No Serious Revenue Shortfalls On The Horizon: County Of Riverside

RIVERSIDE COUNTY, CA — Riverside County government coffers are holding steady and are even a little flusher than the start of the current fiscal year, instilling confidence among officials that budgeting for the 2022-23 fiscal year will not pose significant challenges, according to a report that the Board of Supervisors will review Tuesday.

"We continue to prioritize increasing our general fund reserves to better prepare for whatever comes next," county CEO Jeff Van Wagenen said in an introduction to the 22-page midyear budget report. "As we develop the 2022- 23 budget, we will continue to focus on prudent spending, fiscal stability and transforming how we deliver services."

The midyear report — one of the shortest in the last decade — said that discretionary revenue is now projected to be almost $33 million more than anticipated when the 2021-22 blueprint was approved last June. The cumulative total will likely be $953.6 million, rather than the original estimate of $921 million.

Executive office staff attributed the rise to higher motor vehicle in lieu of property tax revenue, as well as much higher sales and use tax receipts -- $9 million over the original estimate -- increased documentary transfer tax streams and better-than-expected spillover savings from the previous fiscal year.

One of the brightest spots in the budget report was in Proposition 172 public safety sales tax income, which is predicted to top out at $257 million, or $24 million more than initial budget projections, according to the executive office.

The county reserve pool is also swelling, and officials believe it will contain $351 million by the end of the current fiscal year. The pool held about $231 million at the beginning of 2021-22.

There was no clear reference in the midyear report to the enormous revenue boosts that the county has enjoyed in the form of federal outlays under the Coronavirus Aid, Relief & Economic Security Act of 2020, and the American Rescue Plan Act of 2021, which altogether have, to date, resulted in almost $800 million in additional funds for a variety of appropriations.

The Board of Supervisors was able to avoid budget cuts and payroll reductions in part because of the taxpayer-backed infusions in the prior and current fiscal years.

The report pointed out that a number of agencies will need to make financial adjustments before the end of 2021-22, totaling about $58.3 million. However, only 2% of those costs will be borne by the general fund, with the balance absorbed by the agencies via their internal budgets.

No serious revenue shortfalls are on the horizon.

About $300,300 will be needed from the contingency account to pay for expenses tied to the redistricting of supervisorial districts approved by the board in December, as well as paying for a new policy analyst in the executive office, according to the report.

Hearings on the 2022-23 budget are scheduled for June 13 and 14, though the board may expand the days if necessary.

The fiscal year ends on June 30, and a tentative spending plan must be in place under state law.