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Board amends and approves $46.1 million Department of Public Health supplemental to cover current-year shortfall
Summary
The Budget & Finance Committee approved, as amended, a supplemental appropriation package to address the Department of Public Health's revised $31.2 million general fund deficit and related expenditure authority; the committee incorporated recommendations from the budget analyst to trim $1.22 million.
The Budget & Finance Committee approved a supplemental appropriation for the Department of Public Health (DPH) on April 3 after hearing a detailed presentation from DPH finance staff and recommendations from the Board's budget analyst.
DPH request and drivers: Greg Wagner, chief financial officer for DPH, said the department faces a revised general fund deficit projection of $31.2 million for the current fiscal year and requested appropriations and reappropriations totaling about $46.1 million. Wagner listed primary drivers: a $16.2 million expected retroactive enhanced mental-health reimbursement that has been delayed (one-time), about $19 million of recurring revenue weakness tied to the transition of seniors and persons with disabilities to managed care, and longstanding structural spending above budget primarily in salaries and fringe.
Budget analyst recommendations and amendment: Budget Analyst Mr. Rose recommended trimming the ordinance by $1.222 million (reducing specific expenditure lines and the requested general fund reserve draw) after reviewing actual expenditures and near‑term projections. The committee adopted those analyst amendments and moved the ordinance forward.
Public comment and operational risk: Hospital staff and union representatives told the committee the supplemental is needed to avoid staffing shortfalls that could affect patient care during an intensive operational transition to Affordable Care Act-related requirements. Gus Feldman (SEIU Local 1021) said hiring freezes and unfilled posts risked patient and staff safety; nurses and service workers described heavy workloads and the potential to miss federal performance standards tied to future reimbursements.
What the committee did: The committee voted to accept the budget analyst's recommendations, amend the ordinance accordingly, and move the item forward as amended; supervisors indicated approval was recorded without opposition.
Follow-up and context: Wagner and the budget analyst noted there are possible positive offsets that could reduce the general fund draw if Medi-Cal prior-year audits or a federal/state IGT (intergovernmental transfer) mechanism release funds before year-end; timing is uncertain, and DPH will report back if those revenues materialize. Wagner also said the department is preparing a multiyear plan to address the roughly $45 million structural mismatch that carries into subsequent budgets.
Next steps: The amended appropriation will be placed on the Board of Supervisors agenda for final action and DPH will return with additional budget planning details during the two-year budget process.
