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By Chris Frost
Tri County Sentry
Ventura-- The Board of Supervisors' preliminary budget discussion continues with the county's ability to maintain its long-term AAA credit rating from Moody's and Standard & Poor’s.
Chief Executive Officer Mike Powers said in 2020, the county undertook a long-term refinancing of its hospital bonds which saved about $34 million in net present value and $2 million annually in debt service savings for Ventura County Medical Center (VCMC).
"There are positive results on our TRANs borrowing (Tax and Revenue Anticipation Loan)," he said. "It's a .15 annual interest rate and annual savings from this program is $6 million for the general fund."
The county has added 837 FTE (Full Time Equivalent) positions to the budget, or a 9.3 percent increase from the Fiscal Year 2020-2021, bringing the total to 9,850 positions.
"Non-general funds are where the majority of those are," he said. "In the general funds, it is about 1.5 percent."
At VCMC, he said the county is adding FTEs mainly related to clinic integration, nine additional firefighters, 44 people to public health primarily related to Epidemiology and laboratory capacity, which is mostly funded through a state grant.
"We also know that mental health is a priority for your board, so we are recommending the addition of two attorneys to support mental health and diversion programs," Powers said. "There will be six additional positions in the public defenders' office, including four attorneys to support mental health diversion programs."
The county is also adding five employees to the Resource Management Agency (RMA) for general plan and long-range planning activities and assistance with public record requests.
"In our office (CEO), we're adding 11 positions, and seven of those are dedicated to new positions from the VCMC integration," he said. "We're adding some additional capacity to our diversity equity and inclusion efforts for some much-needed community support and sustainability."
The county is adding two positions in the Ag Commissioner's office, one Labor Relations Assistant in Pesticide Use Enforcement to manage the Sustainable Lands Conservation program and implementation of the General Plan programs.
"For the sheriff's office, we're recommending adding one position to support disaster preparedness in the office of emergency services," he said. "In the medical examiners' office, we're recommending you add two positions. One is a pathologist, and the other is an additional medical examiner."
Powers proposed adding one position to the county clerk and recorder's office because of the ongoing increase in operational workload.
"In addition to the current recommendations, we have three post preliminary recommendations, starting with the addition of a general fund contribution of up to $2.1 million to fund uncompensated cost," he said. "We're staffing the seven remaining inpatient beds at the VCMC inpatient psychiatric unit. We know it's a priority of your board, and I know there's a tremendous shortage of inpatient psychiatric beds in the county."
He also recommends adding an additional position for the Farmworker Resource Program and fully funding the program going forward.
"Your board has also highlighted the importance of supporting local businesses with fee waivers, particularly in our RMA Department," he said. "We have already included a 50 percent reduction in certain fees for food facilities and body art. With direction from your board, we will be bringing a board letter back in the next week or two, giving you an estimate of the total cost. The 50 percent was about $2.3 million, and the impact of going to 100 percent for those fees is $3.6 million. We will be prepared to fund that through our general fund, but we will also evaluate funding that through the American Rescue Plan."
Kay Mann from the CEO's office reviewed the general fund balance allocations, and she said the last time they brought this item to the board was at the end of March.
"Balances were at $211 million, and since then, we've had some adjustments that have increased the balances by $22 million," she said. "We have a decrease of $2.25 million that relates to the revenue lost to the RMA due to the fee waivers. Since that is a one-time revenue loss, we'll fund it through program mitigation. As we begin the fiscal 22 budget, the balances are estimated at $232 million."
The county will also receive funding from the American Rescue Plan, and they expect to receive $164 million of one-time funding.
"Separately, our 10 cities will be receiving about $140 million in funding as well," she said. "The first of the $164 million is expected to be received before the end of the current fiscal year. The second half is expected to be received within 12 months of the first allocation. These funds must be allocated by Dec. 31, 2024. That gives us a fair amount of time to review what we want to use them for and spend them. We have until Dec. 31, 2026, to spend the funds."
Mann said the county is still waiting for final guidance from the Department of the Treasury as far as the eligible uses.
The funds can be used to support public health response, address negative economic impacts, and replace public sector revenue.
"Premium pay for essential workers is mentioned as an applicable use, as well as infrastructure for water, sewer, and broadband," she said. "We'll continue to review the guidance until we receive the final guidance. Then, we'll come back to your board and decide how your board would like to allocate those funds."
She said the American Rescue Plan includes funding for emergency rental assistance, $20 million for round 2, $15 million for community health centers, additional funds, $5 million, for homeless assistance, and $1 million for the Older Americans Act.
"We will be reviewing all this as we move forward in our next budget year," she said.
The county will also receive funding from FEMA, and to date, they have received $15 million through the Great Plates Program, 1A and 1B, and the vaccination clinics.
"We still have $80 million of claims with FEMA that are in final review for testing, Project Roomkey, and Great Plates 1C and 1D," Mann said. "They were submitted back in October 2020, so we are anxiously awaiting those funds. We realize that FEMA is busy, as we aren't the only ones who have claims. We are trying to be patient."
The county also has another $50 million in claims they have not yet submitted for costs related to the Covid-19 pandemic.
"We anticipate that all of our CRF (Coronavirus Relief Funds) will be expended by the summer," she said.
Powers said every two years, there is an adjustment in actuarial assumptions and their investment return, and that will not be for this fiscal year but the following fiscal year.
"That will have additional cost impacts that will be evaluated," he said.
He said something else in the system eliminates criminal fines and fees for a very good purpose, which means an estimated revenue loss of $4-5 million.
"We want people who are in the system to overcome their challenges without being held back by significant fines," he said. "It's a laudable program, but the act of doing that does have an impact on our finances here. There is talk about state backfill, but if it's not adequate, we could have a loss of several million. We're continuing to advocate at the state level for that to make sure we get as much backfill as we possibly can."
The county set aside $2 million in reserves as a county match to develop permanent year-round homeless shelters.
"In the City of Ventura, we have The ARCH permanent year-round shelter," he said. "This budget includes splitting that cost with the city at $750,000. The board did recently approve a sharing agreement for a permanent year-round shelter in the City of Oxnard. You approved the conceptual cost-sharing agreement."
The current match estimate is a $2 million capital investment and $1.5 million in annual operating costs.
The county plans to have that money ready in future budgets as that shelter gets built.
"In terms of the MediCal waiver, it extended because of the pandemic," he said. "Every five years, that's where both of our MediCal programs come from; the state and local. That's been extended for one year, and that negotiation between the state and the federal government is happening right now."
This story will continue, June 25.