“The county financial picture is stable, and discretionary revenue is slightly better than expected,” county Chief Executive Officer Jeff Van Wagenen said during the board meeting Tuesday. “But the cost of county services is growing faster than revenue sources.”

The $38 million shortfall highlighted in the midyear budget report’ stemmed from mounting cost obligations that the following county agencies were unable to meet from the Department of Public Social Services, District Attorney’s Office, Office of the Registrar of Voters, Riverside University Health System and Sheriff’s Department.

In a 5-0 vote, the board rectified the composite imbalance. About two- thirds of the deficit will be reduced by drawing down General Fund reserves. The remainder of the hole will be plugged with the agencies’ reserve accounts, according to documents posted to the board’s agenda.

“We’ll need to approach the upcoming budget cycle with discipline,” Van Wagenen said, pointing to decreases in federal funding for some programs, like Medi-Cal, and the anticipated decline in interest earnings on bonds while financial pressures persist. “Our general fund budget is still not structurally balanced. The reality is, things cost more, and there’s less money to pay for those things.”

On Monday, all county agencies submitted their budget requests for the 2026-27 fiscal year, and the CEO acknowledged higher outlays will be sought.

The midyear report indicated revenue streams had grown in a few places, principally property taxes, which increased nearly $19 million above the amount first projected at the outset of the fiscal year. That will translate to a 3% rise in discretionary income — $1.35 billion instead of $1.31 billion — by the end of 2025-26 on June 30, officials said.

The county’s composite reserves should reach just shy of $700 million at the end of 2025-26, compared to $655 million at the beginning. Van Wagenen attributed the positive shift to the fact that agencies returned a little more money to General Fund coffers than had been predicted at the end of the previous fiscal year.

The board had formally approved the 2025-26 budget, totaling $9.98 billion, on June 24. The supervisors further approved a tentative hiring freeze for most agencies to put the brakes on deficit spending.

Payrolls continue to consume half of outlays. The county employs nearly 26,000 people on a regular or rotating temporary basis

More than two-thirds of the county budget is composed of programmed spending, including federal and state earmarks for specific uses, along with grants and related external source revenue. The board has little control over those dollars.

Hearings on the 2026-27 fiscal year recommendations for all county agencies are scheduled for the second week of June, followed by tentative adoption of the new budget on June 23.

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In a 5-0 vote without comment Monday, the board cleared the Executive Office to implement the “cleanup” allocations connected to expenses that weren’t on the books when the 2024-25 fiscal year officially concluded on June 30.

The irregular Monday meeting was scheduled because of an unexpected cancellation of the Sept. 16 meeting, which stemmed from supervisors’ absences and the lack of a quorum for votes. Meetings are generally always held on Tuesdays.

“While most adjustments are resolved during the year, certain year-end adjustments, often resulting from unanticipated costs in the final fiscal month, require board approval to ensure that all budgetary units remain balanced,” the Executive Office said. “(We) request board approval to increase appropriations where necessary to address these final adjustments.”

The board formally approved the 2025-26 budget, totaling $9.98 billion, on June 24.

Generally every September, the EO identifies a series of budgetary holes that require draws on the General Fund or reserve accounts to fill.

The agencies currently requiring delayed appropriations include the Office of the Public Defender, the Emergency Management Department, the Department of Code Enforcement, the Fire Department and multiple others. Three-quarters of the $78 million in required infusions will be from the General Fund, while the remainder will be from contingency accounts, as well as the individual agencies’ own appropriations for the current fiscal year, according to officials.

The board approved a tentative hiring freeze in 2025-26 for most agencies to limit outgo in the face of an anticipated deficit.

“The freeze … will require (some departments) to shrink by attrition,” county CEO Jeff Van Wagenen said. “Revenue is not decreasing across the system, but we are seeing it flatten and go down in certain areas.”

The last payroll pause to rein in spending occurred in 2016-17, and he said that saved $40 million to $50 million.

The current deficit stems from “inflationary pressures, growing labor costs, unpredictable state and federal funding and necessary investments in aging infrastructure (that) strain our financial capacity,” according to the 500-plus-page budget book.

The Executive Office predicts a year-end reserve pool of $655 million. It had been projected at $728 million, but the total will have to be pared down to fix the gap.

Payrolls continue to consume half of outlays. The county employs 25,632 people on a regular or rotating temporary basis.

More than two-thirds of the county budget is composed of programmed spending, including federal and state earmarks for specific uses, along with grants and related external source revenue. The board has little control over those dollars.

Direct property taxes remains the county’s largest source of discretionary income. It rose to $574 million in 2024-25, compared to $542.6 million in 2023-24, according to figures. The projection is for a $54 million, or 10%, jump in 2025-26.

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The county’s Department of Environmental Health Director, Jeff Johnson, says there are just under 7,000 residents in unincorporated communities who owe the county’s four waste haulers for rubbish pickup and disposal services in 2024.

The arrears in unpaid bills range from a low of $150 to a high of $10,300 per customer, according to the proposed special assessment documents.

Jouhson asked for the public hearing for the board to approve the assessments, which would be added to the annual property tax obligations of delinquent payers. He noted that “regular removal of solid waste from residential properties is a basic sanitation practice that protects both the environment and the public.”

“The mandatory collection of solid waste and the payment for the collection are critical,” he said.

The hearing will provide an opportunity for ratepayers to present their cases against assessments, offering specifics about mitigating circumstances, including how their finances have been impacted by inflation and other factors over the last year, to the extent that they have been unable to meet some obligations.

In the past, petitioners have presented appeals to the board, arguing that they shouldn’t be held responsible for the costs incurred by waste haulers, as they oversee their waste disposal. Sometimes, properties are also under lease, and the owners aren’t responsible for paying trash disposal charges.

Former Supervisor Kevin Jeffries often pointed out instances in which haulers were charging for services never rendered, failing to pick up garbage regularly, yet still charging as if they had done so.

If the board authorizes the special assessments after the hearing is closed, an additional $82-per-parcel charge would be applied to delinquent bills to cover the cost of public noticing and county staff time.

Officials said residents can avoid the supplemental charge by paying their bills in full on or before July 25, which for some could be prohibitive.

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In a 5-0 vote without comment, the board signed off on the sheriff’s 7% increase in the base hourly rate charged for the use of patrol personnel. The augmentation, which officials said is needed to recoup higher costs incurred by the department, will be retroactive to July 1, 2024.

Under the revised rate schedule, the cost of a sheriff’s patrol deputy will rise from $214.47 per hour to $229.55 per hour.

“Each year, the Sheriff’s Department does an analysis of just its patrol operations and determines real costs effectively through its sheer size,” according to an agency statement posted to the board’s agenda. “The fully supported contract law enforcement rates include the entire systemic costs involving the running of the department.”

Last year’s hike was about 2.5%, driven in part by greater “pension obligations and salary increases” obtained by the Riverside Sheriffs Association for the several thousand deputies it represents, and the costs of increased pensions and salary hikes for executive-level personnel represented by the Law Enforcement Management Unit.

In 2015, a similar 7% hike prompted an outcry from elected and non-elected officials in Indian Wells, Lake Elsinore, Moreno Valley, Palm Desert and Temecula, who challenged the justification for such a significant upward adjustment. They protested that law enforcement expenses were draining their budgets and needed to be capped.

The objections led to a two-year assessment of sheriff’s operations conducted by Netherlands-based professional services firm KPMG, at a cost of nearly $40 million. After the company’s audit and recommendations, some sheriff’s management practices were changed, and adjustments were made to deputies’ schedules and assignments at several stations to save money. However, the KPMG work was criticized by the county Grand Jury and other sources, including then-Supervisor Kevin Jeffries, as excessively expensive with very limited results.

The city of Menifee in 2020 abrogated its contract with the county for law enforcement and formed a stand-alone police department.

Cities receive the benefit of helicopter patrols, robbery and homicide investigations, SWAT unit and bomb squad responses without having to foot the bills individually. Contracting entities are further spared the direct cost of lawsuits stemming from the actions of sheriff’s personnel, according to the agency.

In addition to approving the increase to patrol deputy rates, the board affirmed the sheriff’s proposal for the 16 municipalities under contract with the county for law enforcement services, along with two Native American tribes and three community services districts, to pay higher or lower sums for the sheriff’s use of facilities dedicated to servicing them.

Officials said heftier bills generally stem from county Department of Facilities Management costs to maintain stations, including lights, waterworks, landscaping and custodial operations. The sheriff initially carries the expenses, then passes them on to the contracting parties, each of which is invoiced in proportion to how much it consumes.

The largest percentage increase in facilities costs this year will be borne by Moreno Valley, which is facing a $156,652 bill, compared to $130,198 the previous fiscal year — a roughly 20% jump.
Perris will bear the highest facilities charge in dollars and cents — $625,627. That’s a 5.3% increase from the previous fiscal year, when the city paid $593,642.

Other cities — Calimesa, Norco and Rancho Mirage — are slated to net savings in facilities charges for the current fiscal year, according to sheriff’s documents.

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RIVERSIDE COUNTY, CA — The Board of Supervisors Tuesday approved roughly $1.6 million in appropriations to fill early gaps in the current fiscal year budget, drawing down the county’s cash reserve, without notable impacts to the General Fund.

In a 4-0 vote without comment — and with Supervisor Karen Spiegel absent — the board signed off on the Executive Office’s expenditure request as part of a first-quarter 2024-25 “clean-up,” which typically occurs every September, after the state’s budget for the new fiscal year is in operation.

The appropriations will reduce the contingency cash balance from $7.5 million to $5.9 million, according to the Executive Office. The largest share of the outgo will be for costs tied to the March Air Reserve Base Joint Powers Authority, as part of an ongoing revenue sharing agreement, officials said.

Despite the draw-down, General Fund inflows and outflows for the current fiscal year remain on track, and in a few cases, agencies identified higher estimated revenues. There was no projection for a significant change in the $9.2 billion appropriations blueprint approved by the board in June.

The current budget represents an 11% increase over the 2023-24 spending plan.

One of the bright spots for the current fiscal year is the county’s reserve pool is expected to hit $698 million, compared to $590 million at the end of 2022-23. Executive Office staff estimated county discretionary revenue — which, unlike programmed funding, the board may use for any purpose — will top out at $1.22 billion, a $100 million increase over 2023-24.

County CEO Jeff Van Wagenen confirmed at the end of June there are remaining 2021 American Rescue Plan Act funds in the county treasury, but they’ll have to be spent by Dec. 31. The county received $480 million in ARPA allocations and another $500 million in 2020 Coronavirus Aid, Relief & Economic Security Act money. The federal infusions have been applied to “budget stabilization,” community development, infrastructure projects and related programs.

Under the current budget, $2.6 billion is going to the Riverside University Health System, the largest set-aside in the spending plan, at 27% of total expenditures. The outgo translates to a 5.6% increase in healthcare-oriented obligations.

Public safety agencies are next, with $2.2 billion in expenditures, 8.5% more than last year’s outlays and 23% of the composite budget, while the social services portfolio will get $2.1 billion in General Fund receipts, also representing an 8.5% increase compared to 2023-24 and comprising 21.4% of the budget.

A quarterly report on county finances is due in November.

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Riverside County government’s income will be higher than originally expected — by almost $100 million — as the current fiscal year draws to a close, but “financial pressure” continues to build as priorities demand more outlays, according to a report that the Board of Supervisors will review Tuesday.

The Executive Office’s 2023-24 third-quarter budget report will be among the top items on the board’s agenda. It will be the final analysis of existing finances prior to the start of 2024-25 budget hearings next month.

“While the near-term financial outlook appears stable, challenges are looming in the years to come,” the EO stated in the 50-page report. “While we are projecting increases this fiscal year and next, it should be noted that the pace of growth is slowing, while costs continue to rise to maintain the status quo, let alone increase service levels. Additionally, the need to maintain or replace our aging facilities adds financial pressure.”

Aggregate discretionary revenue is projected to reach $1.224 billion, just over $80 million more than first estimated at the beginning of the current fiscal year, when officials expected inflows by June to total $1.14 billion.

According to the report, property tax revenue, motor vehicle in lieu of property taxes and interest earnings on county treasury pool investments are all coming in at higher levels, driven in part by inflation.

There was no reference in the third-quarter update to the state’s sizable budget deficit, which the California Legislative Analyst’s Office estimated to be $68 billion, and how that may impact funding levels for a number of state-supported programs countywide going into 2024-25.

The board generally has a free hand in allocating discretionary funds, as opposed to programmed, or non-discretionary, appropriations, which are earmarked for a range of social, health and other budget mechanisms.

The 2023-24 budget is roughly 15% larger than 2022-23’s, which was about $7.45 billion.

A bright line in the midyear budget report issued in February was that aggregate reserves would likely reach $677 million, as opposed to the initial prediction of $555 million, by June.

The county received almost $500 million in 2020 Coronavirus Aid, Relief & Economic Security Act allocations and another $480 million in 2021 American Rescue Plan Act money. Just under 10% of the federal infusions have been applied to “budget stabilization.” Some of the revenue remains available and is being allocated to community development and related programs.

The funds were previously used for homeless and rental assistance programs, along with other social welfare efforts, but they’ve also been appropriated for capital improvement projects.

Hearings on the proposed 2024-25 fiscal year budget are slated for June 10-11.

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“We’re not using only the consumer price index model,” agency Director Jeff Johnson told the board. “We’re looking at the costs and assignments on our end … (which are) variable across different aspects of what we regulate.”

Johnson emphasized the department did not seek any fee adjustments for the current fiscal year and is now seeking to offset expenses that have grown beyond what the agency can absorb and stay within budget.

“We go back and analyze what we do. We ask if we can do some things better, create efficiencies,” he said. “That’s why I didn’t come here last year and ask for a CPI adjustment. We’ve had to absorb costs internally, but we’re a lean machine.”

Supervisor Kevin Jeffries applauded the efficiency goal, saying he has never liked going along with other board members in applying a “rubber stamp and not ask what’s driving increases.”

“Anything that leads us to a process where we can see where the revenue challenges and the shortfalls are … is a benefit,” Jeffries said.

The permit and inspection fees the department is seeking to increase cover a broad regulatory scheme, from food facilities to farm stands, and swimming pools to septic tanks.

Among the higher fees slated for an increase is the permit for a community temporary event. The greater the number of vendors, the bigger the cost for a Department of Environmental Health review. A permit for an event featuring 26 to 30 vendors would go from $3,644 to $3,863, while an event with 56 to 60 vendors would rise from $7,202 to $7,634.

A catering permit would go from $527 to $563, while a produce stand permit would only rise $9 to $398.

The cost of a permit to sell unpackaged edibles from a mobile food facility would increase from $589 to $624, and to host a certified farmers market, a $543 fee would be required for a permit, compared to $522 currently.

The cost of a permit for installation of an underground storage tank would jump from $1,328 to $1,380, and the fee for closing an underground system would go from $944 to $962.

Among the smallest increases was for food handler certification, which is a $27 fee. It would bump up to $28 under the proposed amendments.

A few fees would be left unchanged, including the $140 inspection fee for a mobile home park and the 10-cent per page cost of clerical records supplied by the department.

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The board of supervisors today approved the last funding agreement needed to expand a two and a half mile sewer project along Van Buren Boulevard in the county’s unincorporated Woodcrest area, adjacent to the City of Riverside.

The Riverside County Office of Economic Development is connecting the City of Riverside with Riverside County Flood Control District to allocate the last $3.5 million to improve water quality and bring this critical sewer project to fruition.

“We have several interested business operators who eagerly want to start business in this area, but they haven’t been able to get started without sewer,” said Chair Kevin Jeffries, First District Supervisor. “If we build this sewer system, they will come, and our residents will have businesses closer to where they live. In addition, this sewer system will have an immediate positive impact on a local public school that can now move off septic.”

The county and city agreed last year to jointly fund the project. However, increasing construction costs meant that an additional $3.5 million was needed. Today’s board action ensures the final funding amount will be covered by the Riverside County Flood Control District, due to the positive benefits sewer systems have on water quality.

The general area of the sewer project currently relies on individual septic systems for wastewater disposal. Such septic systems are not able to support the number of residents, employees or business operators who will visit future businesses along the area. In addition, septic systems for large development include water quality concerns and other factors impacting septic system performance.

“The ability for a business, or even a home, to connect to a sewer system can make or break the chance to even get started,” said Supervisor Karen Spiegel, Second District Supervisor. “Those who will benefit daily from this project, are the local residents who will have shorter commutes to reach basic business services.”

The City of Riverside’s Public Works department will complete the expansion of the sewer system already in existence along Van Buren within the city’s boundary. The total cost of the project is $21.8 million, of which the county will contribute 46 percent, including today’s allocation of $3.5 million from the Riverside County Flood Control District. The county’s total contribution is approximately $10 million. The City of Riverside’s contribution is 54 percent, or $11.8 million.

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RIVERSIDE (CNS) – Riverside County supervisors signed off today on an Executive Office response to a grand jury report critical of the way the Department of Animal Services handles payments collected by its officers in the field, citing safety and efficiency concerns.

On a 5-0 vote without comment, the Board of Supervisors certified the county’s answer to the civil grand jury, which is near the end of the last fiscal year issued findings that focused on alleged deficiencies regarding how payments are collected and processed by animal control officers.

The county’s three-page answer to the panel stated that the issues which jurors found concerning have either been resolved or are close to resolution.

The 19-member grand jury, which has Superior Court authority to investigate almost any matter of concern in county government, said it could not identify a specific written policy establishing how animal control officers are supposed to manage receipt of payments for various services while in the field, including pet surrender fees, owner redemption fees, and euthanasia fees, all of which can run anywhere between $40 and $150.

The main concern pertained to cash handling and how officers secure cash to ensure it isn’t lost or stolen. According to Executive Office staff, a policy does exist, and it instructs officers to lock money inside a box bolted inside each animal control patrol vehicle. Accepting credit card payments in the field, which would likely eliminate cash transactions, remains a challenge because most of the county’s three-dozen animal control officers are not trained to use Internet-based software that can be loaded onto their tablet devices to process charge card payments.

Officials said the Department of Animal Services is working to have all officers trained in the mobile Converge credit processing system by Dec. 31.

The grand jury concluded that the cash-based system was “cumbersome and unsafe,” with many officers and supervisory personnel unhappy with managing and keeping track of dollar bills. Jurors also found how receipts are recorded in the department’s database to be “time-consuming and inefficient.”

Executive Office staff said that, even with full implementation of the mobile processing system in the field, all types of transactions will still need to be entered into the agency database.

“Without this information, no official record will exist of the transaction,” the staff wrote. “These records are vital to know the status of animals, such as if they are licensed, have bitten anyone in the past, or have violations of law pending against them.”

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