County finds surplus in final budget for 2011-12

2012-11-20T18:14:00Z 2012-11-20T18:16:15Z County finds surplus in final budget for 2011-12PETER JENSEN Napa Valley Register
November 20, 2012 6:14 pm  • 

Napa County has closed the books on its most recent fiscal year with $4.6 million more than it anticipated, but the Board of Supervisors is in no hurry to spend it.

Following a recommendation from county staff, the Board of Supervisors on Tuesday decided to stash $2.8 million of the extra cash in its reserves, and will give $168,739 toward new offices for the county Agricultural Commissioner. The board is leaving the last $1.6 million as an unappropriated available fund balance.

Assistant County Executive Officer Britt Ferguson delivered the final report on the 2011-12 fiscal year to the board, saying the county’s financial outlook remains healthy.

Ferguson attributed the extra money to additional property tax revenue from the state educational revenue augmentation fund, and because the county refinanced some debt earlier this year to save on interest costs.

Its five major operating funds — the general fund, and the roads, library, fire and building and code enforcement funds — are in good shape, Ferguson said.

The building and code enforcement fund reversed a three-year decline by growing 33 percent to an ending balance of $820,122, which reflects a spark of building permit activity, Ferguson said.

That fund had suffered three consecutive years of decline, which was attributed to fallout from the U.S. recession and the sluggish recovery. Ferguson highlighted the recovery this year as a bright spot.

Ferguson also credited cost-cutting measures the county Planning Department has implemented, such as eliminating positions and preserving vacancies in others. If the revenue growth holds up, the fund should be back to its pre-recession level of $1.6 million in the next three to five years.

He said the county roads fund will benefit from a phase-in of roughly $3 million in increased funding over the next five years, which the board voiced support for earlier this fall. That money will be spent quickly on projects, and would help the county meet its goal of contributing $9 million annually toward fixing the roads.

The county estimates that it will receive $4.4 million from Measure T, the half-cent sales tax for road repairs passed by voters this month, beginning in 2018. Ferguson said the plan is to increase funding by about $600,000 each year until 2018, when the annual contribution would be $3 million. The county already commits about $1 million to $1.5 million annually from its general fund to roads.

Supervisor Mark Luce said he’d prefer to see more money spent on road repairs in the future, as it would be an effective way to prevent the costs of repairing the roads from ballooning. Costs increase exponentially as the roads’ condition worsens, he said.

“It seems to me that if we have any cash, this is the place where we should be spending it,” Luce said. “It’s time to put our money where it really counts.”

Supervisor Keith Caldwell said he’d also like to do that, but fears it would hamper the county’s cash flow as it gears up to pay for capital projects such as the new jail and the new health and human services campus, and extending Devlin Road.

Ferguson stressed the importance of maintaining healthy reserves as assessed property values in Napa County continue their slow trend of improving. Those values increased by about 1 percent this year, but most of the increase was attributed to inflation. A 1 percent rate is a far cry from the double-digit increases the county had seen in the past.

Once it begins to see 5 percent annual growth in those values, the county’s financial picture would brighten, he said. Until then, the county’s general fund is likely to remain as it is now, Ferguson said.

“Not a lot is happening in terms of new construction,” Ferguson said. “Eventually we’ll get there ... but it’s not something that’s going to happen any time soon.”

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(2) Comments

  1. rocketman
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    rocketman - November 20, 2012 6:57 pm
    I applaud the County for reporting this........most jurisdicitions will never do that. It is amazing when MANY government entities claim they are broke and then suddenly AFTER employee negotiations they FIND all this money......
  2. Cadence
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    Cadence - November 23, 2012 10:39 am
    It's also amazing when governments have a bit of a surplus and based on it, promise their employees forever salaries and retirement packages that can't be sustained without county funds increasing forever.

    The problem is the government also have periods of decreased income, but those periods are always a shocking surprise and the employee contracts have no mechanism to deal with government income decreases.

    It's fine by me, one of the providers of the "surplus" government funds, if some are set aside for the next (shocking) rainy day. Why not use the money to smooth those downturns rather than basing periodically unsustainable contracts on them, thereby causing great angst and pain?
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