Yolo County recently released the 2022-23 Recommended Budget which is due for consideration at the June 14 Board of Supervisors meeting.

The 2021-22 annual report was also released by the Yolo County Administrator. The recommended budget, which must be adopted as the county’s initial spending plan by state law, serves as the spending plan until September, when the adopted budget is reviewed, incorporating changes to the county’s funding. statement and results of operations for the current fiscal year.

The 2022-2023 recommended budget includes total expenditures of $667,609,455 with general purpose revenues of $92,904,788, representing a 5.4% increase over the general purpose revenues of the enacted budget of 2021-22. Capital expenditures are recommended at $30,453,982.

The recommended budget includes a total net decrease of 5.4 full-time equivalent (FTE) positions. It does this by adding 12.6 positions and reimbursing 1.0 positions in key areas, reducing 7.0 positions and 12.0 unfunded and vacant positions.

This recommended budget represents strong adherence to the Board’s long-term financial plan and provides for continued operations without requiring a reduction in services. While the overall budget has increased, the recommended budget for 2022-2023 provided only limited budget increases and carried over many for consideration in the enacted budget in September, based on the financial outlook at that time.

Total unfunded liabilities continue to grow and cause concern. The pension plan liability of $369,689,940 continued to increase. This cost increase is due to changes in CalPERS’ deemed investment income and the phasing in of a change in CalPERS from a 30-year amortization to a 20-year amortization for the payment of unfunded liabilities.

The retiree health liability continues to see reductions due to the continued efforts of the Board-approved pre-funding plan, with the most recent 2020 actuarial study showing an unfunded liability of $65,180,000. This is down from $153,091,000 in 2014, and an updated actuarial study will be completed for 2022. The road maintenance liability of $477,000,000 has yet to be settled. However, SB 1 has significantly boosted investments in road maintenance in the county, and the board has asked staff to explore possible additional revenue mechanisms.

“This time continues to be unprecedented for Yolo County,” Acting County Administrator Chad Rinde said. “The pandemic has generated significant economic disruption and initially created significant fiscal uncertainty. The ensuing recovery and significant economic stimulus has led to increased cost inflation and labor issues facing the county and the rest of the nation.

The county budget therefore adopts a measured tone acknowledging that inflationary pressures are now creating a situation where larger forces such as the Federal Reserve are working to cool the economy by raising interest rates,” Rinde continued. “The county is likely to experience a downturn as it relies heavily on property tax and sales tax which are crucially tied to the broader economy, and the county’s cost structure is not always able to adapt quickly to changes. So the county budget continues to invest strategically given that revenues in many areas are not growing at the same rate as costs and prepares for the next wave of economic challenges that will inevitably arise.

It should be noted that the county separately developed a plan for the $42.8 million in US bailout (ARP) funds. This funding, to the extent it is unspent, will be carried over to fiscal year 2022-23, and the process will continue to allocate and make project-level decisions for this important funding to respond and recover from the COVID-19 pandemic. These funds are available and can be spent between March 2021 and December 2024.

The recommended budget for 2022-23 is available online at: www.yolocounty.org/budget-finance. Instructions for participating in the June 14 hearing are available here: https://www.yolocounty.org/government/board-of-supervisors/board-meetings/board-of-supervisors-meeting-agendas-minutes.