SLO County’s disappearing budget surplus

May 18, 2015


Less than six months after the San Luis Obispo County Board of Supervisors awarded extra pay to all employees after staff claimed a $30 million budget surplus, the county is running in a deficit.

The county is currently facing a budget gap of nearly $9 million, due largely to mishandling of employee pay, according to a staff report for Tuesday’s board of supervisors meeting. As a result, the county will likely cut some services.

In December, the board unanimously approved one-time payments of $1,000 to all full-time employees and prorated payments to part-time employees. The county described the payments as offsets to rising health care costs. In all, the payments total more than $2.4 million.

On Tuesday, the board of supervisors is scheduled to conduct its third quarter budget review for the 2014-2015 fiscal year. A county staff report for the budget hearing states that approximately $8.8 million in unbudgeted expenses will come due by year’s end.

Of the $8.8 million in unforeseen expenses, approximately $7.4 million is attributed to the one-time payments and prevailing wage adjustments for county employees.

County administrators say they plan to account for $7.4 million of the unbudgeted expenses through expenditure savings. That entails leaving some county staff positions vacant and reducing services and supplies.

Unanticipated revenue will also help make up the difference. The county expects to raise $878,513 in unanticipated revenue, according to the staff report.

Additionally, staff is recommending that the board transfer $494,295 from general fund contingencies to offset the remaining unbudgeted expenses. Doing so requires at least a four-fifths vote, though.

Before the board approved the one-time payments for employees, Human Resources Director Tami Douglas-Schatz said county departments had built up savings which led to the $30 million budget surplus. Those monies could be passed to employees, she said.

Critics questioned the use of the funds, as well as the legality of making one-time payments to county employees. The California Constitution prohibits governments from dispersing money if there is no accompanying public benefit.

It is forbidden for state, county or city governments to gift public funds, except to orphans, abandoned children, the blind, the handicapped, families with a disabled unemployable father and to institutions serving them, according to Article XVI, Section 6 of the California Constitution.

A week after awarding county employees raises, the supervisors granted themselves salary increases of about $4,000 in yearly pay. The board approved its own raises on a 4-1 vote, with Supervisor Debbie Arnold dissenting.

The vote on the raises for employees and the vote on the raises for board members took place prior to Supervisor Lynn Compton taking office.


First of all, the Board of Supervisors gave the $1000 to employees when they didn’t want it. They did it because people, oh like nurses and other technical and licensed staff who are already underpaid, were asking if they could FINALLY get that COLA or raise after 6 years of nothing. They were funding open space projects, spending money on other fluff projects Health care benefits went up for a family of 4 by about $250 per month employee cost. The Board of Supervisors kept saying they didn’t have money, but hired a firm and lawyer to make sure employees looked greedy for wanting to negotiate for fair pay. Not 10%. Not even a set number really. Just look at numbers. See what the market says. Even social security recipients get raises based on the consumer price index every single year, and they complain that their social security isn’t keeping up with the cost of living. Imagine one bill going up by $250 a month (when in reality, water and all utilities in SLO county have gone up), and your pay is not.

So, rather than try and be fair, they knew the Public would be FURIOUS if employees got $1000 of taxpayer dollars as a one time payment to “offset” those increase healthcare costs. Then the Board of Supervisors gave THEMSELVES a 5% raise.

Now, the people who NEEDED raises at the County are not going to get a raise. Law enforcement and the attorneys are still bargaining. See, the “caring” parts of the County don’t want to be hated. They just want to help people. The salary is so terrible that there are more vacant positions than ever before. Go look. As for “safety” bargaining units, well, they “deserve” all those raises. And they will get yet another one. I just get all warm and fuzzy thinking about it.

So to summarize, that $1000 was not a “gift”. It was “piss off the taxpayer/25% omg healthcare cost increase money we so sorry you will pay this with no raise” money.

Tami Douglas-Schultz is scum. County employees were voluntarily taking time off without pay, doing anything they could for “the 7 year pain plan”. They were told to do their part so layoffs did not have to happen. As I said, they did this not realizing it would backfire on them. Now, if County employees have to pay this back, you might see a huge strike next year as people become completely fed up with being vilified by Public no matter what they do.


If anyone truly believes that they are underpaid they owe it to themselves and their families to find other employment. Most people in the private sector have had no raises in the last 6 years, including COLA. Income is down. Again, if you want a raise, learn a new, more valuable skill and find an employer that will pay you for it if your employer will not. Slavery ended in the 1800s.

Rich in MB

If you believe you are under paid…..quit and go get a NEW JOB you Government Hack Leaches! Yes You…firefighters….police….Nurses…school teachers….

Who do you think produces things for you to get your big fat paychecks and pensions?

It’s time to stop playing games and say it like it is….these “public servants” are now our Noble Lords robbing us blind!


amen bizpro! Don’t ask for a raise – raise yourself! That approach would never occur to a government employee however.


Once on the government teat, latch on and leave only IF/when the funding gets cut.


With slavery, people had a place to live, food to eat, and some degree of healthcare.

American corporatocracy conveys no such minimal needs, nor do they promise to do so.

No …you’re not ‘property’, you’re just rented and forgotten when of no further use.


It really sounds like a Socialist response. Nobody is entitled to food, a place to live or healthcare. Corporations are not obligated to provide it, nor should they. Everyone in this country is provided a free education. What they decide to do with it is up to them. Corporate America provides the pay and benefits that they must to hire the best people in their industry.


Negotiating happens everyday.

In business and personal lives, in Public and private sectors. If a private business boasts record profits and the employees that contributed to that success ask for a raise, shouldn’t the private sector business at least ENTERTAIN that? Likewise, the BOS and the County were boasting that their “pain plan” had worked! All of the efforts of employees by taking time off without pay, some agreeing to postpone COLAs until things got better, they were all “very much appreciated”. So, hearing of a 30 million dollar budget surplus, combined with some job classes losing public employees to the Private sector and unable to replace those employees, made it REASONABLE to look at raising pay.

I think hardworking employees in ANY sector with an education and strong worth ethic should be able to negotiate. If negotiating is only for the greedy, then why doesn’t everyone just pay the asking price for homes, for cars, for anything?

Is negotiating only “ok” for sexually active City Managers, or for ticket quota setting Chiefs of police? Is negotiating only for people like Donald Trump, who has filed for bankruptcy 4 times, but keeps all his money because he is not the corporation, therefore is not responsible for his debts? Why CAN’T professional, middle class employees (many with masters degrees and multiple degrees) able to ASK without being deemed greedy?

The employees have done nothing wrong. AGAIN, it is people in power who make decisions. Why vilify the every day worker?


No, record profits should not lead to raises. There is process utilized for reviews, promotions and pay increases. That is when the raises are given. How on Earth could you manage daily demands for pay increases. If a company has record profits, it is due to their position in the market, effective leadership, and the employees. If the employees are paid wages at the prevailing market level, they deserve nothing more if they have not personally contributed at a rate higher than their competitors. The time for them to negotiate is at the time of their annual review. The negotiation works both ways. The employer can say no. If that is the case, the employee can move on. Nothing wrong with that.


And I agree with you.

The employees were ASKING at the 2 year negotiating time. The old contract was up, and it was time to write up the new one. This wasn’t something unusual. The other issue you brought up is “prevailing wage”. When an employee’s salary is below fair market value/ prevailing wage salary in ALL sectors, and your employer boasts 30 million dollar surplus when they asked people who had not had a real raise in 6 years to volunteer time off, to do everything they could do to help get the budget back on track, it is only fair to ask for changes to pay. It is of mutual benefit to do so. The employee feels their voice is heard regarding pay and competition. They will be more likely to stay and work for an employer that will sit down at the table. An Employer will benefit because they can be made aware of fair market wages so that they can recruit and retain “the best and the brightest” in ANY sector. The cost of retraining a new employee can be very costly, especially if they don’t work out, or if they get trained and move to a higher paying job before they have “paid for their training”.

Had the County had fair negotiations, they would not have felt the need or desire to pay out 1k to each employee (which they did not ask for and did not want). It doesn’t make sense to give out that money. The $1000 got in the way of that. In December, the County and BOS were sure to make their “gift” (though they didn’t call it a gift) LOUD AND CLEAR and timed around the holidays as to make the public PISSED off. It stopped any idea of fair negotiations dead in the water.

Let’s be honest. I could name any job class; microbiologist, social worker, Nurse Practitioner, Mental Health Therapist. Are these the “leeches”? And if I told you that in any other county they were paid about 10% more and in the private sector they are paid 15-20% more, do they STILL not have a right to ask for more pay during negotiating time when the County was boasting a 30 MILLION dollar surplus?

Again, I am not saying an employee is forced to stay for less than market pay. I am saying that if the County had played fair, they would not have to explain what is now being viewed as a “gift”. They could have simply held that money and said, “we have money for job classes X,Y,Z to have a wage adjustment because we haven’t been able to hire new staff, and the potential candidates cite ‘low salary’ as reason for not accepting the position”. They did not choose to do that.


A funny story by Baseball Hall of Fame Member Ralph Kiner. While playing for the Pittsburgh Pirates in the late 1950s, Kiner had a tremendous season achieving success at the top of the league in many areas. He went to the General Manager, Branch Rickey after the season and asked for an increase and rightfully noted his many superior accomplishments both that year and in seasons past. Mr. Rickey asked a simple question. “Ralph, where did we finish last year?” Kiner replied that the team finished in last place to which Rickey responded. “We could have finished last without you?”


Profits are what allow a business to expand, grow, and hire more employees.


ever read the preamble ?


Why I mention of slaves being raped, sold, traded, etc?

Mike Byrd

I’m married to a public employee and even once was one (sort of) for a few years a long time ago. I have many friends who work in the public sector. I greatly admire the work they do in an environment that isn’t always appreciated by the general public.

That said, the unnegotiated, arbitrary cash payout to county employees was a clear gift of public funds. It would have been very interesting to have been a fly on the wall when that scheme was cooked up. Might it have been done to solicit public union support for one or more supervisors seeking reelection?

As for the surplus, was it really ever there? Or was it just made to look that way in order to make the employee gift more palatable? Of course I have no idea what really goes on behind closed doors at the top of the county building. But it is kind of sad that distrust of the motives of some of our politicians has risen to the point where such speculation seems logical.


Wait …A $30 mil surplus minus the almost $9 mil ‘unforeseen expenses’ still equals $21 mil surplus.

Where did that go ? And, if it’s still there, what’s the problem ? Government should never be hoarding monies.


There was no surplus!

Don’t you wonder how no one had the foresight to “see” the impact (including bennies) that wage adjustment was going to have? If these bean counters worked in the private sector they’d be long gone.

No one this far off the mark survives.


From + $30 million (who believed that?) to almost -$9 million (welcome to reality) in less than 6 months.

Whoever calculated, or miscalculated this budget should be terminated…each and every one of them.


HA HA HA What a bunch of Maroooons. You voted them in

JB Bronson

Is there any County in the State of California that boasts such incompetence?

I want to know. What County would put up with Adam Hill and Bruce Gibson?

The ineptness at City Government levels throughout the County is rampant.

Way too much corruption going on.



Yes, most of them boast such incompetence. Imagine how bad it is in all of counties that have been operating with budget shortfalls for years if not decades.


$30 million surplus…horseshoes and hand grenades.

As long as it’s close, we’re good, right?

Nice job, Caren Ray, Bruce Gibson, Adam Hill, and Frank Mecham, well done!

mb business owner

This is the same story that the residents of morro bay will be getting on Wednesday night. with two new department head positions – community development and an assistant city manager, the city is top heavy. the city manager has also slated the recreation department for sure demise, asking for an increase in program fees to children at about 25%. that coupled with the news that the recreation director won’t be rehired, oh well, who needs children’s program anyway.


I hate to say it, but, we have gotten exactly what we deserve in Morro Bay. There were plenty of challenges in the city before the election of Irons and Company, but, the city leadership understood the business atmosphere, had long contributed many hours of personal time through civil and charitable organizations and worked together for the good of the town. The masses decided it was time to get rid of the “Good Old Boys” and that sentiment was posted on this site on a daily basis. The do nothing, know nothing group got what they wanted. Those of us that did not turn out to vote or help the efforts of the people that know how to get things done are paying the price.

Rich in MB

Is anyone surprised?

Folks…this is a joke there was NEVER a surplus to start with and now after the pay increases we are in a hole!

Jorge Estrada

A good example is the Board mentioning a $182 million in deferred maintainence. Even if it were only a $100 million, that is benifit we paid for that fony books can’t fix. How can there ever be a surplus if public works is under funded and can’t do there job?

Rich in MB

Pitchforks, Tar, and Feathers.

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