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The Placer County Board of Supervisors received a gloomy briefing Tuesday on the potential budget implications of state-funding reductions and new county responsibilities proposed by California Gov. Jerry Brown.

‘Clearly, there are huge risks to the county,’ county Finance and Budget Operations Manager Graham Knaus told the board, saying staff’s initial estimate is that Placer County has about $30 million directly at risk from proposed state-funding reductions and potential shortfalls in funding for new county responsibilities.

He emphasized that estimates of potential impacts to Placer County are preliminary, and will change as more details of the governor’s plan are announced and the proposed budget is reviewed by the State Legislature.

On Jan. 10, the governor proposed a $127.4 billion state budget for the 2011-12 fiscal year that has major ramifications for the state’s 58 counties. 

To help close a state budget deficit projected at $25.4 billion for the next 18 months, Brown is proposing reductions in state funding for many county programs and a realignment that would shift many state responsibilities to counties. 

To help fund the new county responsibilities, Gov. Brown is seeking to hold a statewide special election in June where voters would be asked to extend for five years several tax increases enacted in 2009 that are set to expire June 30. 

Knaus told board members the governor’s plan raises several concerns for counties, including uncertainty over whether the tax-hike revenue would fully cover new costs, what would happen if the voters opted not to extend the tax hikes and what additional funding would be available to counties after any voter-approved extensions of the tax hikes expired. 

In his proposed budget, Gov. Brown also proposed dissolving county and city redevelopment agencies throughout California by July 1. His plan would allow local officials to continue making payments on existing redevelopment debts and other obligations. 

At Tuesday”s meeting, the board voted unanimously to approve a resolution aimed at ensuring Placer County will be able to spend $18.4 million in already-budgeted redevelopment projects if the state moves to eliminate redevelopment agencies.

The resolution would not fast track any of the Placer County Redevelopment Agency’s projects and programs, and is consistent with the governor’s proposal. 

County Executive Officer Thomas M. Miller and county Deputy Redevelopment Director James LoBue told the board the county is simply seeking to ensure it can complete near-term projects. 

‘None of these are new projects or programs,’ LoBue said. ‘We”ve been working on them for years.’

The purpose of the resolution is to formally document the agency’s existing commitments and to establish a cooperative agreement that would put Placer County in a better position to spend the $18.4 million on already-approved projects and programs even if the state dissolves the Redevelopment Agency. 

Placer County has redevelopment areas in North Auburn, North Lake Tahoe and the Sunset Industrial Area in South Placer. 

The $18.4 million is set aside to help fund a variety of projects, including Highway 49 streetscape improvements and the Quartz Ridge Family Housing Project in North Auburn, transportation improvements in the vicinity of the Sunset Industrial Area, and the Kings Beach Commercial Core Improvement Project at North Lake Tahoe. 

In his report to the board, Knaus says the governor’s proposed budget could have major impacts on several county departments, including the Sheriff’s Office, Probation Department and District Attorney’s Office.

Proposed budget includes major policy, responsibility and funding shifts that would:

  • Require Placer County to manage an estimated 347 additional offenders per year in jail or on probation if counties must assume responsibility for low-level, nonviolent adult offenders not convicted of sex crimes.
  • Have the county manage an estimated 620 more adult parolees each year if responsibility for adult parolees is shifted to county probation departments.
  • Make the county responsible for housing, treating and supervising about 10 more juvenile offenders annually if the state eliminates its Division of Juvenile Justice.

‘Although these policy shifts are proposed to come with funding, preliminary analysis suggests that new costs borne at the local level may not be fully covered,’ Knaus explained in a written report to the board.

In addition, the three departments stand to lose about $1.9 million per year if the state’s voters opt not to extend a vehicle license fee increase that is part of the package of tax hikes that would face the electorate at the June Special Election.

Gov. Brown’s proposed budget also would have a major impact on the Placer County Health and Human Services Department. The governor is seeking to make counties permanently responsible for several programs: mental health; child welfare, foster care and adoption programs; Adult Protective Services; and substance abuse treatment. 

The proposed budget also calls for changes that would leave fewer residents eligible for such programs as CalWORKs, In-Home Support Services and Medi-Cal. 

Placer County and local independent fire districts could face higher costs as a result of a proposal by the governor to shift responsibility for fighting fires in many areas from CAL FIRE to local agencies. 

Knaus also noted the Placer County Library would lose about $84,000 per year under a proposal by Gov. Brown to eliminate all state support for county libraries. 

Placer County also would continue to experience cash-flow challenges because of the governor’s intention to defer some payments to counties, including 2011-12 payments for pre-2004 mandate reimbursements.

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