To: Board of Supervisors
From: Monica Nino, County Administrator
Report Title: Fiscal Year 2023-2024 Adopted Budget as finally determined
RECOMMENDATIONS:
ADOPT Resolution No. 2023/556 adopting the Fiscal Year 2023-2024 Adopted Budget as finally determined, including:
a. Final changes to close out the 2022-2023 County Budget, including changes to revenues, appropriations, and obligated fund balances; and AUTHORIZE the Auditor-Controller to make the necessary changes in the financial accounting system, as reflected in Attachment A;
b. Final changes to the 2023-2024 County Budget, including changes to appropriations, revenues, and obligated fund balances; and AUTHORIZE the County Administrator and Auditor-Controller to make technical adjustments to the budgets pursuant to Attachment B (County - Schedule A, B, and C);
c. Final changes to close out the 2022-2023 Special Districts Budget, including changes to revenues, appropriations, and obligated fund balances; and AUTHORIZE the Auditor-Controller to make the necessary changes in the financial accounting system, as reflected in Attachment C; and
d. Final changes to the 2023-2024 Special Districts Budget, including changes to appropriations, revenues, and obligated fund balances; and AUTHORIZE the County Administrator and Auditor-Controller to make technical adjustments to the budgets pursuant to Attachment D (Special Districts - Schedule A, B, and C).
FISCAL IMPACT:
As described in the background information below, this action adjusts FY22-23 appropriations and revenues to balance budgeted figures to actual experience; and for FY23-24, includes fund balances, reserves, designations and all estimated revenue and appropriation line-item changes to correspond to the latest information.
BACKGROUND:
On April 24, 2023, the Board of Supervisors adopted the State Controller's Office Fiscal Year 2023-2024 Recommended Budget Schedules for Countywide Funds and Special Districts, conducted public hearings on County and Special District budgets, and directed the County Administrator to prepare for Board adoption the FY23-24 County and Special District Budgets, as modified, to incorporate any changes directed by the Board during the public hearings.
On May 23, 2023, the Board of Supervisors requested that the Auditor-Controller make adjustments to the FY22-23 appropriations and revenues by reallocating and balancing budgeted and actual expenditures and revenues as needed for various budget units and special districts, subject to Board approval in September. This request is pursuant to state law that requires each budget unit and expenditure object level within those units not exceed appropriations. Each year, this requirement generates a substantial number of adjustments to balance each budget unit and object. Attachments A and C (County and Special Districts respectively) contain the necessary appropriation adjustments to close out the FY22-23 Budget. Due to the volume of adjustments required and as allowable by the Budget Act (with the exception of fixed asset accounts ) adjustments are made to balance by major object (i.e. 1000, 2000, etc.); therefore, the over/under amounts do not always tie to the specific appropriation account.
Also on May 23, 2023, the Board of Supervisors authorized the Auditor-Controller to make technical adjustments to the FY23-24 County and Special District Budgets when actual amounts were known. This action is pursuant to state law that requires the Board of Supervisors adopt a budget which includes obligated fund balances and all estimated revenue and appropriation line-item changes to the proposed Budget no later than October 2 of each year. Attachments B and D (County and Special Districts respectively) include changes to revenues, appropriations, and obligated fund balances in the FY23-24 Budget to correspond with the latest fiscal and legal information.
Schedule C begins with the final year carryforwards and appropriations adjustments as described above. Note that the General Fund budget is required to be balanced, therefore there is not a recommended budget fund balance nor a final budget fund balance. Non-general funds can carry appropriated fund balance and therefore those funds may include recommended budget fund balance and final budget fund balance.
Schedule B begins with the total fund balance calculated by the Auditor for each fund. From that total, encumbrances, the total from Schedule C, and all the fund balance totals from Schedule A are subtracted. Encumbrances are used to control expenditure commitments and enhance cash management. The assignment to general fund reserve is the residual net resources excess of non-spendable, restricted, and committed fund balance over total fund balance. Note that the term fund balance available is misleading as the majority of these funds are restricted.
Schedule A details the obligated fund balances. The obligated amounts increase or decrease only by Board adoption or adopted Board policy. The Schedule begins with the end of year totals in each fund balance category:
• Non-spendable: inherently non-spendable due to their form;
• Restricted: externally enforceable limitations of use imposed by creditors, laws or enabling legislation;
• Committed: self-imposed limitations set in place prior to the end of the year by the Board of Supervisors;
• Assigned: limitation resulting from intended use by the Board of Supervisors; and
• Unassigned: which is the residual net resources excess of non-spendable, restricted, and committed fund balance over total fund balance.
The final figures in Schedule A are updated per previous actions of the Board. For the General Fund:
• $864k is restricted for the East Bay Regional Communication System (EBRCS);
• $3.19M is restricted for the CCTV’s Public, Educational, and Governmental Fund;
• $24.47M is restricted for Medicare Part D;
• $20.0M is assigned for litigation and audit exceptions
• $585k is assigned for Law and Justice Information Systems
• $508k is assigned for Dependent Care Assistance Plan (DCAP)
• $965k is assigned for Health Care Spending Account (HCSA)
• $2.94M is assigned for Facility Improvements For Juvenile Hall
• $2.42M is assigned for Vehicle Theft
• $2.05M is assigned for Elections Capital Replacement Surcharge
• $1.11M is assigned for Office of Restorative Justice Planning & Implementation
• The $21.06M increase to the assignment for capital reserve is directed by the General Fund Reserve Policy (as described on page 23 of the FY23-24 Recommended Budget);
• $20.0M is assigned for the Measure X reserve; and
• $164.38M increase was assigned to the general fund designated reserve.
Included in these annual materials are several items of note, specifically Schedule C in Attachment B totals $148.05M. Of this amount, $72,291,114 are non-General funds and restricted. The balance of $75,758,399 are for General Fund appropriation carryforwards and adjustments that fall into five general categories as detailed below:
• Measure X committed funds total $52.95M or 69.9% of the total carryforwards;
• Restricted funds total $10.0M or 13.2%;
• Information technology costs total $3.47M or 4.6%;
• Capital project costs total $5.37M or 7.1%;
• And $3.98M are for program related costs, such as $1.41M for the final payment of the Paulson Settlement, $825k for Law and Justice Information Systems projects, $600k related to Rodeo Unocal Return to Source, and other miscellaneous appropriations.
Attachment B (Schedule B) includes encumbrances of $84.7M, of which $83.9M is in the General Fund. Encumbrances reflect the outstanding contractual obligations for which goods and services have not been received and are set up to reserve portions of applicable appropriations. Encumbrances still open at year end are not accounted for as expenditures or liabilities, but as a constraint imposed on fund balance.
Timing of the phases of the compilation, publication, presentation, and adoption of the County budgets is an important topic of discussion. All of the individual phases of the County budget process have significant timing restrictions and adhere to the County Budget Act, as prescribed in Government Code 29000-29144. The County of Contra Costa operates on a modified accrual basis. Modified accrual accounting combines accrual basis accounting with cash basis accounting. Revenues are recognized when they become available and measurable and, with few exceptions, records expenditures when liabilities are incurred. For practical purposes this means that the final budget for June 30 includes a sixty-day adjustment period, leaving very little time to prepare the State Schedules for review and adoption. Government Code section 29088 states that the budget shall be adopted by Resolution no later than October 2.
CONSEQUENCE OF NEGATIVE ACTION:
Delay in Final Budget Adoption and failure to meet state requirements in Government Code section 29088.
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I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on the date shown. |
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ATTESTED: |
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Monica Nino, County Administrator and Clerk of the Board of Supervisors |
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By: |
THE BOARD OF SUPERVISORS OF CONTRA COSTA COUNTY, CALIFORNIA
and for Special Districts, Agencies and Authorities Governed by the Board
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IN THE MATTER OF
Adopting the Fiscal Year 2023-2024 Adopted Budget as finally determined and Closing-out the FY22-23 Budget.
WHEREAS,
The Contra Costa County Board of Supervisors acting in its capacity as the Governing Board of the County of Contra Costa and all districts of which it is the ex-officio governing Board.
NOW, THEREFORE, BE IT RESOLVED
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The Board ADOPT final materials including:
1. Final changes to close out the FY22-23 County Budget, including changes to revenues, appropriations, and obligated fund balances; and AUTHORIZE the Auditor-Controller to make the necessary changes in the financial accounting system, as reflected in Attachment A;
2. Final changes in the FY23-24 County Budget, including designations and changes to appropriations, revenues, and obligated fund balances; and AUTHORIZE the County Administrator and Auditor-Controller to make technical adjustments to the budgets pursuant to Attachment B (County - Schedule A, B, and C);
3. Final changes to close out the FY22-23 Special Districts Budget, including changes to revenues, appropriations, and obligated fund balances; and AUTHORIZE the Auditor-Controller to make the necessary changes in the financial accounting system, as reflected in Attachment C; and
4. Final changes in the FY23-24 Special Districts Budget, including designations and changes to appropriations, revenues, and obligated fund balances; and AUTHORIZE the County Administrator and Auditor-Controller to make technical adjustments to the budgets pursuant to Attachment D (Special Districts - Schedule A, B, and C);
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I hereby certify that this is a true and correct copy of an action taken and entered on the minutes of the Board of Supervisors on the date shown. |
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ATTESTED: |
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Monica Nino, County Administrator and Clerk of the Board of Supervisors |
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By: |