Solano County adopts $1.7 billion budget that relies on reserves as officials brace for federal HR1 impacts

The Solano County Board of Supervisors voted 4–0 on June 25 to adopt the county’s recommended fiscal year 2026–27 budget, a $1.7 billion plan officials said is balanced only with one‑time carryforward funds and scheduled draws from reserves.

Ian Goldberg, County Administrator, opened the hearing and said staff had prepared the proposal after a year‑long budget development process that included a transition to a new county budget software platform. "The budget is balanced, although it does rely on the one time carry forward fund balance, as well as draws from reserves," Goldberg said.

Tammy Lukens, County Budget Officer, told the board the total governmental funds budget is $1,700,000,000, a 2.4% increase over the adopted 2025–26 budget, driven primarily by negotiated salary and benefit increases and rebudgeted capital projects. "The recommended budget before you this morning is $1,700,000,000 for the total governmental funds," Lukens said. She cited $27,500,000 in added salary and benefits and about $19,400,000 in capital rebudgets as the largest drivers.

Lukens said the budget assumes net reductions in allocated positions largely by deleting vacant roles and recommends a net reduction of roughly 18.5–19 FTEs; the County General Fund totals $427,000,000. She also reported a proposed draw of $1,300,000 from the capital renewal reserve, which would reduce that reserve to about $12,500,000 — the lowest level Lukens said the county has seen in around a decade.

The budget relies heavily on intergovernmental revenues, Lukens said, and the county’s fiscal picture is sensitive to property tax appeals. She reported an assessed roll of nearly $78,000,000,000 as of July 2025 and said about 1,300 active appeals represent roughly $8,800,000,000 in assessed value at risk; the largest appellants listed were Genentech, Flannery, Lonza, Solano Town Center and Tesla.

Assistant County Administrator Debbie Vaughn framed the budget discussion around HR1, the federal policy establishing new work and engagement requirements that counties must implement for some CalFresh and Medi‑Cal recipients. Vaughn said CalFresh changes already in effect put an initial estimate of about 5,780 households at risk of losing benefits and that initial county administrative costs tied to CalFresh implementation are about $1,800,000. She added the county’s administrative cost share is expected to increase from roughly 15% to 22%, representing about $2,000,000 more this year. "So we are up to $3,800,000 in new expenses, as of today already related to HR1," Vaughn said.

On Medi‑Cal, Vaughn said similar 80‑hour per month work or engagement rules are expected to take effect January 2027 and that county staff estimate approximately 27,000 individuals in Solano County could be affected. "This has never been a thing before. The systems are not in place to do this," she said, adding county clinics could face $3,200,000 to about $5,300,000 in new costs if they serve roughly 30% of those who lose coverage. Vaughn also estimated countywide Medi‑Cal side impacts might reach about $14,000,000.

Board members pressed staff on where service shortfalls would fall. Supervisor Mashburn warned that COVID one‑time funding had propped up clinics in recent budgets and said a continued $5,000,000 shortfall would force difficult choices. "If that happens and occurs, is there the capacity within the existing system if our clinics aren't there for those folks to have healthcare?" Mashburn asked. Vaughn and Lukens replied they are evaluating capacity, negotiating clinic rates with the state and coordinating with Federally Qualified Health Centers and other partners, but they could not yet provide firm answers on full financial impact.

Public commenters addressed the budget and HR1’s consequences. A resident who identified herself as Amy urged transparency and audits, criticized what she called wasteful spending and asked why the county does not prioritize desalination for clean water. Caitlin Sly of the Food Bank of Contra Costa and Solano thanked county staff for partnership on HR1 outreach and said the food bank will help screen for exemptions and record volunteer hours. Max Pare of Aliados Health, representing a consortium of federally qualified health centers including La Clinica de la Raza and CommuniCare, offered partnerships to assist residents who will be affected by the new requirements.

Supervisor Mashburn moved to adopt the recommended budget resolutions and associated actions (1–25); the motion was seconded and approved by a 4–0 roll‑call vote. The board closed the public hearing and adjourned; Chair Brown said the next meeting is scheduled for July 28 at 09:00.

The adopted package delegates authority to staff to facilitate fiscal year 2025–26 closeout and lists specific position allocation and capital project approvals; the board and staff said they will return with additional information as HR1 regulations and state implementation guidance become clearer.