FY Funding Gap and Balancing Options

Transcription

1 FY Funding Gap and Balancing Options Presented to the Alameda County Budget Workgroup April 21, 2015 Susan S. Muranishi, County Administrator Kai Mander, Principal Analyst Alice Park-Renzi, Budget Coordinator

2 Federal & State Budgets Federal Budget President s Budget totals $4 trillion - $1.091 trillion or 25% for discretionary spending. Bipartisan budget agreement ends October 1, 2015 results in automatic $91B discretionary spending cut, $54B defense and $37B non-defense. Discretionary spending level would be $1.017 trillion. State Budget May Revision Increased revenue estimates expected Funding directed to education and debt reduction Democrats pushing for some restoration 2

3 State Legislative Efforts to Reduce Poverty SB 3: proposal by State Senator Mark Leno to raise statewide minimum wage from current $9/hour to $11/hour in 2016 and $13/hour by July 2017 Would supersede local ordinances that have wage rates lower than the proposed minimum Would allow cities to set higher minimum wages AB 43: proposal by State Assemblyman Mark Stone to create a state Earned Income Tax Credit (EITC) Would supplement the federal EITC 3

4 Credit Rating Agency Presentations Executive Summary The economic fundamentals of the County are strong. Growth in population, jobs and spending. Increasing concentration in high-income sectors, such as technology, research, and digital arts. Assessed valuation has reached new highs, with major real estate development underway drives major sources of discretionary revenues. The County continues to prudently manage its budgets without having to implement layoffs or furloughs or significantly reduce service levels. County voters support government services in renewing local sales tax to finance local safety net (Measure AA in June 2014) and transportation (Measure BB in November 2014, which extended and increased tax). The County is addressing the challenges of the Alameda Health System, and the Acute Care Tower project at Highland Hospital is on time and on budget. Alameda County Rating Agency Presentation page 4

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7 Relatively High Wealth Levels Median Family Assessed Value County Income Per Capita Santa Clara $90,747 $167,516 Contra Costa $78,187 $139,318 Orange $75,566 $142,483 Alameda $71,516 $129,583 San Diego $63,373 $124,742 Riverside $57,096 $93,166 Los Angeles $56,241 $109,784 Sacramento $55,846 $85,740 San Bernardino $54,750 $80,328 Fresno $45,741 $64,556 State of CA $61,400 Reflects 10 largest California Counties Source: United States Census Bureau, Various County Comprehensive Annual Financial Reports for FY , with exception of Sacramento County, which is FY

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16 FY MOE Budget General Fund ($ in millions) FY FY Inc/ % FINAL MOE (Dec) Change Appropriation $2,313.9 $2,388.8 $ % Revenue $2,313.9 $2,323.8 $ % Funding Gap $0 $65.0 $65.0 FTE Positions* 7,648 7, % *Full-time equivalent positions Note: Totals may vary slightly due to rounding 16

17 FY MOE Budget Net Cost Change by Program ($ in millions) Program FINAL Net Cost MOE Net Cost Change % Change General Government $84.5 $89.3 $ % Public Protection $263.6 $295.9 $ % Public Assistance $68.5 $86.2 $ % Health Care $118.4 $127.7 $ % Subtotal Programs $535.0 $599.1 $ % 17

18 FY MOE Budget Net Cost Change Non-Program ($ in millions) Program FINAL Net Cost MOE Net Cost Net Cost Change Net Cost % Change Capital $10.0 $10.9 $ % Contingency/Reserves/Debt Service, Designations $51.9 $57.9 $ % One-time use of FMR ($36.5) $0 $ % Non-Program Financing ($560.4) ($602.9) ($42.5) -7.6% Subtotal Other ($535.0) ($534.1) $ % TOTAL $0 $65.0 $

19 Net County Cost Increases by Program ($ in millions) Program Net County Cost (NCC) Increase Prior Year FMR Use Net County Cost Increase w/ FMR General Government $4.8 + $11.3 = $16.1 Public Protection $ $9.1 = $41.4 Public Assistance $ $2.1 = $19.8 Health Care $9.3 + $14.0 = $23.3 Program Total $ $36.5 = $100.6 FMR = Fiscal Management Reward 19

20 NCC Changes Outside of Program Areas ($ in millions) NCC Increase/ (Decrease) Contingency/reserves, debt service, designations $6.0 1% of discretionary revenue for Capital Projects $0.9 Non-program revenues ($42.5) Non-Program Total ($35.5) Total Gap: $65.1M 20

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22 Reduction Target Option A ($ in millions) Option A Equal Distribution Among Programs General Government $16.3 Public Protection $16.3 Public Assistance $16.3 Health Care $16.3 Total $65.1 Numbers and percentages are rounded for display purposes, but calculations are based on exact numbers. 22

23 Reduction Target Option B ($ in millions) MOE NCC w/o FMR Prior Year FMR Use NCC w/ FMR % Share of NCC w/ FMR Option B Based on % Share of NCC w/ FMR General Government $89.3 $11.3 $ % $10.3 Public Protection $295.9 $9.1 $ % $31.2 Public Assistance $86.2 $2.1 $ % $9.0 Health Care $127.8 $14.0 $ % $14.5 Total $599.1 $36.5 $ % $65.1 Numbers and percentages are rounded for display purposes, but calculations are based on exact numbers. 23

24 Reduction Target Option C ($ in millions) OPTION C Net County Cost (NCC) Increase Prior Year FMR Use NCC Increase w/ FMR % Share of NCC Increase w/o FMR Credit Share of $35.5M Based on % Share of NCC Increase Absorb NCC Increase w/ FMR and Credit Share of $35.5M Based on % Share of NCC Increase General Gov t $4.8 $11.3 $ % ($2.7) $13.5 Public Protection $32.3 $9.1 $ % ($17.9) $23.5 Public Assistance $17.6 $2.1 $ % ($9.8) $10.0 Health Care $9.3 $14.0 $ % ($5.2) $18.2 Program Total $64.1 $36.5 $ % ($35.5) $65.1 Non-Program ($35.5) Total Gap $65.1 $65.1 Numbers and percentages are rounded for display purposes, but calculations are based on exact numbers. 24

25 Reduction Target Option D ($ in millions) OPTION D Net County Cost (NCC) Increase Prior Year FMR Use NCC Increase w/ FMR FY MOE NCC % Share of NCC Credit Share of $35.5M Based on % Share of NCC Absorb NCC Increase w/ FMR and Credit Share of $35.5M Based on % Share of Net County Cost General Gov t $4.8 $11.3 $16.1 $ % ($5.3) $10.8 Public Protection $32.3 $9.1 $41.4 $ % ($17.5) $23.8 Public Assistance $17.6 $2.1 $19.8 $ % ($5.1) $14.6 Health Care $9.3 $14.0 $23.3 $ % ($7.6) $15.7 Prog Total $64.1 $36.5 $100.6 $ % $65.1 $65.1 Non-Program ($35.5) Total Gap $65.1 $65.1 $65.1 Numbers and percentages are rounded for display purposes, but calculations are based on exact numbers. 25

26 Reduction Target Options ($ in millions) Option A Option B Option C Option D Equal Distribution Among Programs Distribute Based on % Share of Net County Cost Absorb NCC Increase w/ FMR and Credit Share of $35.5M Based on % NCC Increase Absorb NCC Increase w/ FMR and Credit Share of $35.5M Based on % Share of NCC General Government $16.3 $10.3 $13.5 $10.8 Public Protection $16.3 $31.2 $23.5 $23.8 Public Assistance $16.3 $9.0 $10.0 $14.6 Health Care $16.3 $14.5 $18.2 $15.7 Total Gap $65.1 $65.1 $65.1 $65.1 Numbers and percentages are rounded for display purposes, but calculations are based on exact numbers. 4/22/15 Note: At the April 21 meeting, after discussion of the options the Budget Workgroup voted to adopt a different solution that resulted in the following reduction targets: $14.8M for General Government, $19.8M for Public Protection, $14.7M for Public Assistance, and $15.8M for Health Care. 26

27 Proposed Budget Calendar Budget Workgroup Meeting - Balancing Options & Reduction Targets April 21, 2015 Reduction Plans submitted to CAO May 6, 2015 Budget Workgroup Meeting May 18, 2015 Proposed Budget to Board Early June 2015 Budget Hearings June 2015 Final Budget Adoption Late June

28 Alameda County Budget Information on the Web 28

29 FY Funding Gap and Balancing Options Presented to the Alameda County Budget Workgroup April 21, 2015 Susan S. Muranishi, County Administrator Kai Mander, Principal Analyst Alice Park-Renzi, Budget Coordinator