BAKERSFIELD - Kern County supervisors declared a fiscal emergency at their weekly meeting and endorsed a plan for navigating the treacherous budget wilds ahead.

It's in response to predictions of a massive shortfall in property tax revenues because of falling oil prices. Oil companies account for about 30% of the county’s property tax revenues.

Falling oil prices are expected to strip about $61 million from county property tax revenues in the fiscal year that starts July 1, turning a robust outlook into a projected annual deficit of $27 million.

The fiscal emergency declaration gave supervisors the ability to spend reserves and get creative in staffing the Kern County Fire Department, which has to absorb $17 million of the $61 million oil tax drop.

But they also approved a long-term plan that will phase in reductions in county spending gradually, before the high-dollar cost increases hit.

It starts immediately.

County departments were directed to reduce their annual general fund spending by 1 percent. It's a blow to most departments with the exception of those that, like Public Health Services, are mostly funded by state and federal revenue.

Departments will also face increased pension costs.
"We're going to start feeling the pain earlier than we have to," Supervisor David Couch said. "Doing nothing and hoping it all works out isn't really an option."

In each of the next five fiscal years, all departments should expect to see an additional 1.4 percent cut in general fund spending, said Assistant County Administrative Officer Nancy Lawson. (Source: Bakersfield Californian)

Story Date: February 3, 2015