Coronavirus issues including revenue and expenditure uncertainties and limits on public participation at gatherings have caused the County of San Diego to postpone its budget process.
A 5-0 San Diego County Board of Supervisors vote April 21 changed the public hearings on the county’s 2020-21 budget from June 8-17 to Aug. 10-19 and changed the date budget deliberations begin (and end if they are completed that day) from June 23 to Aug. 25. The action also authorized the expenditure of funds until the 2020-21 budget is adopted.
Both a Declaration of Local Health Emergency and a Proclamation of Local Emergency were declared by the county Feb. 14 due to the coronavirus epidemic. The county has incurred expenditures for coronavirus control measures, the Board of Supervisors approved the waiver or deferment of certain fees during the economic crisis resulting from the shutdown, some federal or state funding may be diverted and the county cannot be assured of those normal sources of revenue, reduced income tax revenue could also lead to reduced Federal or state funding to local governments, and the adverse effect on publicly-traded stocks which are part of the county’s pension fund investment portfolio will require the county to make additional contributions to meet pension obligations.
The budget process includes the allocation of Community Enhancement funding derived from the county’s Transient Occupancy Tax. The TOT is collected on a quarterly basis and lodging facilities have a month following the end of the quarter to submit payment, so as of April 21 only the first two quarters of the 2020-21 fiscal year were finalized. The third quarter will include less than a month of the period in which activity was halted while the fourth quarter will reflect additional lodging losses.
The county’s 2019-20 budget was approximately $6.25 billion. The supervisors’ April 21 action authorized the carryover of 2019-20 appropriations into the 2020-21 fiscal year, so until the 2020-21 budget is adopted the authorized expenditures for 2019-20 will be allowed.
The deliberations which had been scheduled to begin at 2 p.m. June 23 will begin at that time Aug. 25. The postponement of the budget process also applies to the separate legal districts administered by the county.