FY 2019-20 Financial Forecast

The County’s FY 2019-20 Financial Forecast was presented to the Board of Supervisors on October 9, 2018. It's important to note that the forecast is a pre-cursor to the budget, based on a variety of assumptions. See the list of assumptions below. 

Financial Forecast FY 2019-20

Estimated Revenues:             $542.8 million

Estimated Expenditures:        $550.3 million

Estimated Gap                         $   -7.5 million

Estimated Gap Range             $5 – 10 million**

Watch the Financial Forecast Presentation (October 9, 2018)

 

Forecasted Revenue Assumptions

Overall, County staff projects next year’s revenue to come in at $542.8 million. The forecast also assumes that the State will provide revenue for various mandated programs and services we provide to help us cover those expenses. The forecasted revenue was comprised of:

  • Non-departmental revenue - $213.1 million (up 4%), which assumes:
    • Next year’s property taxes will increase by 5%, based on increased property values, less funding from Proposition 8, and restoration of values for those properties that saw a decline during the downturn
  • Departmental - $298.5 million (up 2.6%), which assumes:
    • Next year’s realignment revenue will continue flatten out
    • Anticipated increases in Health Agency and Department of Social Services program costs due to programmatic changes (much of which is General Fund neutral), which will be funded by one-time grants
    • Slower departmental revenue growth next year compared to prior years, which is when we saw growth tied to the Affordable Care Act
  • Fund Balance Available (FBA), which is unspent funds from FY 2018-19) – $30 million - $33 million range. FBA varies significantly from year to year and the County uses these unspent funds from the current fiscal year as revenue for the next year. FBA is comprised of:
    • Higher than expected revenue at the end of the fiscal year.
    • Unspent contingency funds at year-end. Contingency funds are built into the budget to help the County pay for any unanticipated or unbudgeted expenses and emergencies throughout the year.
    • Unspent expenses that were budgeted.

Forecasted Expenditure Assumptions

County staff anticipates a total expense at $550.3 million. The FY 2019-20 Financial Forecast assumes that the County will continue current programs and services, with no increases in the current year, or in FY 2019-20. The key components of anticipated expenses are:

  • Salaries and Benefits at $304.4M; this is assuming that there will be:
    • Anticipated expected salary and benefit, based on approved MOUs and terms
    • No anticipated increases to Other Post Employment Benefit (OPEB), Pension Obligation Bond (POB), or Workers Compensation or Liability charges
  • Services and supplies at $245.9M, this is assumed that:
    • Services and supplies will increase by 2% increase, based on the Consumer Price Index
    • Some Health and Human Services programmatic expenses will increase. Notably: an additional $2.2 million of General Fund expense for IHSS, based on State’s restructuring of that program
    • There will be an additional General Fund cost of about $2.3 million for capital and maintenance projects (this amount was paid with reserves in the current year- could be again)
    • There will be an additional cost of about $2.6 million to fully fund depreciation amounts to general government building replacement and countywide automation replacement funds
    • There will be an additional expense of $560,000 for Parks, given policy decision on July 17, 2018 about parks funding
    • The County will continue to budget its target of a 5% contingency to cover unanticipated or unbudgeted costs, mostly in the event of an unpredictable emergency or disaster.  

**The estimate is presented in a range because if any of the above assumptions are off by just 1%, the actual budget could be different than what is projected in this forecast. 

Watch the October 9, 2018 presentation.

Download the staff report.

Learn more about how the County develops and manages its budget.