Redwood City – County Executive Mike Callagy today unveiled a $4.2 billion budget plan amid growing concerns the state might claim County revenue to balance its own books.
While the County continues to provide quality programs and services, Callagy warned the fiscal headwinds from a shortfall in vehicle license fees (a form of property tax) – coupled with state budget changes – threaten what is now a balanced budget.
“The current economic environment poses challenges for our County’s financial stability,” Callagy said. “We advocate for a cautious fiscal approach due to the challenging economic times we face.”
The Board of Supervisors will hold a public hearing on the proposed budget on June 25.
Headlining Callagy’s concerns: more than $100 million in vehicle license fee revenue that local officials say the state owes the County over two fiscal years.
Without the funds, budget officials will face daunting challenges that could result in cutbacks in key services and initiatives that include core programs addressing the housing and homelessness crisis. This key source of local revenue, accounting for 18 percent of the County’s general operating fund, is not included in Gov. Newsom’s proposed state budget, raising alarms not only in County Center but in cities across San Mateo County that face similar uncertainties.
More than 750,000 people live in San Mateo County and the budget touches nearly everyone. The County provides numerous health and social safety-net programs as well as operating restaurant inspections, adult protection services, elections, foster care, law enforcement services, fire protection and more.
The County also provides city-type services – public works, planning services, for instance – for those who lives outside of 20 cities.
Newsom this month projected a budget shortfall of about $56 billion over the next two fiscal years, which he plans to balance through $30 billion in ongoing and one-time spending cuts.
With budget hearings in Sacramento ongoing, how potential cuts in state funding will impact local programs remains uncertain. The fiscal picture could look far different in September when the Board of Supervisors will consider a final budget with revisions for the 2024-25 fiscal year.
Calling for “a balance between responsible budgeting and the continued delivery of essential services,” Callagy is recommending:
- Adding five positions to the Department of Housing to support efforts to increase the supply of affordable housing.
- Adding five positions to the Department of Emergency Management to bolster resilience measures and help residents plan and prepare.
- Adding two positions to the newly created Office of Labor Standards Enforcement, to help protect workers’ rights.
- A wide range of investments in capital projects to improve parks, complete the Cordilleras Health and Healing Campus,
At the June 25 meeting, supervisors also will consider staff recommendations on where to invest $12 million in services for children, families and seniors. Supervisors, as part of a year-long budget priority process, allocated the funds from the local Measure K half-cent sales tax in March and will now consider specific services.
The complete proposed budget is available here.
Visit the Office of Budget and Performance to view all budget publications.
Michelle Durand
Chief Communications Officer
mdurand@smcgov.org