Lakeport >> County staff are cautiously optimistic about the 2015/2016 fiscal year.
The Board of Supervisors approved the final recommended budget with appropriations of all funds totaling nearly $204 million, an increase of a little more than 9 percent or $19 million compared to the 2014/2015 figure of about $185 million, according to Lake County Administrative Officer Matt Perry. The general fund appropriation is about $60 million, up from last year’s $55 million. More than half of the additional spending, $3.5 million, is money appropriated for response and recovery costs from wildland fires.
The bulk of the added expenditures for all funds is due to construction projects that include work on multiple county operated water systems, road projects and bridges. More than $6.6 million is allocated for capital improvements for the water systems, including the development of a community water system South Main Street/Soda Bay Road area south of Lakeport. Perry said assistance is critical to economic development investment in the industrial and commercial area. And more than $13.3 million will go toward road, sidewalk and 18 bridge projects around the county.
But while spending is up, so is some of the county’s revenue. Although money generated in some areas is still not at pre-recession levels, it has improved compared to recent years. Property tax revenue has increased about 2 percent since last year, according to the auditor’s office.
After what Perry describes as a drastic decline of sales tax revenue in the 2009/2010 fiscal year, it has appeared to stabilize at around $2 million per year — just 7 percent less than the amount collected in 2008/2009. Although it is still not near its peak at $2.4 million during the 2004/2005 fiscal year.
Perry said that while new commercial development could help pull those numbers up higher, he’s not yet ready to make any projections on an increase in the sales tax revenue stream.
The Transient Occupancy Tax (TOT) has also made a slight recovery since its low point of just $441,276 in 2013/2014. In California, the TOT is charged when a person stays in a room/s, hotel, inn, motel or other similar lodging for 30 days or less. The TOT amount collected during the 2014/2015 fiscal year was almost $572,312, a roughly 23 percent increase from the previous year. But the administrative office estimates the TOT collection in 2015/2016 will go slightly down to $564,800, amounting to $368,000 less than the total received in the peak year of the 2006/2007 fiscal year at $936,000.
Although the modest increase gives the county more leverage, Perry stated department heads and employees “will have to continue to closely monitor their expenditures to maintain balanced budget.”
Budget breakdown
Salaries and benefits account for roughly $76.2 million, making it the largest portion at 36 percent of the budget appropriations. Next is services and supplies at $66.4 million or 31 percent. The other charges category is at $27 million or 13 percent, construction in progress consists of almost $27 million at 13 percent of the budget. Fixed assets, other financing issues and contingencies round out the appropriations and are between 1 and 4 percent.
When putting together the budget, Perry said he and his staff kept in mind the Board of Supervisors’ priorities: developing a budget that’s sustainable in the long and short term, maintain general reserves, minimizing or avoiding service reductions and avoiding large layoffs or furloughs in order to balance the budget.
“Staff is aware of the Board’s commitment to make employees a priority in this year’s budget in acknowledgment and appreciation of their loyalty and sacrifices these past several years,” Perry wrote in his memo.
Perry also made a point to thank county employees for stepping up in staffing the Emergency Operations Center during fires this summer. While their response was necessary, fires prevented his department to dedicate as much time as in years past to the budget. Additionally, some key information was not made available to the administrative office in time for the final budget. Perry expects his staff to present additional budget recommendations later this month or in October.
