Santa Barbara County is on track to end its budget year in the black with a $11.9 million surplus, staff told the Board of Supervisors this week.
The second-quarter update, which covers the period ending Dec. 31, showed tax revenues $10 million over budget, driven by higher-than-expected property tax, transient occupancy tax and sales tax revenues, budget director Paul Clementi said.
He also noted that voters approved increasing the TOT rate to 14%, which taxes hotels and short-term rentals, and that took effect in January. The rate increase was expected to boost revenues by $3 million per year.
Cannabis tax revenues are below budget again, due to cultivators shutting down and delays in county-permitted retail dispensaries opening.
The county also reported lower-than-expected concessionaire revenues since The Ellwood restaurant at Goleta Beach County Park didn’t open until February.
The RV hookup revenues at Cachuma Lake are down by about $1 million because of closures for an improvement project. The work was supposed to be finished last summer, but now is expected to be done in May, due to electrical equipment delays, Clementi said.
He said county departments have an 11% staff vacancy rate, which is 533 positions. Some positions are empty intentionally because of funding uncertainty, some are recently vacant and in recruitment, and some are difficult to fill, he said.
The Sheriff’s Office, which has longtime staffing shortages and overtime costs, reported $16 million in overtime charges, and went $748,000 over budget.
Salary savings don’t entirely cover overtime costs because some positions are filled but staff are unavailable to work while they’re being trained, which can take months, Clementi said.
The Board of Supervisors heard the presentation at Tuesday’s meeting and voted to accept the report.
“This is a good time for a PSA: if anybody would like a job, we have 533 of them,” Supervisor Steve Lavagnino said.
“So I’m confused … I thought we were in financial ruin,” Supervisor Bob Nelson said. “I was just reading the news, I’m sorry. We have a balanced budget and are likely to have a surplus at the end of this fiscal year? Wow, I’m sure nobody will talk about that.”
Santa Barbara County is expecting budget deficits in the near future, according to a 5-year forecast from January.
County Executive Officer Mona Miyasato anticipates a status-quo budget with no major cuts this year and next year, but deficits in future years because of increasing costs and revenues that can’t keep up.
Last week, the supervisors approved huge salary increases for themselves, and tied future compensation to Superior Court judge rates.
They also raised salaries for several department heads who were reportedly underpaid compared to similar counties. The increases collectively have a $652,450 annual cost, according to the county.
The supervisors will hold budget workshops in April to consider funding options for the 2025-26 fiscal year, which starts July 1.