Jurisdictions prepare for budget season

As spring approaches so does the time local municipalities begin the process of drafting budgets for the coming fiscal year. For some, the process has already begun.

Yuba County began its process on Feb. 24, according to deputy county administrator

Grace Mull. She said the process begins with budget packets being sent to all county departments. The packets include fiscal year 2021/2022 estimated salary and benefits plus other estimated operating cost rates for the new fiscal year. Each department has one month to create its own requested budget, which includes

estimated expenditures and revenues.

Each budget is reviewed by the county administrator’s office to determine the general fund needs of the county and then compare that to the estimated general fund revenue available to see if any adjustments have to be made to expenditures.

“The goal is to ensure that estimated expenditures are covered by all estimated revenue sources including the general fund,” Mull said in an email. “The biggest ongoing challenge from year to year is that we have enough revenue to cover uncontrolled costs related to pensions and health insurance.”

Mull said the pandemic is not expected to adversely affect the 2021/2022 fiscal year budget. Last year, a proposed budget was not produced because of staff availability during the pandemic. Supervisors approved the rollover of the 2019/2020 budget to allow time for staff to produce the final 2020/2021 budget in September 2020.

“The budget process is very challenging and a balancing act each year,” Mull said.

“The county’s main goal in producing the new year’s county budget is to ensure that county services are not interrupted.”

County spokesperson Russ Brown said significant projects dealt with obstacles created by the pandemic. The Tri-county Juvenile Hall project started last month and required a more unique county budget because of the scope of the project that required state and federal funding.

“The county bolstered existing online services over the past year, while additional e-services were established,” Brown said in an email. “In the coming fiscal year, we anticipate dedicating resources to support further expansion of those capabilities.”

Marysville

New City Manager Jim

Schaad said the city’s budgeting process is arguably a yearround activity.

“Though the budget is approved by the council in the May-june time frame, financial staff review status during the fiscal year and minor adjustments occur,” Schaad said in an email.

He said staff begins developing the budget in

March in order to present the proposed budget to the council in late May. Marysville’s process is similar to other municipalities. Staff estimates anticipated revenues based on historical information and forecasting methods. Estimated expenses are developed and vetted by the finance department.

That information is used by Schaad in collaboration with staff directors to develop a balanced budget. The council will discuss, deliberate, take public comment and direct staff to revise the proposed budget before a final budget is voted on by the council.

“Similar to last year’s budget process, forecasting revenues in the wake of the COVID pandemic will continue to be our biggest challenge,” Schaad said.

COVID-19 impacted last fiscal year’s budget by partially shutting down the economy and creating uncertainty in tax revenue generation, particularly in sales tax.

Schaad said the city took a conservative approach to revenue projections and budgeted expenses accordingly.

“Fortunately, actual tax revenues have been better than initial projections,” Schaad said. “With the promising outlook of reopening businesses we are cautiously optimistic regarding revenues.”

Wheatland

The city will begin its budget process later this spring, according to City Manager Jim Goodwin.

“Changing state orders to open/close businesses due to the pandemic make it difficult to accurately project revenue,” Goodwin said in an email. “Sales tax represents about 45 percent of the city’s general fund revenues used to pay for public safety, administration, street maintenance and park maintenance.”

Goodwin said Wheatland publishes a monthly update on city services. Staff will consider current actuals, historical revenue and expense trends, revenue estimates and current events that may impact revenue and expenses.

Sutter County

The official start of the 2021/2022 fiscal year budget process was in December 2020 when supervisors adopted the budget calendar, assistant county administrator Leanne Link said.

In January, a roll out meeting is held with departments after the CAO’S office develops budget instructions. Staff prepares projections and internal charges for information technology, maintenance of county vehicles and building maintenance are calculated. Department staff calculate department specific revenues, which primarily come from state and federal programs along with user fees. The CAO and AuditorController’s offices calculate major revenues such as property tax and sales tax.

Friday was the deadline for departments to submit their budgets to the CAO’S office, according to Link. This year, there will be a budget study session with the board to review requests and inform the final recommended budget. The CAO’S office publishes a recommended budget book on June 3. Budget hearings with supervisors begin on June 15 and the budget will be adopted on June 22.

“Our costs are increasing but our revenues are either stagnant or declining,” Link said in an email. “At the same time, the public expects high levels of service.”

She said departments are always looking to make the delivery of services more efficient and reduce costs. Sutter County has one of the lowest ratios of county employees per capita in the state.

“It’s a continual challenge to meet the public’s demands when our revenues aren’t growing proportionately,” Link said.

The pandemic delayed the adoption of the 2020/2021 budget because of the unknown about the effect on revenues. It hasn’t impacted the 2021/2022 fiscal year budget, according to Link.

Yuba City

The budget process has already begun and departments are preparing their individual budgets to send to the finance department later this month, according to City Manager Dave Vaughn. After the finance department puts together the budget, there are study sessions in May. Once adjustments are made the final review and adoption takes place around June.

“The biggest challenge remains the unknowns of the ongoing pandemic,” Vaughn said in an email. “Yuba City’s revenues have been boosted by local citizens conducting business close to home versus heading to Roseville and Sacramento pre-pandemic; this could be inflating revenues.”

For the 2020/2021 year, the city made 2.5 percent expenditure cuts and passed a deficit budget until it was more certain about revenues.

“Sales tax revenues continue to be strong in this area and may prove us wrong, again, as they did at the end of the FY 2019/2020,” Vaughn said.