Placer County Budget Planning for2010-2011 Begins
February 23, 2010
After taking an early look at a challenging budget prognosis for fiscal year 2010-11, the Placer County Board of Supervisors began laying the groundwork Tuesday for developing a balanced budget.
For the third straight year, board members reviewed information about continuing economic decline, which has reduced property and sales tax revenues at a time when both the demand for services and costs have increased.
“Over the past several years, the Board has taken many proactive and prudent actions to rein in costs and maintain the fiscal integrity of Placer County,” said Thomas M. Miller, County Executive Officer.
“For example, between 2008/09 and 2009/10, they decreased the General and Public Safety fund budgets by $31 million. Members of the PPEO, managers and confidential county employees took 12 days of work furloughs to help cut costs. Other cuts also reduced other funds.”
“As a result of early, prudent actions, the County has been much better positioned to face these lean times than many other jurisdictions. However, for this upcoming 2010-2011 fiscal year, the county faces a $23 million shortfall due to further decline of county revenues, and it is uncertain what impact the State actions will have on our county budget. Preliminary planning will help us begin additional cost-cutting measures as soon as possible.”
Early actions the Board agreed to on Tuesday included:
- Approving preliminary direction to develop the 2010-11 Placer County budget as outlined in the board memorandum;
- Approving labor adjustments beginning July 1 for management team members, including no cost of living increase, nine days of mandatory time off and increased health care cost sharing. Managers, who are not represented by a union, had voted informally for this proposal in January;
- Directing the County Executive Officer to re-engage the Placer Public Employee Organization (PPEO) to discuss options for comparable labor adjustments for PPEO-represented employees, and discuss employee layoffs;
- Affirming the county’s current policy direction for county actions such hiring restrictions, use of extra help, overtime practices, communication utilization and fixed asset purchases;
- Providing direction to the County Executive regarding the suspension of merit increases for all employees;
- Directing the County Executive to return to the Board with further development of concepts for long-term structural changes before the end of the fiscal year.
However the Board of Supervisors decided not to delegate layoff authority to the County Executive Officer, agreeing to defer consideration of this action to a future date. This decision came as part of a request from several countywide elected officials who asked the decisions be deferred for further review.
“As in the past few years, balancing our budget while continuing to provide the highest possible level of service to taxpayers remains our Board’s priority,” said Chairman Kirk Uhler. “Doing so will continue to require cooperation from all departments and at all levels. Our Board is appreciative of the willingness to embrace this challenge shown by the management and confidential employees, and looks forward to working with the Placer Public Employees Organization and the Deputy Sheriffs’ Association to keep Placer County on stable fiscal ground.”
Earlier in the day the Board had also asked for a review of the merit increase process and asked staff to identify all merit increases granted. Of the estimated 740 merit increased approved for this fiscal year, approximately 73 were for management and confidential employees and 667 were for members of the Deputy Sheriffs’ Association and Placer Public Employees Organization. By ordinance, merit increases for the Deputy Sheriffs’ Association and the Placer Public Employees Organization are approved by the Civil Service Commission.
“Our potential solutions for next year’s budget include the continued prudent use of reserves, ongoing operational reductions, and reductions in labor costs,” Miller said. “Through careful planning and retooling for the future, it is expected that our budget will be balanced and will continue to fund the essential services that are most important to our constituents.”
Beginning in 2006-07, the County recognized the economy was facing an uncertain future and took several steps to advance plan for the future and pro-actively began to constrain costs and reduce expenditures. Since 2007, in response to significant reductions in property taxes, sales taxes, interest earnings and state funding the Board of Supervisors has:
· Reduced county staffing by about 10% - 258 employees – through a hiring freeze and attrition, avoiding over $19 million in salary and benefit costs;
· Implemented a 5% equivalent salary reduction from 12 day work furlough in 2009-2010 for all employees who are management, confidential or members of Placer Public Employees Organization;
· Reduced travel and training expenses, deferred or denied purchases that were not essential, and otherwise cut operational costs.
Placer County has avoided layoffs while many other jurisdictions in the region have laid off hundreds of staff. The only exception occurred in July of 2008, when the declining housing market in Placer County resulted in a decreased workload for building inspectors, and eight building employees lost their jobs.
“The next several years will certainly require new thinking and new ways of doing business, providing services and new service delivery models,” Miller said. “We will continue to protect our most important services and likely a smaller number of staff, but it’s clear that cuts will be necessary.”