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But county officials can't always afford enough probation officers to watch everyone who should be in the new hall. Some troubled kids have been released early.
It's just one example of a looming problem for Fresno County's government. Most years, the budget goes up -- it's a record $1.74 billion this year -- yet services sometimes go down.
Past decisions to expand the work force, guarantee raises and enhance the pension system -- along with years of delaying construction of county buildings -- are driving much of the stress. Officials in 2000 boosted retirement benefits to some of the richest levels in the state -- creating a system that will cost the county an estimated $141 million this year, nearly double what it paid three years ago.
Members of the Board of Supervisors say the county has managed well under tough conditions partly created by the ebb and flow of state finances. They say they're working to control employee costs, raise fees and find options for strategic cuts and more efficient ways to work.
But critics, including some running in June for seats on the board, blame supervisors for woeful oversight. The county, one says, "kept spending like a drunken sailor."
Regardless of the reason, there's no question that the cost of doing business is rising faster than the cash coming in. Authorities this year couldn't maintain what they had, much less find money to expand services in a county that has added more than 100,000 people since 2000.
Despite an extra $70 million this fiscal year, which ends June 30, the county fell $40 million short of preserving the status quo. Today, park workers can't keep up with dirty bathrooms. Code enforcement officers fall behind on complaints. Fewer nurses treat the mentally ill.
Curtis A. Thornton, a member of the county's mental health board, lamented cuts in behavioral health spending: "It has not been a cosmetic trimming. It has been a real hacking job."
Both the Fresno County Grand Jury and Greater Fresno Area Chamber of Commerce have voiced concern over county finances. And some ordinary residents smart over the cutbacks and spending choices.
"We don't feel we get the services we pay into," said Bonnie Hancock, a foothill resident and retired correctional sergeant.
The fiscal year that begins in July could be even more bleak if a state deficit projected by Gov. Schwarzenegger at up to $14.5 billion -- coupled with sinking property and sales taxes and the downturn in the housing market -- stomps on local budgets.
Daniel Mitchell, a professor of management and public policy at UCLA, said the county ultimately has two choices -- raise more or spend less. "Counties are more like households -- there's only so far you can go before you're in deep trouble."
The problem
Fresno County's budget has grown nearly every year over the past decade, ballooning from $825 million in 1997-98 to today's $1.74 billion.
Many years, county leaders struggled to balance the budget -- cutting or freezing empty jobs and raiding other departments for cash to put into public safety.
Technically, only 25 people left county work as a result of cuts over the past six years, but those figures don't include some types of employees. This year, for example, two lawyers were let go from the county counsel's office. Those aren't considered layoffs because lawyers are at-will employees.
The county's general reserve -- essentially a fund for financial stability and emergencies -- shows the budget strain. At about $8 million, the fund is too small, officials say. They put in $1 million this year and plan to add more.
Auditor Vicki Crow said similarly sized counties generally have $30 million to $40 million in reserve, and "I think that ought to be our target."
Much of the budget relies on state or federal money that powers welfare, health and other mandated programs. Those services typically expand or contract with the funding.
The big challenge is paying for services that rely on the most discretionary dollars. About 20% of the budget, or about $350 million this year, is discretionary -- cash that leaders mainly spend as they please. About 65% of that money goes for salary and benefits.
Departments such as the sheriff, agriculture and county clerk compete for that money. Most goes to public safety, the board's top priority, sometimes at the expense of other departments.
This year, officials said during budget hearings, the county needed 19% growth in discretionary cash to maintain service levels. Growth was 4%.
The Sheriff's Department wanted more than $21 million to preserve the status quo but ended up with $12 million. Most of the extra cash was tied to raises and retirement benefits for about 1,200 employees.
Less discretionary money is available in part because the county pension system demands more cash. Last summer, County Administrative Officer Bart Bohn called the required contribution to the system the "single most significant cost increase" in this year's budget.
The county expects to pay $141 million in retirement contributions and debt service on pension bonds this year. The bill next year is projected at about $150 million, more than triple the cost in 2002-03.
Officials say escalating salaries, market losses and changes in assumptions -- such as life span -- are inflating the cost.
In 2006, grand jurors called the pension plan "an employee's dream and an employer's nightmare." Noting the rate of borrowing -- about $730 million related to the retirement system over eight years -- jurors said the county could soon face "insurmountable debt."
That year, supervisors took a step to reduce the financial burden by negotiating lower benefits for most new employees in exchange for higher raises through 2010.
The retirement system burden isn't expected to ease for 10 to 15 years -- and the county already is feeling the pinch of those raises, which in the first year cost more than $1.4 million.
Sgt. Betty Moreno, who works at the county jail, said supervisors have given away so much to larger unions that they don't have much left for other employee groups.
"They've put themselves in a situation that now they're not going to be able to afford," said Moreno, who is part of an association that represents 34 sheriff's correctional sergeants. "They sign off on every pay raise, and then they cry about it afterward."
Henry Perea, chairman of the Board of Supervisors, defends the decision to trade raises for lower retirement benefits.
"I know there's been a debate around town about did we pay too much for it, because obviously we had to negotiate with the union," he said. "They wanted some carrots, we made a judgment call as a board."
Tom Abshere, director of the county's biggest union -- Service Employees International Union, Local 521 -- also defended the move. In the long run, he said, raises help the county avoid the cost of recruiting, hiring and training new workers.
But before the board approves more raises, Supervisor Judy Case wants an analysis of the long-term budget effects.
"I want to put the brakes on," she said.
No crisis, but concern
Perea and other county officials say Fresno County doesn't face a financial crisis. But the county's seesaw budget is generating concern, with supervisorial candidates in the June 3 election lobbing political grenades and business leaders lobbying for budgetary change.
In July, a Chamber of Commerce task force produced a report offering a series of findings and recommendations. Members said a common theme in meetings with county officials was that "the fiscal future of Fresno County might be at risk unless there were some major changes in the budgeting process and cost structure."
In part, the task force suggested bringing in a consultant to revamp the budget development process and curbing the use of one-time money to pay for ongoing programs or jobs.
Ray Dunn, current chamber chairman and chairman of last year's task force, said members wanted to convey that "the chamber feels you've got a major issue that you've got to deal with."
He hasn't gotten a formal response from the Board of Supervisors.
Some observers say the county is paying for a departure from its conservative roots. For decades, the county was guided by a pay-as-you-go philosophy. Modest raises. Modest benefits. No long-term borrowing.
Supervisors were considered so miserly that in 1997, hundreds of employees went on strike over salaries, benefits and working conditions. Following that, several incarnations of the board raised salaries and benefits and borrowed money to invest in the pension system and capital projects.
Perea believes all of the board's borrowing decisions have been sound -- especially those that led to new facilities. He said the county is now stuck paying for new buildings because of past neglect.
"You had services that were being provided to the public that were not optimal," he said. "You had employees that were working in work sites that were rat-infested -- they were working in desks from World War II."
But former Supervisor Sharon Levy believes board members paid too much for capital projects such as the new juvenile justice complex. Said Levy: "It's like when you grocery shop -- you only put into your basket what you can afford to pay at the checkout counter."
In political campaigns, the toughest budget talk comes from Brian Calhoun, a Fresno City Council member, and Paul Dictos, a certified public accountant, both of whom are challenging board incumbent Susan Anderson.
Calhoun said the board has exercised poor financial oversight. Dictos, who contends the board has spent like a "drunken sailor," has charged that the county exceeded the state-determined legal debt limit by up to $355 million.
County officials say they aren't in violation -- they say a county audit that reported excessive debt was erroneous -- and they have room to borrow more.
Anderson, who last summer voted against the current spending plan she described as an "Enron budget," stitched together with fake money, said her opponents "really don't know what they're talking about."
She and others say the county hasn't made major cuts, employees aren't overpaid and most problems stem from the state's failure to pay for the programs it requires.
Anderson said the county has managed well within its resources: "The county is struggling, as all counties are."
Statewide, many counties -- including some in the Bay Area and Southern California -- are reeling from labor costs and downturns in the economy and housing markets. But officials in counties near Fresno generally paint a brighter picture.
This year, for example, Kern County gave $13.7 million to a new gang initiative, Merced County extended library hours and Madera County created new jobs in its Resource Management Agency.
Various officials in those counties say they have worked to closely match expenses to annual revenue projections, and save money to help hedge against problem years.
In Kern County, an oil-related revenue stream typically adds $55 million to $60 million annually to the budget. County officials don't spend it all each year, instead using some to help beef up reserves to $48 million, spokesman Allan Krauter said.
They may need to dip into those reserves next year to cover a projected shortfall, he said.
In Tulare County, top administrator Jean Rousseau said the past housing boom has helped fuel recent good times: "We've been as healthy as we've ever been."
Rousseau said the county has improved salaries and benefits and kept enough in reserves to help cushion the blow from expected state cutbacks next year.
"We feel that we can cover next year's budget and maybe cover a little bit of state reductions," he said.
Juggling act
In Fresno, the county balanced its books this year by purging hundreds of empty jobs, holding open other positions and sacrificing some supplies. It's a familiar juggling act.
In 2002, for example, officials took $5.8 million from reserves to keep 87 social workers on the payroll. The next year, they used $4 million earmarked for the new juvenile hall to avoid layoffs. In 2004, they siphoned $24 million from other departments to restore law enforcement jobs.
One hard-hit area over time is behavioral health, a department largely funded with state and federal money. In 2006, the county cut 75 mainly vacant jobs -- such as mental health nurses and clinic workers -- trimmed hours at rural clinics and eliminated some support groups.
Some residents are frustrated by the lack of services available to thousands of adults living with illnesses such as schizophrenia, bipolar disorder and severe depression.
Kristen Martinez, whose 11-year-old daughter has bipolar disorder, said people aren't getting what they need.
"Unfortunately, mental health seems to be what's taking the cut," said Martinez, co-director of the National Alliance on Mental Illness in Fresno. "You never know what's going to happen next. It's scary."
Even in better years, such as 2006-07, officials struggle to find ways to expand. For example, the Sheriff's Department wanted millions to hire new patrol deputies. Instead, the department replaced about 40 deputies who guarded inmates in the jail and hospital with 30 lower-paid correctional officers -- freeing money for additional patrols.
Other departments, particularly smaller ones, have fewer options. The result: service cuts that are increasingly apparent.
In public works and planning, officials say they have little cash for park maintenance. They can't afford to buy fertilizer for the grass, keep park bathrooms stocked with toilet paper or replace vandalized picnic tables.
Visitors notice bathroom conditions. At Lost Lake Park, Albert Moreira Jr. of Fresno said: "I'd rather go to the gas station."
Residents often get slow responses from code enforcement, which investigates potential violations ranging from too-tall fences to cars parked on lawns.
In the Sunnyside area, the neighborhood association now sends informal letters to offending homeowners. Resident Karen Musson said the county "just doesn't have the manpower to investigate."
This year, the public health department budget fell $8 million short. So officials closed a tuberculosis testing clinic and dropped two mobile dental trucks that treated low-income children in rural areas.
The county now has a "mobile" dental chair permanently anchored at Mendota's McCabe Elementary School because there's no money to move it.
In the agricultural department, farmers now may wait longer for inspections on shipments to other countries. Stace Leoni, an ag biologist in the department's Reedley district office, said inspectors have worked past midnight to finish time-sensitive certifications.
Pat Ricchiuti, president of Clovis-based P-R Farms, said it's more expensive to deal with the county because of rising fees. Farmers often need to coordinate several inspectors to sign off on shipments to foreign countries.
"There's times when you'll miss [shipments] for a day because they got too busy and got delayed too late in the day," Ricchiuti said. Stalled or canceled shipments cost a grower money.
Though supervisors say it's the No. 1 priority, public safety hasn't been immune from cuts. For example, Probation Chief Linda Penner this year closed 30 detention beds to cover a $500,000 shortfall -- limiting space available for juvenile offenders.
She also persuaded Fresno Unified to pay $150,000 toward keeping eight probation officers on campuses. Negotiations continue with Central Unified, but Clovis Unified declined the cost-sharing deal. The officer once stationed at Clovis' continuation high school now spends less time there; he works out of the city's police station.
Next year
According to Schwarzenegger, the state faces a roughly $14.5 billion deficit in the coming year. The Legislature has already reduced the shortfall by $7 billion, and the governor's proposed 10% across-the-board cut to most state-funded programs -- including many social services and health programs administered by counties -- is aimed at making up the remaining $7.5 billion.
"We've proposed a number of difficult decisions," state Department of Finance spokesman H.D. Palmer said. "In terms of what's going to happen ... it's too early to tell." The Legislature will craft the budget and then ask the governor to sign off.
Some county leaders say residents can expect even less if the governor's plan goes through.
"We're going to have to make government smaller in the county," Supervisor Phil Larson said. "That means less service to the public."
Beyond the state budget, the county is dealing with other financial strains -- such as a drop in property values.
Fresno County Assessor Bob Werner anticipates lowering assessments on about 40,000 to 45,000 mainly residential parcels. State law allows local officials to reduce taxes to reflect falling property values.
The move likely means a $1 billion to $1.5 billion hit on the county tax roll next year, Werner said. Growth in the values of other properties, such as commercial and other residential parcels, should soften the blow.
Said Werner: "Even after we roll off that billion, we're still expecting about a 2% increase."
Still, growth has been 4% to 6% in recent years.
A newly formed committee of supervisors and county staff is working on next year's spending plan with the 23 county departments. In part, officials hope to create cost-cutting options and avoid the confusing, rancorous hearings that last summer produced a budget supported by just three of five supervisors.
Already, authorities know they will have nearly $5 million less in discretionary dollars next year. It's the first time in a decade that figure has declined.
Tuesday, supervisors will discuss options ranging from eliminating all vacant positions, shortening the work week and reducing the number of cars in the county fleet. Said Bohn: "Anything that saves money will reduce service levels. ... There won't be as many people behind the counter serving the public."
Last week, Bohn told department heads they can't hire new employees without approval from his office.
Committee members have declined to discuss potential cuts. Some department heads say they've been told to keep mum about budget preparations.
Board Chairman Perea, who in January described this year as "the year of the budget," said there are too many unknowns to talk specifics: "It's just so premature to say that the world is ending, the sky is falling."
But experts say local agencies will feel the pain if the state's gloomy financial situation doesn't improve.
"If I were a county official, I would be concerned," said Jean Ross, executive director for the California Budget Project, a nonprofit group that advocates for funding for the poor. "It is going to be a very tough year."
County departments are bracing for it. Coroner David Hadden said he can't afford any more cuts, because "we're just about as skinny as we can get."
County Clerk Victor Salazar worries he could lose several positions after trimming a dozen over the years. This year, the clerk services department cut 90 minutes from daily hours open to the public.
"Every year, we've had budget problems," he said. "What's different for us is that each and every year we have taken a budget reduction in some form or another, and at some point you get to a breaking point -- and that's where we're at."
The future
Fresno County faces other financial challenges in the future. After borrowing hundreds of millions for the pension system and new buildings over the past decade, it likely will need more outside cash for new projects.
Among those are a new morgue and coroner's facility that could cost up to $30 million. Adding new jail beds, and replacing two aging jails, could take an additional $200 million.
Officials also are considering new digs for public works and planning, the ag commissioner and district attorney.
Perea said the county can turn to borrowed money and other funds for construction. He said the county can increase efficiency, recover the cost of some services through higher fees and refuse to provide mandated programs that the state hasn't paid for.
Anderson said the county is improving some services through technology, enabling the public to find information online.
And there is talk of asking voters to approve a public safety tax and perhaps a hotel/motel bed tax, charged to out-of-town visitors. In 1996, supervisors killed the bed tax, which then generated nearly $600,000 annually in discretionary money.
But some supervisors may look for quicker -- and potentially unpopular -- relief. One option is to yank promised employee salary increases or spread them over more years. That doesn't interest union leaders.
But Supervisor Larson, during a March board discussion of probation manager raises, said: "There are a lot of things that have been negotiated that we may have to change because of budget constraints."
The reporters can be reached at cfontana@fresnobee.com, kginis@fresnobee.com or (559)441-6330.
To see more of The Fresno Bee, or to subscribe to the newspaper, go to http://www.fresnobee.com Copyright (c) 2008, The Fresno Bee, Calif. Distributed by McClatchy-Tribune Information Services. For reprints, email tmsreprints@permissionsgroup.com, call 800-374-7985 or 847-635-6550, send a fax to 847-635-6968, or write to The Permissions Group Inc., 1247 Milwaukee Ave., Suite 303, Glenview, IL 60025, USA.
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