More Cuts May Be Coming to the County, Despite Smaller Projected Deficit

Alameda County's projected $88 million budget shortfall for may lead to more cutbacks for 2012-13, officials said last week.

Alameda County faced a $138 million shortfall for the current fiscal year, which caused the county Board of Supervisors to eliminate 111 positions, and cut programs in health care, public assistance and public protection to close the gap.

Susan S. Muranishi, Alameda County administrator, said the prolonged recession ate into the county’s resources.

This year, with a smaller gap of $88 million projected for 2012-13, some tough decisions will have to be made, said , who represents Albany, Berkeley, Emeryville, Piedmont and numerous Oakland neighborhoods.

“This will require some very difficult decisions—decisions that no doubt
will further hamper our ability to deliver services that are very important to people in our community," he said. "And we must do so knowing that another round of bad news may be heading our way.”

A RANGE OF FISCAL CHALLENGES 

Muranishi said the budget gap reflects sluggish revenues linked to a slow economic recovery, costs associated with the state’s sweeping new “realignment” plan, growing employee health and retirement costs and other factors.

The projected budget gap was announced Wednesday at a meeting of the county Budget Workgroup, a committee of county-elected officials, department heads, community stakeholders (including labor, community-based organizations and the League of Women Voters) and concerned residents; the group meets regularly to help the county prepare its annual budget.

The county’s financial update comes as Gov. Jerry Brown continues to seek
$10.3 billion in budget reductions, which would widen the county budget gap due to planned cuts in state programs administered by local governments, including welfare and child care programs for low-income families.

Carson, who chairs the Budget Workgroup, said the large budget gap means he and board colleagues will have some difficult decisions to make before July 1, the deadline by which the county must approve a balanced budget for the coming fiscal year.

MORE UNKNOWNS REMAIN: REALIGNMENT, TAX INCREASES

But Carson said the projected deficit likely does not tell the entire story. Several pending factors could make more reductions necessary in the coming months.

These factors include public safety realignment, which shifts the responsibility for low-level adult offenders and parole violators from the state to local government, and the uncertainty of sufficient revenue to support this new responsibility.

While county officials are coming to terms with the fact that realignment will cut off some substantial sources of revenue, it's unknown at this point how much the state will reimburse Alameda County and other local governments for these new duties.

Carson said another factor is the fate of the governor's plan to ask voters in November to approve a series of tax increases to help the state close its own substantial budget shortfall—and prevent even deeper cuts to be passed on to local governments.

NUTS AND BOLTS

Wednesday's meeting came after officials from county departments and agencies detailed their anticipated financial needs for the 2012-13 fiscal year.

These needs are based on each department or agency’s estimated costs to
maintain services.

The projected budget gap is the result of a comparison of those estimated needs and the anticipated levels of funding Alameda County expects to have.

County budget analysts were directed to begin the process of preparing a list of options for closing the budget gap to develop a balanced 2012-13 budget.

The board will hammer out the final details of the budget at a series of public hearings in late June.

Alameda County is scheduled to approve a final budget by July 1.