As costs escalate and revenues remain flat, multiple Trinity County department heads said during last week’s county budget hearing they will continue to squeak by in the 2020/21 fiscal year, but there will have to be staff cuts and reductions in services next year if tax measures on the Nov. 3 ballot aren’t passed by county voters to increase the revenue side.
Those measures include a general cannabis cultivation tax that would provide new revenue to the county’s general fund if approved by a majority of voters, and a special half-cent sales tax increase dedicated to funding law enforcement activities if passed by a two-thirds vote.
The annual county budget hearing was held Wednesday, Sept. 9, by the Trinity County Board of Supervisors that listened to comments by several department heads and heard a detailed presentation on the county’s finances from its accounting consultant Craig Goodman before unanimously accepting the recommended budget without changes. The budget was adopted Tuesday during the board’s regular session.
The total 2020/21 budget including all enterprise and internal service funds, dependent districts and contingency is $134,738,679. The general fund component is $26,401,847 which includes $10,976,122 in discretionary revenues plus a cash balance carryover of $4.5 million. The budget includes a contingency fund of $443,859.
The new budget reflects a $2.2 million one-time increase of state funding above last year’s budget to complete the new county jail construction. The total increase is $3.4 million and aside from the jail funding, the main factor is a $1.2 million increase in salaries and benefits that will continue to trend upward over the course of five years.
Costs of salaries and benefits include higher premiums due to increased insurance rates and contractual obligations to the county’s employee bargaining units. Salaries/benefits comprise 30.8 percent of the total budget, but 63 percent of the general fund.
County Administrative Officer Richard Kuhns said all available revenues have been appropriated, and the budget ensures payment of all debt service while fully funding the county’s required annual contribution toward future retiree benefit costs.
Within the general fund, he said requested expenditures exceeded anticipated revenues by $5,839,482. The shortage was balanced by using a combination of cash carryover ($4.5 million); expenditure cuts of $996,199 and revenue increases of $343,283. Major cuts to any single department were avoided.
Goodman said Trinity County libraries, rumored to be closing due to cuts, will receive consistent funding in this year’s budget at about $400,000.
“We had a discussion about the severity of the situation, but we had no intention of cutting libraries. We are discussing reopening to normal hours starting next week, and in fact, they will be the only county office open to the public,” said CAO Kuhns.
At least half of the total discretionary budget is going to law enforcement functions provided by the Sheriff, District Attorney and Probation departments.
Goodman said the budget for the new jail, expected to be ready for occupancy by next March, includes funding for additional staffing to meet state mandated ratios. Asked how much additional revenue he is looking for “to get departments whole and where they want to be,” Goodman said it will take at least $2 million ongoing revenue for the next five to seven years, “and I’m not sure that’s enough going beyond that.” The estimated revenue from a half-cent sales tax increase is just $535,000 annually.
In addition to the two tax measures on the upcoming ballot, he is also working to complete a county fee study for the board to consider at mid-year to substantially increase charges for services provided by the county. If tax measures are approved in November, revenue projections will be prepared allowing for budget adjustments at mid-year.
“This budget is one we really need to monitor for revenues. If they aren’t coming in as forecast, there may be more cuts,” Goodman said.
Sheriff Tim Saxon had requested $2.8 million for the Sheriff’s budget of which $2.2 million was funded and $3.2 million for the jail of which $2.8 million was funded.
Saxon said his department worked diligently to ask for only what was absolutely needed “to provide the best public safety we can, minding we are opening a new jail and have to provide increased staffing to operate with safety to inmates and staff in there, and a new dispatch center to handle emergencies such as we are today with the best possible, updated equipment we sorely need for communications.”
He said the county’s budget committee “was open and understanding, questioned us diligently, in-depth and very fair. The budget we ended up with is very fair.” He said if additional revenue becomes available during the year, he could use $50,000 for extra help to cover when staff is sent to training programs; to finish maintenance projects at the Hayfork substation; and to complete a flooring project at the county animal shelter “to protect the public as well as the animals we house there.”
Saxon noted that anyone listening to the county’s budget hearings over the past few years is aware of the flat revenue stream “getting flatter by the moment. The pie keeps getting smaller and costs keep growing exponentially. If our revenues don’t increase by next year, we will see reductions in staff, equipment and training mandated by the state, reducing the level of service we are able to provide the public.”
He added that “nobody likes taxes, but we need to consider how to increase our revenue streams coming in.”
Trinity County’s interim District Attorney David Brady echoed the sheriff’s comments, saying as soon as he looked at the proposed budget, he saw the “very great danger of a flat line income stream. Right now, the DA’s budget is at bare minimums. Prices are increasing rapidly and revenue is flat. If the budget remains where it is now, I don’t believe we will be able to provide the quality of service the DA’s office has been contributing this year.”
Director of Planning and Building Kim Hunter stayed on theme, saying some of her departments “are already so far behind in work and staff including Planning and Environmental Health. Our fees are so low, we need to increase them and our revenue to tackle delayed projects.”
However, she said she is grateful for the needed funding this year to fully staff all cannabis and general planning positions, including a senior planner that has long remained vacant.
Chief Probation Officer Tim Rogers said he believes in hoping for the best, but planning for the worst, but he sees the recommended budget as doing the opposite: hoping for the best and planning for the best.
“Probation handles some of the most high-risk threats to public safety and our officers have started fixing the broken path by fixing an overcrowded jail, but even with a new jail, we must ensure we don’t just fill it to capacity and end up where we’ve been,” he said, adding the county needs to invest in pre-trial programming to assess risks, work release programs and others that are highly effective and commonplace in other counties that Trinity County can’t do for lack of resources.
He also predicted probation costs will rise substantially next year as the state shifts more costly mandates down to the counties to pay for.
Treasurer/Tax Collector Terri McBrayer said her office is already “at a breaking point” due to an extended leave of one employee, “and we really hope those tax measures are approved because we cannot sustain what we have now and continue to provide services.”
Human Resources Director Shelly Nelson said rising salary and benefit costs are built into future budgets through contractual employment agreements made with employee bargaining units, “and I have to recover those through indirect costs charged to the other departments. If I am unable to do that, I have to request it from the general fund.”
Health and Human Services Director Liz Hamilton said the budget does not yet include $3 million the county expects to receive as COVID-19 assistance to help pay for the county’s response team’s efforts, supplies and testing.
Sup. Keith Groves asked to question the budget department by department, beginning with the cannabis division of the Planning Department “because every year we hear questions about where the (cannabis licensing fee) money went by people who never seem to attend this meeting.”
The anticipated revenue this year from cannabis fees is $2,066,500 which is an increase of about $400,000 over last year. Total revenue expected from all sources is $2,153,750 while total expenses are budgeted at $3,185,386 for a net negative of $1,031,636 to be covered by the general fund.
Planning Director Hunter said most of the cost is for staff: planners, administrative assistants and code compliance specialists. Code enforcement officers are funded separately through the Sheriff’s budget.
She noted the recommended budget covers a fully staffed cannabis division which will be the case beginning this week. Other costs include public noticing/publication on projects and requested variances; travel for code compliance and inspections; and the addition of a modular building because the department has run out of space.
Groves stressed that no cannabis money is being used to fund non-cannabis programs.