The Tuolumne County Board of Supervisors passed a $232 million recommended spending plan for the 2018-19 fiscal year on Tuesday that includes $20 million for construction of a new county jail, but there’s a looming debate over pending requests from a local arts organization and food bank when the final budget is presented in September.
District 5 Supervisor Karl Rodefer was highly skeptical of his willingness to approve a request by Amador-Tuolumne Community Action Agency for up to $250,000 and another by the Tuolumne County Arts for $35,000.
“I’m going to find it impossible to write bigger checks or checks to outside organizations if we can’t staff this county and do our job the way I think we need to,” Rodefer said.
Rodefer said he wanted County Administrator Craig Pedro to work with Amador County, the other half of the joint-powers agreement that established ATCAA, regarding the agency’s request for the board to increase the annual funding it provides from $24,000 to $50,000.
The agency also is asking for up to $200,000 to support its Food Bank in Jamestown that recently lost more than $150,000 a year in federal funding due to changes in the U.S. Department of Urban and Housing Development’s Community Development Block Grant program.
“I’m on ATCAA’s board and I’ll be very glad to look at my fellow board members and tell them we’re not going to give them $26,000 extra dollars,” he said. “As far as the food bank goes … that’s off the charts. I mean, I wouldn’t give them $20,000, let alone $200,000.”
Rodefer said people who enjoy the arts should support the Tuolumne County Arts program through fundraisers as opposed to taxpayer money helping to support its operations.
Much of the board’s discretion over spending is money in the county’s General Fund that pays for most core services and employee salaries. The amount in the fund this year is expected to be nearly $75 million.
County officials spent months chipping away at a nearly $5 million projected deficit in the General Fund to balance the recommended budget, which doesn’t account for things like state and federal spending that won’t be known until later in the summer.
Auditor-Controller and County Clerk Debi Bautista warned of the need to start paying down the county’s unfunded liabilities in the California Public Employees Retirement System.
Bautista said the county’s unfunded liability for miscellaneous employees alone is $86 million.
“This is only for the miscellaneous group,” she said. “We haven’t even started to start delving into the safety group.”
District 5 Supervisor Karl Rodefer said he didn’t want the public to believe that the county was in a unique situation, as all public agencies that pay into the CalPERS system are looking at rising costs to fund liabilities because of changes to the state pension fund.
Rodefer asserted that the county was in better shape than most jurisdictions, but Bautista said that’s not true when it comes to CalPERS.
“Again, we’re being blown away by these numbers,” Bautista said.
Prior to the final budget hearings in August and September, Bautista said she and her team are putting together a presentation for the board to show exactly where the county stands compared to other counties in the state.
Bautista urged the board to reconsider putting $250,000 in the county’s General Reserves in an effort to bring the funds up to 5 percent of the total operating budget for government funds, which doesn’t include money set aside for capital projects.
After reviewing the government code, Bautista determined that the board could opt to move the $250,000 from the reserves to paying down some of the unfunded liabilities through approval from at least four out of the five supervisors.
“We need to get in the driver’s seat of this PERS issue and not be sitting at the back of the bus,” she said. “We’re going to need all the funds we can to start paying down.”
The county’s financial woes have been blamed primarily on costs that board has little control over, such as CalPERS, that are outpacing growth in revenues.
To address the disparity, the county has started to look at additional ways of raising revenue like a potential ballot measure to increase or expand the existing Transient Occupancy Tax that’s currently 10 percent of the price charged to stay at area hotels and other short-term rentals.
The board reviewed its options for potentially placing a tax measure on the ballot that would either increase the TOT rate to 12 percent, expand the tax to include private campgrounds and RV parks, or both.
Voters rejected a measure in the June 2012 primary election to expand the tax to private campgrounds, RV parks and houseboats by a margin of about 56 percent to 44 percent.
Rodefer, who campaigned that year for his first election, said he voiced opposition to the previous measure because he believed it was poorly written. For example, it was later determined that levying the tax on houseboats would be illegal.
The way the tax works is that 25 percent of revenues goes to the Tuolumne County Visitors Bureau’s in hopes of increasing tourism that will in turn help the businesses being taxed, while the remaining amount goes to the county’s General Fund to be used how the board sees fit.
Lisa Mayo, executive director of the visitor’s bureau, said she polled some of the local hospitality businesses she works with and many are not supportive of increasing or expanding the tax out of concern it will make the county less competitive than others where the tax is lower.
Raising the tax to 12 percent put it among the highest in the state behind only Orange, Los Angeles and San Francisco counties that have higher rates. However, it would be equal to the rate of both Mono and Inyo counties that have less than half the population.
The county estimates that the increase would provide an additional $740,000 a year in revenue, while expanding the tax to campgrounds and RV parks would provide an additional $250,000.
District 2 Supervisor Randy Hanvelt said the tax helps the county fund emergency services that visitors require in a disproportionate amount than local residents.
District 1 Supervisor Sherri Brennan said she believed that proposed expansion of the tax in 2012 contained too many exemptions that need to be looked at in any future measure that would be placed on the ballot.
Ultimately, the board directed staff to develop three separate options for a proposed ballot measure to only increase the TOT tax, only expand the tax to campgrounds and RV park, and another to do both.
The board will have to decide whether to approve the measure for the Nov. 6 general election ballot at a later date.
Later in the meeting, the board also approved introducing an ordinance that would put a measure on the Nov. 6 ballot to establish a business-license tax on cannabis businesses that would be up to 15 percent of gross receipts. The board would have the authority to determine the rate if approved by voters.
Commercial cannabis activity is currently banned by county ordinance, though the measure is intended to put a tax structure in place if any future boards decide to reverse the ban or other changes to state law.
The measure is likely to face opposition from people who are against allowing commercial cannabis, as some have already said that voting yes on the measure could be construed as tacit approval of such activity.
Also on Tuesday, the board approved refinancing a $6 million bond the county sold in 2006 as part of settlement with the state to cleanup a former gold mine property west of Jamestown that’s partially owned by the county.
Refinancing the bond is expected to save the county up to about $500,000 when the bond matures in 19 years.
Contact Alex MacLean at firstname.lastname@example.org or (209) 588-4530.