Santa Clara County officials have approved a balanced budget for
2003-2004, but it may not be balanced for long. Officials cut
services and employed other measures to help offset a $156 million
shortfall mainly caused by slumping tax revenues. But they
’ll now cross their fingers and start preparing for impacts
expected to come down as the state tries to rectify its own
$38-plus billion shortfall.
Santa Clara County officials have approved a balanced budget for 2003-2004, but it may not be balanced for long.
Officials cut services and employed other measures to help offset a $156 million shortfall mainly caused by slumping tax revenues. But they’ll now cross their fingers and start preparing for impacts expected to come down as the state tries to rectify its own $38-plus billion shortfall.
“We now have to prepare for a second round of cuts in anticipation of the impact from the state’s budget problems,” said Acting County Executive Pete Kutras.
The budget, which begins July 1, totals approximately $3.3 billion.
A total of 845 positions – 290 filled – have been cut from the budget, but 180 employees are being transferred to existing vacancies with no loss in pay. Another 73 have already left the county and 37 face demotions or layoffs.
County officials said they were able to stave off at least 400 layoffs – at least during the short term – after the county’s largest employee union, the Service Employees International Union (SEIU) Local 715, voted to delay part of a previously negotiated pay increase. County executive managers soon agreed to forego any pay increases during the coming year.
“It is very encouraging to hear the announcement about the 175 executive management positions,” said Supervisor Liz Kniss. “This is the first time that this is being announced and it is important that our employees and members of our community recognize that we are all working together to address the budget shortfall.”
“Applause is in order,” said Supervisor Blanca Alvarado, Board chairwoman. “All of our employees are to be commended for pulling together to preserve services for county residents.”
The county also employed measures such as deleting vacant positions, tapping reserves, a hiring freeze and $10 million in one-time bridge funding to help offset the deficit.
Santa Clara County officials have estimated they could take a hit of as much as $100 million or more in lost revenues if the state withdraws payments it makes to local governments to help offset the effects of a previous decrease in the car tax or Vehicle License Fee.
State officials have proposed tripling the tax to restore it to 1998 levels and help plug their budget hole, but opponents promise to pursue a legal challenge or ballot referendum.
County officials said this year’s budget balancing actions are difficult because they follow $102 million of reductions and other strategies used to balance the budget in the 2002-2003 fiscal year.
