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Yolo County outlines plan to close near‑$40 million budget gap; proposes reductions, one‑time funding and reserve use
Summary
County staff presented a draft plan April 29 to close an approximately $40 million structural budget gap for FY 2025‑26 using departmental reductions (~$13M), one‑time funds (~$16.6M), and reserves (almost $4M), and signaled further work and potential use of additional reserves ahead of the June 10 budget hearing.
Yolo County officials told the Board of Supervisors on April 29 that they have nearly closed a roughly $40 million structural budget gap for fiscal year 2025‑26 but still require final board direction to adopt a balanced budget at the June 10 hearing.
Chief Financial Officer Tom Haines and Chief Budget Official Laura Liddicott presented a two‑pronged approach: (1) prepare a legally balanced recommended budget for the June 10 hearing using a combination of departmental reductions, one‑time funding, and limited reserve draws; (2) develop a longer‑term strategic process to address the county’s structural deficit over multiple years.
Staff’s draft balancing scenario included about $13 million in departmental reductions (salary savings, elimination or unfunding of vacant positions, reduced extra‑help and other cuts), $16.6 million in one‑time funding sources, and use of nearly $4 million in smaller reserves. The proposal also incorporated a $2 million repurposing of ARP funds that the board approved earlier in the meeting and projected savings from a lowered OPEB rate and a pause on supplemental pension contributions. Staff highlighted that the General Reserve would not be used and currently stands at about 8.5 percent of the board’s 10 percent policy goal (approximately $25.4 million).
Staff singled out several notable reductions in draft form, including proposed changes to agricultural department programs, reductions to fire sustainability funding related to districts that have opted out, and proposed unfunding/elimination of certain vacant positions countywide. Staff said those proposed reductions were largely developed in collaboration with departments and remain draft recommendations; further refinement and conversation will continue.
Health and Human Services Agency (HHSA) leadership presented a separate five‑year forecast showing structural deficits in multiple 1991 realignment streams, MHSA and intergovernmental transfers (IGTs). HHSA said it had used vacancy savings and intergovernmental transfers to balance the short term outlook but that those approaches are not sustainable for the long term. HHSA identified candidate administrative reductions and contract changes and said it would return with a plan to close a MHSA shortfall of roughly $4.7 million.
Board members emphasized preserving public‑safety services and avoiding cuts that would meaningfully impair emergency operations. Supervisors also asked for clearer metrics and a timeline for the longer‑term strategic process; staff said they would return with further analysis, department‑head working groups, and a July workshop as the budget process proceeds to the September adoption deadline.
The county is preparing a recommended budget for release ahead of the June 10 public hearing; staff said additional adjustments are likely over the coming weeks and that any specific contract or program changes affecting community‑based organizations would be returned to the board for action.
