The forecast for Alameda County’s short-term fiscal health will come into focus this week and it could be sobering news for those who depend greatly on the county’s safety net services. County supervisors will learn at a budget workshop session on Thursday the extent of the damage caused by covid-19 on the local economy.
Last week, Alameda County Administrator Susan Muranishi issued yet another grim outlook on the county’s financial future, that follows large estimated budget shortfalls in Oakland and BART.
Muranishi said the impact of covid-19 on the county is already “both visible and significant.” Earlier this month, Muranishi told the Board of Supervisors that “we probably have more than a recession.”
Sales tax revenues are down significantly, property tax receipts are less than a year ago, and the damage could affect the county’s sterling credit rating, a financial mechanism that allows the county to save money with low interest bond rates, Muranishi said.
“For the short term, sales receipts are expected to slow down, payments are being deferred, property tax collections, as reported by the treasurer-tax collector are lower than last year,” Muranishi said.
“The county is receiving daily notices of businesses advising us of temporary and permanent staff reductions. And while state and federal stimulus money may come the county’s way, it will mostly cover expenses due to covid-19, and will not replace lost revenues.”
Muranishi had previously told the board of supervisors that the county is burning through cash reserves at a rapid rate in order to cover emergency spending that will be mostly reimbursed by the state and federal governments.
The county recently processed 1,200 payments for its community-based organizations (CBOs), totaling almost $90 million, Muranishi said. The non-profits are an important deliver system for the county to administer services for low-income residents, children, seniors and the disabled. A plan for funding CBOs through June 30 will come before the board soon, Muranishi added.
Exactly how large the next fiscal year budget shortfall will be is unknown and county leaders are typically mum about revealing the figure prior to its budget workshops. However, a bit ominously, last year’s budget shortfall was just over $60 million in the middle of a robust local economy. During the height of the Great Recession more than a decade ago, it topped $177 million.