Ventura County adopts recommended budget; medical system warns of cash‑flow risk tied to supplemental funding

The Ventura County Board of Supervisors received and filed the recommended fiscal-year 2025–26 budget June 3 and approved staff recommendations that included a plan for a portion of an expected residual fund balance.

County Chief Financial Officer Scott Powers and Budget Director Brian Friedman told the board the county expects to end fiscal 2024–25 with a projected residual general‑fund balance of $35 million to $50 million (about 2.0%–2.8% of adjusted appropriations). Friedman said staff recommend allocating $12.5 million to unassigned “rainy day” reserves, $10 million toward deferred‑maintenance capital renewal, $10 million toward Family Justice Center needs and the remainder toward program mitigation and one‑time priorities.

"Between $10 and $20 million of that is salary and benefit savings," Budget Director Brian Friedman said of the projected residual. "We also have approximately $10 million additional in interest earnings… as well as $10 million or so in additional property tax primarily in the redevelopment agency property tax components."

Board members asked staff to emphasize that the projected balance is one‑time money and should not fund ongoing operating costs.

The board also received an extended presentation from Ventura County Medical System (VCMS) officials, who urged caution about the system’s operational position despite recent increases in supplemental state and federal funding. Teresa Cho, director of the county Health Care Agency, and VCMS CFO Mike Taylor described revenue gains driven largely by supplemental programs — quality‑incentive and other state pools — that are recognized on an accrual basis but paid 12–24 months after the performance period.

"We'd much rather that more of that funding comes through our claims‑based reimbursement on a weekly basis," Taylor told the board. He said supplemental funding has grown to represent roughly 38% of VCMS projected revenues and that the timing of reimbursement creates a significant cash‑flow burden. Taylor said the system’s general‑fund advance balance was projected near $283 million but could decline as outstanding payor reconciliations are resolved.

Scott Powers and other county officials also briefed the board on the uncertain state and federal budget outlook, noting proposed changes to Medi‑Cal eligibility, premiums and other programs that could materially affect county revenues and health‑care workloads. Staff told the board they plan close monitoring and repeated updates as state and federal actions become clearer.

The board approved the CEO’s recommended actions on the budget package by unanimous roll call vote (Supervisors LaVere, Gorrell, Long, Lopez and Chair Parvin). Staff said they will return with more detailed impact analysis when final state and federal budgets are adopted.

Why it matters: The annual recommended budget sets county spending priorities and reserves. VCMS — a major general‑fund cost driver — reported a narrowing gap between operating revenues and expenditures despite supplemental program increases, and warned that the timing of supplemental reimbursements and potential state/federal cuts present cash‑flow and program‑stability risks for the county.