,500
Probation Building Improvements	$             30,000
Probation JDF Program and Staffing	$             44,000
Sheriff Staffing	$       2,584,401
Sheriff Vehicles	$           518,000
Sheriff Equipment & Supplies	$           951,664
Sheriff Programs	$           112,833
Sheriff Staff Training	$             64,067
District Attorney Vehicles	$           210,000
District Attorney Staffing	$           296,492
Public Defender Staffing	$             39,806
General Services Equipment & Supplies	$             34,500
Parks Vehicle	$             55,000
Parks Equipment & Supplies	$             92,550
Agriculture Staffing	$               8,288
Estimated Total for Consideration	$        9,475,499

All County departments prepared and submitted a requested budget for 2020-21. Department of Financial Services staff review and analyzed budget requests and budget discussions were held between the County Administrator's Office and each department. Budget updates were provided to the Board Chair and Vice Chair in Budget Ad-Hoc Committee meetings, and an update to the full Board of Supervisors was presented on April 7 and May 5. County Counsel has reviewed and approved the budget resolutions as to form.

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