Economies in California and Napa County may be thriving, but county government is looking at tightening its belt.
County officials say the 2014 earthquake, the 2017 storms, the 2017 fires, rising pension costs, worker raises, the need for a new jail and a state transfer of In Home Supportive Services costs are taking a toll. County expenses could rise $30 million to $35 million in three years.
“Generally speaking, the county’s budget is very finely balanced and any shift in cost pressures, even small ones, could prove difficult to mitigate in the immediate future,” a county report said.
Napa County government provides such services as rural law enforcement, rural road maintenance, criminal justice, libraries, health and human services and rural planning for Wine Country development that now includes wildfire recovery.
One question is how much revenues might rise. For this current fiscal year, increases in the property tax, the transient occupancy tax and sales tax revenues are projected to bring an additional $9.3 million to the county’s $205 million general fund.
Supervisor Alfredo Pedroza isn’t counting on more of the same. The Board of Supervisors last week heard a financial presentation as a kind of opening round to figuring out the 2018-19 budget, with the fiscal year beginning on July 1.
“A concern I have is we’re not going to experience the type of revenue growth we’ve experienced in the past five or 10 years,” Pedroza said. “I think we’re reaching a point where we don’t have that type of capacity any more for growth. Consequently, our revenues aren’t going to grow that much.”
For example, he noted new hotels that bring in more transient occupancy taxes are being built in the cities, not the unincorporated county.
Napa County is proposing a number of ways to deal with the situation. Among them is implementing a hiring freeze, with possible exceptions.
A major coming cost is the new $128 million, 304-bed jail that the county intends to build along Highway 221 near the Syar quarry. It would replace the 264-bed downtown jail that county officials say is aging, too small and not designed for today’s inmate population that includes more gangs and mental health cases.
The plan to pay for a new jail includes taking out a $50 million loan, which would entail making annual debt payments of $4.2 million for 15 years. In addition, the bigger jail would cost an additional $3 million annually to run, a county report said.
In June, the county signed a deal with its largest labor union representing more than 1,000 employees that calls for raises totaling 10 percent over three years. That will add $6.7 million to the 2018-19 budget and $7 million to the 2019-2020 budget, a county report said.
Meanwhile, the county’s emergency savings are $3.9 million below the level required by county policy. If the county spends another $8 million for wildfire recovery and receives a 75 percent reimbursement from the Federal Emergency Management Agency, it is still short another $2 million, the report said.
“This is the type of information we need,” Pedroza said. “It’s not always rosy.”
The Board of Supervisors is to hold a 2018-19 budget study session on April 17. It is to hold budget hearing from June 11-13 and pass a budget on June 19.