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Politics & Government

County Finances Under Review

"Looking out to fiscal year 2012-13 and beyond, the county still faces significant challenges."

Most Riverside County agencies are expected to meet their budget goals in the current fiscal year, but a few are teetering, and the county's chief executive officer says department heads should be prepared to do "more with less," according to a report the Board of Supervisors will review today.

The Executive Office's third-quarter budget report sheds light on the county's present financial condition and underscores what will likely increase pressure on the treasury over the next couple of years.

"Looking out to fiscal year 2012-13 and beyond, the county still faces significant challenges," Executive Officer Jay Orr wrote in a preface to the report. "I will press for greater operating efficiency across departments and put all options on the table to achieve more with less. I have advised departments ... to downsize staffing further (and) to begin that process now."

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Earlier this year, the Executive Office predicted up to 200 layoffs may be necessary to cut costs and close the county's structural budget gap by next year. Supervisor Jeff Stone believes 500 to 1,000 positions should be chopped to make the government more proportional to the population it serves.

According to the budget report, the county will end 2011-12 with $4 million in unanticipated revenue, thanks to a larger allocation of property taxes received from the state in lieu of vehicle license fee revenue.

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But despite the additional discretionary funds, the county will go into 2012-13 with a growing list of greater financial obligations, stemming from higher labor and pension costs, as well as expensive capital projects, the report says.

Recently negotiated collective bargaining agreements with several public sector unions -- including the Service Employees International Union, the Laborers' International Union of North America and the Riverside County Deputy District Attorneys' Association -- will saddle the county with increased salary and benefits costs totaling $380 million over the next four years, according to county officials.

The budget report stated that a lower rate of return on investments managed by the California Public Employee Retirement System will require the county to shift more general fund dollars to make up the shortfall, all while assessed valuations on properties countywide slip another 2.2 percent, further lowering the county's chief revenue source -- property taxes.

County officials also noted the board's plan to expand local correctional facilities will draw down revenue.

According to the Executive Office, three agencies are likely to report red ink on their budgets come June 30, the end of the current fiscal year: The Department of Animal Services, the Fire Department and the Office of the Registrar of Voters. The latter's $1.8 million overage is roughly half of its budget and the result of state withholding, according to county documents.

The report indicated the board may have to address the funding gap to prevent operational deficiencies going into the Nov. 6 general election.

Animal services' $325,000 shortfall was tentative and stemmed from a personnel lawsuit, according to the report. County fire's $2.7 in red ink is a carryover from the 2010-11 fiscal year.

Fire Chief John Hawkins told the board in March that he expects the department will head into 2012-13 with a $6.5 million deficit because of spending cuts planned as part of the county's deficit reduction strategy. He said a desert station will have to be shuttered, a Jurupa Valley station will be partially deactivated and about 24 jobs may have to be slashed to reduce costs.

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