Imminent Cash Crisis Puts County Services, Californians at Significant Risk

 

FOR IMMEDIATE RELEASE

January 8, 2008          

Contact: Paul McIntosh, CSAC Executive Director, 916/327-7500, ext. 506

 

Imminent Cash Crisis Puts County Services,

Californians at Significant Risk

 

SACRAMENTO - Many California counties will be unable to continue providing state and federally required services for California residents as the budget stalemate continues and the state ultimately runs out of cash.

 

“Across the state, counties are experiencing significant revenue shortfalls and rising caseload demands. They are taking dramatic steps to resolve their budget imbalances while maintaining services to the most vulnerable Californians,” said Paul McIntosh, Executive Director of the California State Association of Counties. “The state’s cash crisis will cripple county services, underscoring why we need a balanced budget solution now.”

 

Without a budget remedy, the state and local governments are unable to access credit markets to maintain the flow of funds, which ensures a wide array of government services are uninterrupted and construction of infrastructure projects can continue.

 

Counties continue to see dramatic increases in unemployment and foreclosures in their communities, along with significant reductions in property assessments and sales tax revenue. Cumulatively, these factors have lead to hiring freezes, furloughs and layoffs of county employees, and, an unprecedented demand for aid and services by Californians in need – many of whom are first-time applicants.

 

• In Contra Costa County, food stamp applications have increased by 65%.
• In Stanislaus County, 25% of the 525,000 county residents are receiving some form of government aid, such as welfare and indigent health care.
• Santa Barbara County is seeing its highest number of food stamp cases on record, up 16% since September 2007.
• Statewide, homeless assistance requests increased 26% from September 2007 to September 2008.

 

In addition, the fate of more than 2,000 infrastructure projects remains in jeopardy without a state budget solution. The major infrastructure bond package approved by voters in 2006, including Proposition 1B, provided a much-needed boost to the economy and jump started long-awaited capital projects throughout the state. Without the ability to sell the bonds these projects are expected to stall, adding to job losses and exacerbating the economic downturn.

 

“Funding for county services and infrastructure projects provides an immediate return on the state’s investment and then some,” McIntosh said. “That money is spent in local communities, providing a shot in the arm to the California economy when it needs it most.”

 

California counties recognize the unprecedented fiscal circumstances of the state and support resolving the state’s budget crisis in a balanced manner, with a combination of spending cuts and new revenues. CSAC urges the Governor and Legislature to continue working toward a budget solution and compromise that sets forth a path to rebuilding the state’s economy.

 

The California State Association of Counties, headquartered in Sacramento, is the voice of California’s 58 counties at the state and federal level.

 

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