At the May 17 meeting of the Riverside County Board of Supervisors, County Executive Officer Jeff Van Wagenen reported that at the end of June, the county’s projected deficit in discretionary funds for fiscal year (FY) 2021-22 would be $3 million, significantly less than the projection when the budget was adopted nearly a year ago.
He also organized a budget workshop at the end of the board meeting to discuss the schedule and plans for bringing the proposed FY 2022-23 budget to the board.
This is $50 million less than when the board adopted the budget last year. The reduction is the result of continued growth in revenues, such as sales and use taxes ($11.2 million), prior year and miscellaneous ($8.8 million), documentary transfer taxes ($8.3 million), Redevelopment Agency residual assets ($6.4 million), and motor vehicle in-lieu taxes ($5.7 million).
Also, the current estimate of the county’s reserves at the end of the fiscal year is $368 million, up $17 million from three months ago.
This quarter, Van Wagenen recommended a $2.2 million adjustment from the Contingency Fund. The board unanimously approved the budget changes at the meeting.
This fiscal year, the county has used $5.5 million of its $20 million set aside for contingencies. One of the largest adjustments was the November approval of $770,000 to augment Code Enforcement staffing for weekend work.
“This next fiscal year will bring challenges as we continue to align our county policy and budget priorities with our rising costs and limited financial resources,” Van Wagenen wrote in his request for the FY 2022-23 budget workshop at the close of the May 17 session.
In the workshop, he described the steps his office and county departments were taking to present the FY 2022-23 budget, which should be published about June 1. The annual departmental budget hearings are scheduled for June 13 and 14 and the final budget approval is anticipated before the end of June.
“In fiscal 2021-22, our costs continue to exceed our revenue,” Van Wagenen reported. “But as reported for the 3rd Quarter, we are moving into a better position as revenue increases.”
Next year, after nearly 10 years of deficit, Van Wagenen will continue efforts to create a structurally balanced budget. He told the board, “Our goal is to reduce that and ultimately eliminate that deficit.”
The 2022-23 revenue projection is currently $1.013 billion, an increase of nearly $40 million. Also, he anticipates that federal funding for pandemic fiscal problems will not be used to balance the budget.
Nevertheless, Van Wagenen mentioned several departments and issues that will need substantial revenue as the board reviews the new budget. For example, the surge in firefighting hiring will require an another $1 million, the Registrar of Voters estimated that implementing the Voters Choice Act could cost $2.1 million, and Code Enforcement will need another $500,000 to continue the seven-day work week approved last fall.
He mentioned that deferred or delayed maintenance could require $160 million over the next two years.
And importantly, the revenue estimates are still dependent upon the direction and strength of the nation’s and state’s economies.