Shasta County OKs temporary $7M loan increase for Social Services; board asks for plan to cut $1M/month

The Shasta County Board of Supervisors voted 4–0 on Sept. 9 to increase the Social Services Fund’s allowable negative cash balance from $5 million to $7 million while the department awaits incoming state reimbursements and realignment corrections.

Erin Watts, HHSA branch director for administration, told the board the agency has experienced timing and revenue issues: steady caseload growth, a state reconciliation that required shifting roughly $2.1 million from Social Services to Mental Health, and delayed reimbursement claims. Watts said the county is pursuing short‑ and long‑term measures including reducing discretionary programs, consolidating leases and pausing hiring for some senior roles.

Supervisors pressed for a clearer financial path. Supervisor Matt Plummer asked what receivables the county expects and whether the loan could be repaid by Oct. 31; Watts said the state claims process historically delivers substantial deposits in September/October but she was not fully confident the $7 million hole would be closed by that date. Plummer moved approval of the loan increase and asked staff to return by Oct. 31 with a preliminary plan to cut about $1 million per month from the Social Services budget, a motion the board approved.

Supervisor Long and other board members emphasized that the problem combines timing of reimbursements and structural funding shortfalls tied to realignment revenues that haven’t kept pace with service costs. County officials said general‑fund cash availability is currently adequate for the loan but stressed the need for a midyear review and more detailed accrual accounting. Watts and finance staff said they would provide updated claims information and a more detailed plan at the next board meeting.

The increase is an interim cash‑flow measure; the board required staff to return with a cost‑reduction and repayment plan.