Layoffs, early retirements and attrition will reduce the Riverside County government payroll by roughly 1,000 employees this year, county officials told the Board of Supervisors today.
During the final hearing on the 2010-11 budget plan, county Executive Officer Bill Luna said spending controls would result in “more layoffs than early retirements” and if further belt-tightening becomes necessary, the county could reintroduce a hiring freeze.
The first freeze went into effect early last fall and ended in February.
County Chief Financial Officer Ed Corser told the board a number of variables remain in play that could change the county’s spending plans, including the outcome of the Legislature’s decisions on the state budget.
“If the state starts to defer money to us, we’re going to need to take some action,” Corser said.
Corser said the county is trying to reassign downsized employees to vacant positions in other departments wherever possible.
Supervisor Jeff Stone emphasized the need to provide job-hunting and retraining assistance to laid-off workers through the county’s Workforce Development Centers, which Corser agreed would be done.
The sole agency head testifying during the budget hearing was Susan Loew, director of the Department of Public Social Services.
Loew said the planned 18 percent cut in general fund support for the DPSS budget would delete about $800,000 for homeless programs. The reduction would mean homeless shelters scaling back their operations, according to Loew.
“This is a relatively small piece of the county budget,” responded Supervisor John Benoit. “But it would mean dramatic and painful changes at shelters serving useful purposes.”
The board tentatively agreed to apply funds from individual supervisors’ community improvement budgets to make up the shortfall for homeless assistance.
DPSS is slated to lose a total $9.7 million in appropriations. The department has the largest budget of any county agency, but 90 percent of its funding originates from state and federal sources.
The Executive Office has characterized the 2010-11 budget, which is expected to be finalized on Aug. 10, as a “conservative” appropriations plan that adjusts for ongoing economic challenges.
In May, economic consultants from Cal State Fullerton and Los Angeles- based Beacon Economics cautioned that anemic growth was ahead, with the possibility of the national economy contracting again, in a “double-dip recession.”
To prepare for that contingency and maintain the county’s investment- grade credit rating, the Executive Office emphasized the need for robust reserves and limited red ink.
The county’s reserve pool is roughly $303.5 million, of which $205 million is set aside for “economic uncertainty” — down 50 percent from three years ago.
According to county officials, about $70 million in reserves will be needed to offset revenue losses, combined with $63 million in spending cuts.
Minus the planned spending cuts and reserve allocations, the county would end the next fiscal year $133 million in the hole, according to the Executive Office.
Discretionary revenue is expected to drop 3 percent, or $27 million, to $592 million, mostly because of falling property tax revenue, which comprises more than 80 percent of the county’s discretionary income.
Riverside County’s property tax assessment roll lost 4.5 percent of its value in the last year under the weight of a depressed real estate market, according to the Assessor-Clerk-Recorder’s Office. The drop follows a 10.5 percent decline — the largest on record — in 2008.