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HomeMy WebLinkAboutCounty of Santa Barbara - Public Financial ReportFinancial Highlights Fiscal Year Ended June 30, 2021 Santa Barbara County, CA Betsy M. Schaffer, CPA, CPFO Auditor-Controller C. Edwin Price, Jr., CPA, CPFO Assistant Auditor-Controller COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021i This Financial Highlights publication is intended to provide the general public with an easy-to-read overview of Santa Barbara County’s (County) financial condition. The information contained in this report is derived from the County’s Annual Comprehensive Financial Report (ACFR) which is more detailed in nature and in conformance with generally accepted accounting principles (GAAP) in the United States of America. This report provides highlights of the significant financial and economic activity of the County for the fiscal year ended June 30, 2021. Copies of the ACFR can be obtained by contacting the Auditor-Controller’s office, or can be found on the Auditor-Controller’s website at www.countyofsb.org/auditor. FINANCIAL Awards and Acknowledgments 1 Statement of Net Position 8Statement of Activities 9Capital Assets 10Debt 11 Governmental Funds 12General Fund 13Economy at a Glance 14 Major Initiatives 16Whistleblower Hotline 17Glossary 17 COUNTY OVERVIEW OTHER INFORMATION BUDGET & ECONOMY TABLE OF CONTENTS COUNTY OF SANTA BARBARA FINANCIAL HIGHLIGHTS INTRODUCTION Who We Are 2County at a Glance 4County Services at a Glance 5County Timeline 6County Outlook 7 While the financial statements’ data presented within the County’s Financial Highlights conform to Generally Accepted Accounting Principles (GAAP), some statistics are taken from various sources and are not GAAP-based data. ' COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/1 SANTA BARBARA COUNTY, CA AWARDS AND ACKNOWLEDGMENTS Government Finance Officers Association Award for Outstanding Achievement in Popular Annual Financial Reporting Presented to the County of Santa Barbara California For its Annual Financial Report for the Fiscal Year Ended 2020 Executive Director/CEO Santa Barbara County is a wonderful place, filled with beauty and grace. The theme for the fiscal year (FY) 2020-21 Financial Highlights is “the wonders of Santa Barbara County.” The theme of wonder came during the COVID-19 pandemic. That in the midst of fear, illness, mortality, masks, social distancing, and social change, the natural beauty of Santa Barbara County has remained a wonder, and wonderful. From the Guadalupe Dunes to the March 2021 snowstorm in downtown Santa Barbara, our spirit is fed through our eyes. The photos placed throughout the Financial Highlights publication displaying snips of this wonder are from across Santa Barbara County. Many acknowledgments to Mike Eliason, Joel Boyer, Suzann Sturz, and Jonathan Rodriguez who provided the photos through their eyes. THEME: INTRODUCTION THE AUDITOR-CONTROLLER MISSION: We ensure the County’s financial integrity and promote efficient, effective, and accountable government. We are very proud of the Financial Highlights and all of the County’s award-winning financial reporting publications. Each publication has been prepared with great care and expertise with the goal of meeting the highest level of financial reporting preparation standards. The preparation of the ACFR and its timely issuance is the result of a concentrated, dedicated, and coordinated effort by the entire Auditor- Controller staff. We would like to acknowledge the special efforts of the Financial Reporting Division for their assistance in the report’s preparation. We would also like to thank all County departments who participated in its preparation. Additionally, the County received the Government Finance Officers Association’s (GFOA) Award for Outstanding Achievement in Popular Annual Financial Reporting for its Financial Highlights publication for the fiscal year ended June 30, 2020. This award has been achieved annually since 1995. To receive this prestigious award, a government must publish a Popular Annual Financial Report that conforms to program standards of creativity, presentation, understandability, and reader appeal. AWARDS AND ACKNOWLEDGMENTS: COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/2 WHO WE ARE COUNTY FUNCTIONAL GROUPS The County’s policymaking and legislative authority is vested in the County Board of Supervisors (Board), which consists of an elected supervisor from each of the five districts. The Board sets policy for County departments, oversees a budget of over $1.0 billion, and adopts ordinances on local matters, as well as land use policies that affect unincorporated areas (areas outside of cities). The Policy and Executive group includes the County Board of Supervisors. The group is responsible for: setting policy, risk management programs, emergency operations, recommending and overseeing the budget, and providing legal services. The departments in this functional group are devoted to enhancing the quality of life in the County. They look to preserve and protect natural resources, foster safe long-term land use, develop affordable housing, support the use of parks, protect agriculture and maintain essential public works facilities to make everyday life as safe and convenient as possible. This functional group provides important general government services to the citizens such as elections, property tax administration, treasury operations, and also provides support services to County operations such as information technology, payroll, and capital projects. These departments provide financial integrity for the County, as well as management of the County’s assets. This group performs functions that are not directly associated with a specific department, such as organizational development. Transfers to other government entities, such as the Human Services Commission, and the Local Agency Formation Commission, are also accounted for in this functional group. COMMUNITY RESOURCES & PUBLIC FACILITIES GENERAL GOVERNMENT & SUPPORT SERVICES GENERAL COUNTY PROGRAMS POLICY & EXECUTIVE Public Safety protects the community, including people and their property via law enforcement, fire protection, custody of adult and juvenile criminals, and probation monitoring of offenders. This function also protects the rights and the safety of citizens through criminal/civil prosecution and defense of the accused. PUBLIC SAFETY FTE: 1,533 +24 from FY 2019-20 Exp: $363.9M +$15.6M FY 2019-20 This functional group strives to improve the health of the community through preventive health services, aiding individuals and families to become emotionally, socially and fiscally self- sufficient, serving children and families by enforcing child support orders, and providing a comprehensive array of alcohol, drug, and mental health services. HEALTH & HUMAN SERVICES FTE: 1,707 +26 from FY 2019-20 Exp: $402.5M +$16.1M FY 2019-20 FTE: 432 + 6 from FY 2019-20 Exp: $159.3M +$37.8M FY 2019-20 FTE: 333 + 3 from FY 2019-20 Exp: $61.8M +$4.5M FY 2019-20 FTE: 105 + 8 from FY 2019-20 Exp: $23.5M +$2.5M FY 2019-20 FTE: 0 + 0 from FY 2019-20 Exp: $9.4M +$6.5M FY 2019-20 COUNTY DISTRICTS COUNTY OVERVIEW COUNTY BOARD OF SUPERVISORS COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/3 COUNTY DEPARTMENTS WHO WE ARE The County departments have dual roles in providing services to their residents. Firstly, basic local government services are provided to residents in the unincorporated areas of the County. These services include fire protection and maintenance of County roads, as well as services in some cities by contract, such as Sheriff patrol. Secondly, countywide services are provided as a regional government, such as District Attorney prosecution and Sheriff jail operations or as agents for the State through public assistance programs. For details about such County services, peruse the County’s Recommended Budget publication available online at www.countyofsb.org/ceo. The County has five elected department directors responsible for the offices of the Auditor-Controller, Clerk-Recorder-Assessor, District Attorney, Sheriff-Coroner, and Treasurer-Tax Collector-Public Administrator. The above organization chart reflects the various functional groups reported in the ACFR, along with the names of the principal officials. COUNTY OVERVIEW Board of Supervisors Mona Miyasato County Executive Officer Policy Rachel Van Mullem County Counsel Pam Fisher, PsyD (Interim) Behavioral Wellness Joni Maiden Child Support Services g,. Executive Van Do-Reynoso, MPH, PhD Public Health Services Daniel Nielson Social Services Marl< Hartwig Fire William F. Brown Sheriff-Coroner TanJa Heitman Probation Darrel E. Parker Court SP-ecial Services Tracy M. Macuga Public Defender COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/4 DEMOGRAPHICS COUNTY AT A GLANCE Sonoma, $95.84 Billion Santa Barbara, $88.07 Billion Marin, $82.16 Billion Placer, $80.03 Billion Monterey, $72.17 Billion Solano, $60.49 Billion San Luis Obispo, $59.54 Billion Santa Cruz, $50.89 Billion Tulare, $36.80 Billion 2012 135,145 2012 100,504 2012 89,474 201242,981 2012 29,928 2012 13,052 2012 7,102 2012 5,284 20124,867 2021 133,351 2021 107,445 2021 93,055 2021 42,493 2021 32,339 2021 13,196 20218,346 2021 5,512 2021 5,435 0 50,000 100,000 150,000 Unincorporated Santa Maria Santa Barbara Lompoc Goleta Carpinteria Guadalupe Solvang Buellton Santa Barbara County offers idyllic settings for residents and visitors. Located approximately 100 miles northwest of Los Angeles and bordered by the Pacific Ocean to the west and south, it is known for its mild climate, picturesque coastline, vineyards, abundant agriculture, scenic mountains, and numerous parks and beaches – including the richly biodiverse marine habitat of the Channel Islands. Founded: February 18, 1850 Total population: 441,172 Area: 2,735 square miles Incorporated cities: 8 SANTA BARBARA COUNTY FY 2019-20 PROPERTY TAX ROLL VALUES OF COMPARABLE COUNTIES POPULATION CHANGES* (2012 VS 2021) AVERAGE EDUCATION LEVELS (2015 - 2019) QUICK FACTS COUNTY OVERVIEW High School Graduates Bachelor's Degree or Higher Non-high School Graduates Santa Barbara County 34.20% Santa Barbara County 19.10% Santa Barbara County 46.70%CA 33.90% CA 16.70% CA 49.40% *Provided by The State of California Department of Finance 1111 San Luis Obispo County Santa Maria Area: 22. 76 Sq Miles Buellton Area: 1.58 Sq Miles Lompoc Area: 11.60 Sq Miles Goleta Unincorporated Santa Barbara County Area: 2,675.36 Sq Miles Solvang Area: 2.43 Sq Miles Area: 7.90 Sq Miles Santa Barbara Area: 19.47 Sq Miles Carpinteria Area: 2.59 sq MIies I I 1 1 ---- ~ C ::I 0 u C ... ::! ~ C ::I 0 u 111 ... ::I .... C GI > COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/5 ASSETS AND OPERATIONS COUNTY SERVICES AT A GLANCE CAPITAL ASSETS AND INFRASTRUCTURE STATISTICS BY FUNCTION/PROGRAM OPERATING INDICATORS BY FUNCTION/PROGRAM COUNTY OVERVIEW FY 2019-20 FY 2020-21 Function/Program Public Safety Other: Filed felonies-District Attorney 2,582 -401 2,181 Filed misdemeanors- District Attorney 8,935 -2,401 6,534 Public Defender's total new caseload 12,247 -4,375 7,872 Fire emergency responses 14,723 -105 14,618 Sheriff: Total miles patrolled 1,406,295 -43,405 1,362,890 Processed and booked adult offenders 11,108 -2,782 8,326 Probation: Juvenile referrals processed 1,987 -1,265 722 Adult and Juvenile cases supervised 7,318 -2,517 4,801 Institutional care for minors 16,344 -9,424 6,920 Submit written reports to courts on Adults 3,911 -1,373 2,538 Health & Human Services Behavioral Wellness clients served 14,052 -3,400 10,652 Established orders for child support 10,964 -506 10,458 Assistance claims paid to eligible recipients 85,710 -5,901 79,809 Patient encounters at Public Health clinics 113,500 7,500 121,000 Community Resources & Public Facilities Building inspections 24,952 -9 24,943 Enhanced or maintained road lanes (miles)64 -18 46 Flood control work requests -- -- -- General Government & Support Services Clerk-Recorder-Assessor: Recorded documents & vital copies issued 104,052 36,519 140,571 Resource Recovery Waste recycled (tons per month)7,882 371 8,253 Landfill waste disposal (tons per month)17,744 -1,499 16,245 FY 2019-20 FY 2020-21 Function/Program Public Safety Court buildings 7 -- 7 Other buildings 5 -- 5 Fire stations 16 -- 16 Fire trucks 45 -- 45 Ambulances 6 -- 6 Sheriff sub stations 4 -- 4 Patrol units 63 -2 61 Aircrafts 6 1 7 Jail and detention facilities 6 -- 6 Administration buildings 10 -- 10 Health & Human Services Clinics 12 -- 12 Administration buildings 3 -- 3 Community Resources & Public Facilities Public parks & open space acreage 2,122 38 2,160 Day use & camping parks 26 -- 26 Open space areas (County developed)45 -- 45 Outdoor events center 1 -- 1 Veterans buildings 3 -- 3 Seawalls 2 -- 2 Road lane miles 1,650 -- 1,650 Bridges 120 -- 120 Traffic signals 43 -- 43 Roads heavy equipment 49 -- 49 Sanitary sewers (miles of collection)129 -- 129 Treatment capacity (million gallons per day)4 -- 4 Resource Recovery heavy equipment 77 7 84 General Government & Support Services Buildings 7 -- 7 COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/6 FY 2020-21 COUNTY TIMELINE The State economy came to an abrupt halt in the spring of 2020 due to the COVID-19 pandemic. According to the California Fiscal Outlook, the State began to experience an economic recuperation faster than anticipated during FY 2020-21; however, this recovery has been asymmet-ric leaving many low-income individuals unemployed while most high-income employment remains intact. The State’s unemployment rate reached heights not seen since the Great Depression, cresting at 16% in the spring of 2020 before dropping to a FY 2020-21 average of 7%. In October 2020, spending had risen to within approxi-mately 10% of pre-pandemic levels and by June 2021 re-tail sales rebounded to show a 13% increase from the prior year. To ease the issues related to unemployment peaking due to COVID-19, California signed into law the SB-74 Budget Act in late June of 2020. This Act was intended to address the predicted funding shortfalls estimated by the Legisla-tive Analyst’s Office and the Department of Finance and to supplement Federal Government stimulus packages aimed at providing monetary relief to business owners to keep employees on their payroll, providing multiple stimulus payments to taxpayers, extending unemploy-ment benefits to the unemployed, and offering tenant relief for rental payments. The SB-74 Budget Act expected that the State would face an unprecedented decline in personal, corporate, and JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN 09 02 06 10 26 05 23 03 15 08 Santa Barbara COVID Hospitalizations Reach All Time High – Santa Barbara Independent Santa Barbara County Cannabis Tax Revenue Doubles During Pandemic – Santa Barbara Independent Santa Barbara County to Stay in COVID-19 Red Tier – Noozhawk County to Set Up Temporary Emergency Shelter for People Living in Isla Vista Encampments – Noozhawk First Phase Finished as Part of Conservation Project at Santa Barbara County Courthouse – Noozhawk Santa Barbara County Has Highest COVID-19 Spread in California – Edhat Schools to Open in Santa Barbara County – Santa Barbara Independent Santa Barbara County Expects $5 Million Budget Surplus for Current Fiscal Year – Edhat Vandenberg Space Force Base a Major Economic Boon in Two Counties, Study Shows – Noozhawk Santa Barbara Hotels Rebounding from Pandemic Lows to Reach Record Highs – KEYT HEADLINES ECONOMIC CONDITION COUNTY OVERVIEW • • • • • • • • • • COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/7 ECONOMIC CONDITION (CONT.) COUNTY OUTLOOK 0 1 2 3 4 5 6 7 8 9 10 0 1 2 3 4 5 6 7 8 9 10 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Ge n e r a l F u n d A s s e s s e d V a l u e G r o w t h (i n b i l l i o n s ) Pr o p e r t y T r a n s f e r & S u p p l e m e n t a l T a x e s (i n m i l l i o n s ) Fiscal Year Ending June 30 PTT Supp Tax AV Growth Fiscal Year 2020-21 2019-20 Change PCT % Change Revenue State $ 341.9 $ 251.1 $ 90.8 36.2% Federal 137.8 113.7 24.1 21.2% Other 6.8 4.6 2.2 47.8% Total Revenue $ 486.5 $ 369.4 $ 117.4 sales tax revenues for FY 2020-21. However, State tax revenues have been better than expected due to the relatively stable economic status of high-income earn- ers and the rebound in stock market investments. As such, State and Federal revenue increased by $90.8 million and $24.1 million, a 36.2% and 21.2% increase over the prior year, respectively (see table to right). Ad- ditionally, the anticipated increased use of safety-net programs, such as Medi-Cal and CalFresh, did not ac- tualize. Leisure/Hospitality and Retail industries struggled through much of 2020 and early 2021 but have begun to show signs of recovery with moderate increases in the latter half of fiscal year 2021. Furthermore, the real estate market continued on an upward trend evidenced by large increases in Property Transfer Taxes (see graph to right); simultaneously, inventories dropped and local realtors reported multiple offers on properties as the pandemic continued. In addition to real estate increas- es, the County continued to see trending increases in Cannabis Tax Revenue along with recovering Transient Occupancy Tax and Sales Tax Revenue (see graphs be- low). The hardships created by the pandemic have been ev- ident; however, based on trends a recovery appears to be underway. COUNTY OVERVIEW Property, $232,276 , 84% Cannabis, $15,747 , 6% Transient Occupancy, $12,535 , 5% Sales, $14,801 , 5% Other, $43,083 , 16% Property Cannabis Transient Occupancy Sales $14,801 $13,175 $12,582 $11,947 $12,165 $12,535 $10,182 $10,320 $8,364 $10,068 $15,747 $12,182 $6,761 $- $5,000 $10,000 $15,000 $20,000 $25,000 $30,000 $35,000 $40,000 $45,000 2021 2020 2019 2018 2017 FY 2020-21 GENERAL TAX REVENUE AND TRENDS (IN THOUSANDS) INTERGOVERNMENTAL TAX REVENUE (IN MILLIONS) COUNTY GENERAL FUND ASSESSED VALUE (AV) GROWTH VS. PROPERTY TRANSFER TAX (PTT) & SUPPLEMENTAL TAXES (SUPP TAX) Property, $232,276 , 84% Cannabis, $15,747 , 6%Transient Occupancy, $12,535 , 5%Sales, $14,801 , 5% Other, $43,083 , 16% Property Cannabis Transient Occupancy Sales□ ■ □ □ COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/8 STATEMENT OF NET POSITION (IN MILLIONS)* The Statement of Net Position presents the County’s financial position from a long-term perspective. It reports all of the County’s assets, deferred outflows of resources, liabilities, deferred inflows of resources, and net position. Over time, increases or decreases in net position may serve as a useful indicator of how the County’s financial position is trending. Governmental Business-Type Activities Activities Total Fiscal Year 2018-19 2019-20 2020-21 2018-19 2019-20 2020-21 2018-19 2019-20 2020-21 Assets Current and other assets $ 625.1 $ 675.3 $ 827.0 $ 213.1 $ 177.8 $ 169.9 $ 838.2 $ 853.1 $ 996.9 Capital assets, net of depreciation 806.6 820.4 843.6 141.0 202.1 252.2 947.6 1,022.5 1,095.8 Total assets 1,431.7 1,495.7 1,670.6 354.1 379.9 422.1 1,785.8 1,875.6 2,092.7 Deferred outflows of resources 260.7 205.5 345.9 5.0 3.9 6.2 265.7 209.4 352.1 Liabilities Current and other liabilities 102.0 113.1 152.9 8.1 17.0 19.6 110.1 130.1 172.5 Long-term liabilities 998.2 969.0 1,152.4 221.8 219.5 248.1 1,220.0 1,188.5 1,400.5 Total liabilities 1,100.2 1,082.1 1,305.3 229.9 236.5 267.7 1,330.1 1,318.6 1,573.0 Deferred inflows of resources 88.3 84.5 68.9 0.9 0.9 0.7 89.2 85.4 69.6 Net investment in capital assets 736.3 755.5 782.4 82.7 88.7 98.6 819.0 844.2 881.0 Restricted 302.3 316.8 364.8 -- -- -- 302.3 316.8 364.8 Unrestricted -534.7 -537.7 -504.9 45.6 57.7 61.3 -489.1 -480.0 -443.6 Total net position $ 503.9 $ 534.6 $ 642.3 $ 128.3 $ 146.4 $ 159.9 $ 632.2 $ 681.0 $ 802.2 Net position Net Position Components The largest component of the County’s net position is net investment in capital assets. It cannot be used to liquidate the County’s debt. The second largest component is restricted net position. These resources are subject to external restrictions on how they may be used, for example, restrictions imposed by grantors, contributors, laws or regulations of other governments, or restrictions imposed by law through constitutional provision or legislation, including those passed by the County itself. The final component of net position is unrestricted net position. It is a resource that can be used to meet ongoing obligations to citizens and creditors. FINANCIAL *Amounts may differ from the ACFR due to rounding. COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/9 STATEMENT OF ACTIVITIES (IN MILLIONS)* The Statement of Activities reports the County’s revenues and expenses during the fiscal year, as well as any transactions that increase or decrease its net position. Revenues are classified by source and expenses are classified by function. Transfers are an allocation of monies from one area of the government to another. Governmental Business-Type Activities Activities Total Fiscal Year 2018-19 2019-20 2020-21 2018-19 2019-20 2020-21 2018-19 2019-20 2020-21 $ 648.0 $ 635.0 $ 734.6 $ 47.6 $ 57.6 $ 55.7 $ 695.6 $ 692.6 $ 790.3 336.6 360.2 380.0 2.4 2.2 0.4 339.0 362.4 380.4 Total revenues 984.6 995.2 1,114.6 50.0 59.8 56.1 1,034.6 1,055.0 1,170.7 17.9 19.1 19.7 -- -- -- 17.9 19.1 19.7 341.9 376.1 389.2 -- -- -- 341.9 376.1 389.2 361.5 397.0 412.1 -- -- -- 361.5 397.0 412.1 119.7 122.4 147.7 -- -- -- 119.7 122.4 147.7 38.0 46.3 49.0 -- -- -- 38.0 46.3 49.0 1.0 1.8 9.5 -- -- -- 1.0 1.8 9.5 1.9 1.8 1.6 -- -- -- 1.9 1.8 1.6 -- -- -- 32.8 34.3 34.0 32.8 34.3 34.0 -- -- -- 7.2 7.4 8.7 7.2 7.4 8.7 Total expenses 881.9 964.5 1,028.8 40.0 41.7 42.7 921.9 1,006.2 1,071.5 0.1 0.0 -0.1 -0.1 -0.0 0.1 -- -- -- Change in net position 102.8 30.7 85.7 9.9 18.1 13.5 112.7 48.8 99.2 Net position - beginning 400.6 503.9 534.6 118.4 128.3 146.4 519.0 632.2 681.0 Prior period adjustment 0.5 -- 22.0 -- -- -- 0.5 -- 22.0 Net position - beginning, as restated 401.1 503.9 556.6 118.4 128.3 146.4 519.5 632.2 703.0Net position - ending $ 503.9 $ 534.6 $ 642.3 $ 128.3 $ 146.4 $ 159.9 $ 632.2 $ 681.0 $ 802.2 Interest on long-term debt Resource Recovery Health & Human Services Transfers In -Out Community Resources & Public Facilities Laguna Sanitation General Government & Support Services General County Programs Public Safety Expenses Policy & Executive General Revenues Revenues Program Revenues FINANCIAL *Amounts may differ from the ACFR due to rounding. COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/10 (IN THOUSANDS) CAPITAL ASSETS A significant portion of the County’s assets are capital assets which include land, land improvements, structures and improvements (e.g., office buildings and building improvements), equipment (e.g., vehicles, machinery and computers), infrastructure (e.g., roads, bridges, sidewalks, and similar items), and intangible assets (e.g., land easements and computer software). Capital assets under construction at the end of the fiscal year are reported as work in progress (WIP). *Other represents individual projects that have total completed WIP balances under $600. $728 $163 $4,113 $1,283 $812 $737 $726 $644 $2,919 $888 $553 $4,485 $1,469 $1,309 $608 $2,805 $0 $500 $1,000 $1,500 $2,000 $2,500 $3,000 $3,500 $4,000 $4,500 Lookout Park Renovation Other* Interchange Improvements East Mountain Rd. Bridge Baron Ranch Trail Extension Barrier Fence on Union Valley Pkwy Eastside Storm Drain Reconstruction Tajiguas Landfill Main Access Rd Other* Sheriff In-Car Video System Other* Laguna Sanitation Sludge Beds Laguna Sanitation Flood Protection Arroyo Burro Ranger Station Upgrades Laguna Sanitation Plant Upgrades Other* Significant Capital Projects Completed from WIP Structures and Improvements Equipment and Software Infrastructure LandImprovements $99,127 $107,299 $62,530 $4,272 $4,748 $13,677 $5,128 $21,597 $16,853 $10,263 $0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 Tajiguas ReSource Center Northern Branch Jail*All otherLaguna Sanitation Plant Expansion Randall Road Debris Basin WIP Additions Beginning WIP Balance $112,804$112,427 $84,127 $21,125 $15,011 Two of the largest capital projects in County history are currently undergoing construction and are included in WIP – the Northern Branch Jail and the ReSource Center (formerly known as the Tajiguas Resource Recovery Project ‘TRRP’). The ReSource Center is designed to modify the processing of solid waste currently delivered to the landfill for disposal, as well as process source-separated recyclables and organic waste from public participants (e.g. the County and participating cities). County projects include existing and future recycling programs designed to reduce landfilling and greenhouse gas emissions and to extend the life of the Tajiguas Landfill. FINANCIAL SIGNIFICANT CAPITAL PROJECTS COMPLETED FROM WORK IN PROGRESS WORK IN PROGRESS ADDITIONS COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/11 (IN MILLIONS)* DEBT The County’s debt represents monies borrowed to facilitate the acquisition, installation, and construction of capital projects. The County maintains a Standard & Poor’s ‘SP-1+’ rating for short-term notes (this scale ranges from SP-1, the highest, to D, the lowest) and a Standard & Poor’s ‘AA+’ for long-term certificates of participation (this scale ranges from AAA, the highest, to D, the lowest). In addition, the County maintains a Moody’s ‘A1’ rating (this scale ranges from Aaa1, the highest, to Caa3, the lowest) and an S&P ‘AA+’ rating on its most recent series 2020 Certificates of Participation. The County’s strong credit ratings with Standard & Poor’s and Moody’s results in reduced borrowing costs for new capital asset construction (e.g., the Tajiguas ReSource Center). The rationale behind the ratings reflects the rating agencies’ view of: • The long–term general creditworthiness of the County; • The County’s covenants to budget and appropriate lease payments; • A stable, moderately growing economic base with access to the broader Ventura and Los Angeles area economies; • Maintenance of very strong unreserved General Fund balances despite limited financial flexibility due to State mandates; • An experienced management team that has implemented strong financial policies and prudent expenditure controls; • Low overall debt levels; and • The County’s very strong underlying general credit characteristics. Governmental Business-Type Activities Activities Total Fiscal Year 2018-19 2019-20 2020-21 2018-19 2019-20 2020-21 2018-19 2019-20 2020-21 Bonds and notes payable $ 11.7 $ 8.5 $ 5.9 $ 4.3 $ 3.5 $ 2.7 $ 16.0 $ 12.0 $ 8.6 Certificates of participation 25.9 24.9 23.5 167.0 165.0 191.5 192.9 189.9 215.0 Total $ 37.6 $ 33.4 $ 29.4 $ 171.3 $ 168.5 $ 194.2 $ 208.9 $ 201.9 $ 223.6 -- $20 $40 $60 $80 $100 $120 $140 $160 $180 Enterprise Fund Debt Service Fund Internal Service Fund FINANCIAL LONG-TERM DEBT OBLIGATIONS BY FUND TYPE** *Amounts may differ from the ACFR due to rounding. **Inclusive of certificates of participations, bonds, and notes payable. ***The Debt Service Fund category includes amounts related to the General Fund and special revenue funds. *** COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/12 (IN THOUSANDS) GOVERNMENTAL FUNDS Governmental funds track the inflows and outflows of the County’s resources based on their primary funding source. The General Fund represents most of the County’s discretionary activities that are funded primarily by local property taxes while the other governmental funds are mostly State funded activities that the County performs under its role as an arm of the State government. The bottom line for each fund is the net change in fund balance – sources minus uses. When this amount is positive, a fund will increase its fund balances for use in a future period. $161,851 $120,358 $98,131 $95,463 $75,459 $50,218 $25,794 $26,173 $15,685 $2,187 $14,380 $8,915 $342 $11,424 $1,732 $164,038 $134,738 $107,046 $95,805 $86,883 $41,675 $27,526 $25,002 $12,385 -$8,543 -$1,171 -$3,300 $- $35,000 $70,000 $105,000 $140,000 $175,000 Use Increase to Fund Balance Source Decrease to Fund Balance BUDGET & ECONOMY *General Fund purposely omitted: General Fund Sources $539,666; General Fund Uses $481,163; General Fund Increase to Fund Balance $58,503. FY 2020-21 GOVERNMENTAL FUND USES General; $481,163 ; 42% Social Services; $161,851 ; 14% Behavioral Wellness; $120,358 ; 11% Fire Protection District; $95,463 ; 8% Public Health; $98,131 ; 9% Roads; $50,218 ; 4%Capital Projects; $15,685 ; 1% Flood Control District; $26,173 ; 2% Affordable Housing; $25,794 ; 2% Other Governmental Funds; $75,459 ; 7% FY 2020-21 Governmental Fund Uses Total $1,150,295 GOVERNMENTAL FUNDS SOURCES, USES, AND CHANGES TO FUND BALANCE* When Uses exceed Sources, Fund Balance is drawn to meet the unfunded needs. Conversely, when Sources exceed Uses, the excess is set aside as Fund Balance for use in a future period. Capital Projects Flood Control District Affordable Housing Roads Other Gov Funds Fire Protection Public Health Behavioral Wellness Social Services COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/13 (IN THOUSANDS) GENERAL FUND NONSPENDABLE - not spendable due to form (inventory) or law (endowment). RESTRICTED - can only be spent for specific purposes required by external parties (State grants) or enabling legislation (California Constitution). COMMITTED - can only be used for the purposes determined by the formal action of the County’s Board of Supervisors, increases and decreases to committed fund balances requires varying levels of approval by the County’s Board of Supervisors. UNASSIGNED - can be used for any purpose as this amount represents the residual balance of the General Fund and includes all amounts not contained in the other classifications. The General Fund’s primary revenue sources are property taxes, intergovernmental revenues (primarily State grants), and charges for services (primarily the revenues from fee based services). Taxes; $283,834 ; 53% Intergovernmental; $162,349 ; 30%Charges for services; $65,347 ; 12% Transfers in & Capital Asset Sale Proceeds; $9,527 ; 2% Fines, forfeitures, & penalties; $6,432 ; 1% Other Revenue; $6,233 ; 1% Licenses, permits, & franchises; $4,928 ; 1% Use of money & property; $1,016 ; <1% Other; $28,136; 5% Public Safety; $256,339 ; 53% Transfers Out; $90,306 ; 19% General Government & Support Services; $58,257 ; 12%Health & Human Services; $38,960 ; 8% Policy & Executive; $23,531 ; 5% General County Programs; $9,003 ; 2% Community Resources & Public Facilities; $4,767 ; 1% Other; $37,301 ; 8% BUDGET & ECONOMY FY 2020-21 GENERAL FUND SOURCES FY 2020-21 GENERAL FUND USES Expenditures are reported by function with the current operating expenditures presented apart from debt service and capital expenditures. Other financing sources (uses) include the cash received when bonds are issued, as well as transfers between funds. Apart from the fact that these resource flows are not revenues or expenditures, they are shown separately to assist the reader of the statement in assessing the balance between ongoing revenues and expenditures related to the basic operation of the government. FUND BALANCE COMPONENTS $13,029 $131,484 $55,068 $2,318 $6,810 $50,033 $7,093 -$2,262 $0 $50,000 $100,000 $150,000 $200,000 Unassigned Committed Restricted Nonspendable Beginning Fund Balance Increases Decreases $56$56 $181,517$181,517 $62,161$62,161 $19,839$19,839 $13,029 $131,484 $55,068 $2,318 $6,810 $50,033 $7,093 -$2,262 $19,839 $181,517 $62,161 $56 $0 $50,000 $100,000 $150,000 $200,000 Unassigned Committed Restricted Nonspendable Beginning Fund Balance Increases Decreases Ending Fund Balance COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/14 SANTA BARBARA COUNTY, CA ECONOMY AT A GLANCE The County's average unemployment rate continued to increase due to the impact of COVID-19. EMPLOYER EMPLOYEES 1. County of Santa Barbara 4,307 Industry - Government, Location - Santa Barbara 2. University of California, Santa Barbara 4,250 Industry - Education, Location - Santa Barbara 3. Cottage Health Organization 3,245 Industry - Health, Location - Santa Barbara 4. Vandenberg Air Force Base 2,500 Industry - Defense, Location - Lompoc 5. Santa Maria-Bonita School District 2,010 Industry - Education, Location - Santa Maria 6. Chumash Casino Resort 2,000 Insustry - Recreation/Hospitalitiy, Location - Santa Ynez 7. Mission Linen Supply 2,000 Industry - Textiles/Facility Services, Location - Santa Barbara 8. Marian Regional Medical Center 1,486 Industry - Health, Location - Santa Maria 9. Allan Hancock College 1,400 Industry - Education, Location - Santa Maria 10. Appfolio 1,350 Industry - Software, Location - Goleta TOP 10 EMPLOYERS* JOBS BY INDUSTRY BUDGET & ECONOMY Transportation & Warehousing, 3,385 Information, 3,919 Wholesale Trade, 4,914 Other Services, 5,555 Financial Activities, 6,630 Retail Trade, 17,908 Goods Producing, 21,742 Leisure & Hospitality, 22,134 Farm, 25,182 Educational & Health Services, 28,059 Government, 34,614 Professional & Business Services, 36,599 *Provided by pacbiztimes.com, May 2021. 3.0 4.0 5.0 6.0 7.0 8.0 9.0 2012 2021 Pe r c e n t Fiscal Years Ended June 30 AVERAGE UNEMPLOYMENT RATE: 7%, +0.9% from FY 2019-20 300 350 400 450 500 2012 2021 Mil l i o n s o f D o l l a r s Fiscal Years Ended June 30 HOTEL/MOTEL ROOM SALES: $453M, +$36M from FY 2019-20 The County's room sales increased compared to the last fiscal year showing recovery from the impacts of COVID-19. 48 50 52 54 56 58 60 2011 2020 Th o u s a n d s o f D o l l a r s As of May AVERAGE SALARY: $59.5K, +$2.96K from FY 2019-20 The County's average annual wages continued to increase in calendar year 2020. 6.0 6.5 7.0 7.5 8.0 8.5 2012 2021 Bil l i o n s o f D o l l a r s Fiscal Years Ended June 30 RETAIL SALES: $8.43B, +$0.98B from FY 2019-20 The County experienced an increase in retail sales signaling a recovery from the impacts of COVID-19. MEDIAN HOME PRICE: $702K, +63K from FY 2019-20 The County's median home price increased over the previous fiscal year. Home prices were largely unnaffected from the negative impacts of COVID-19. 360 410 460 510 560 610 660 710 2012 2021 Th o u s a n d s o f D o l l a r s Fiscal Years Ended June 30 § I I I I COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/15 SANTA BARBARA COUNTY, CA ECONOMY AT A GLANCE 750 800 850 900 950 1000 1050 1100 1150 2012 2021 Mi l l i o n s o f D o l l a r s Fiscal Years Ended June 30 TOTAL REVENUES: $1,130M, +$122M from FY 2019-20 The County continues to see an overall increase in revenues due to the positive effect on property taxes as the result of increases to home values. CHARGES FOR SERVICES: $217.3, +$17.1M from FY 2019-20 Charges for services primarily represent user fees charged for fee- based govern- ment services (permits, trash, parks, etc.). There has been a countywide ef- fort to align fees with costs, resulting in an increase to charges for services. PROP 172: $40.2M, +$4.2M from FY 2019-20 Proposition 172 is a portion of sales tax that is collected for local public safety. Prop 172 has increased along with retail sales despite the impact of COVID-19. STATE & FEDERAL: $486.6M, +$117.3M from FY 2019-20 The County received a significant amount in State and Federal programmatic revenues in the current fiscal year to help address the economic impacts of COVID-19. The County's main source of discretionary revenue is local property taxes which is experiencing stable growth. 130 150 170 190 210 230 2012 2021 Mil l i o n s o f D o l l a r s Fiscal Years Ended June 30 28 30 32 34 36 38 40 42 2012 2021 Mil l i o n s o f D o l l a r s Fiscal Years Ended June 30 300 340 380 420 460 500 2012 2021 Mi l l i o n s o f D o l l a r s Fiscal Years Ended June 30 240 260 280 300 320 340 360 380 2012 2021 Mil l i o n s o f D o l l a r s Fiscal Years Ended June 30 SECURED TAX PERCENTAGE TAXPAYER LEVY (FY 2020-21) OF TOTAL 1. Southern California $410,339 0.44% Edison Co Utility 2. CWI Santa Barbara $388,798 0.42% Hotel LP (Bacara) Hotel 3. Southern California Gas $317,849 0.34% Company Utility 4. Miramar Acquisition Co, $287,478 0.31% LLC Hotel 5. Windset Farms $234,034 0.25% California Inc Agriculture 6. 1260 BWB Property, $232,148 0.25% LLC (Biltmore) Hotel 7. Islay Investments $198,447 0.21% Real Estate Holdings 8. Pacific Gas & Electric Co $178,612 0.19% Utility 9. Regency Tropicana, LLC $158,101 0.17% Residential Rentals 10. Celite Corporation $144,966 0.16% Mining TOP 10 TAXPAYERS TAXES: $372.4M, +$22.6M FROM FY 2019-20 BUDGET & ECONOMY COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/16 MAJOR INITIATIVES COVID-19 Recovery The health and safety of our community is our top priority. Our local business owners, non-profit organizations, employees and residents are an essential part of our community. Federal, State, and local assistance programs are available to small business owners, employers, employees, and residents. The County is organizing the information and will continue to provide updates as new programs and policies are announced. When businesses, non-profit organizations and individuals of our community thrive, the County of Santa Barbara as a whole thrives. For more information, please visit https://readysbc.org/economicrecovery/. Renew ‘22 Renew ‘22 is a multi-year transformational initiative to ensure fiscal sustainability and operational efficiency. The essence of Renew ’22 is to fortify the County organization to be more resilient and prepared for the next economic downturn or natural emergency. This does not mean future reductions in budget, staff, and services will not be necessary. The Renew ’22 effort, in its fourth year in FY 2020-21, is designed to ensure our County can withstand these changes and bounce back effectively and quickly. Renew ‘22 charts the course for a stronger and more resilient County government. Recognizing that the pressures and challenges the County faces are unlikely to abate in the near term, Renew ‘22 seeks to build the County’s capacity for innovation and continuous improvement. Building on prior initiatives like the Budget Rebalancing Initiative and Organizational Strategic Plan, Renew ‘22 addresses five core areas: • Re-visioning the organization • Re-balancing our resources • Re-designing how we do our work • Responding to residents and customers with the highest quality of services within our means • Retaining high-performing employees and preparing the next generation of leaders Additional information on the County’s Proposals, initiatives, and progress for Renew ‘22 is available at https://www.countyofsb.org/ceo/renew22.sbc OTHER INFORMATION Laguna Sanitation District The County’s largest utility is the Laguna County Sanitation District, a dependent special district of the County. The District operates a wastewater reclamation plant serving the community of Orcutt and portions of unincorporated southern Santa Maria. The plant is located at the end of Dutard Road, west of Black Road. The District serves approximately 11,700 connections and currently collects, treats, and disposes of 3.7 million gallons of wastewater per day (mgd). Waste water is generated primarily from domestic sources with minor contributions from commercial establishments. The District maintains one pump station and 128 miles of collection system. All of the water is recycled and used for irrigation purposes. In FY 2020-21, construction began on the first phase of the $53 million Laguna Sanitation District upgrade project resulting in an increase in net position as net investment in capital assets. The plant upgrade is intended to extend the useful life of the plant and the work is funded by capital reserves and debt. COUNTY OF SANTA BARBARA | FINANCIAL HIGHLIGHTS | FISCAL YEAR ENDED JUNE 30, 2021 P/17 WHISTLEBLOWER HOTLINE | GLOSSARY Whistleblower Hotline The purpose of the Whistleblower Hotline is to encourage employees and citizens of the County to report any suspected cases of fraud, waste, or abuse, of which they become aware. The Whistleblower Hotline is provided as an alternative reporting mechanism to ensure concerns are properly addressed and as a means for anonymous, confidential reporting. Issues to be reported include: • Fraud - A dishonest, unethical, irregular or illegal act or practice. It can be any intentional act or omission designed to deceive others that results in the County suffering a loss of money, property, or other disadvantage to the County's resources or rights and /or the perpetrator achieves a gain of money, property or an advantage to which the person would not normally be entitled. • Waste - The intentional or unintentional thoughtless, reckless or careless expenditure, consumption, mismanagement, use, or squandering of County resources. Waste also includes incurring unnecessary costs because of inefficient or ineffective practices, systems, or controls. • Abuse - Intentional destruction, diversion, manipulation, misapplication, maltreatment, or misuse of County resources. Extravagant or excessive use as to abuse one's position or authority. Abuse can occur in a financial or non-financial setting. There are two ways to access the Whistleblower Hotline: 1. Call toll-free, (844) 413-4025, 24 hours a day, 7 days a week to speak to a third-party representative. 2. Submit an online report at the Whistleblower Web Reporting Portal: http://sbchome.co.santa-barbara.ca.us/ auditor/whistleblower.sbc Purposeful misrepresentation of reporting allegations may be construed as a malicious act. Allegations made frivolously, in bad faith or without factual basis may constitute defamation and may be legally actionable. Assets - What the County owns. Business Type Activities - Activities financed in whole or in part through fees charged to external parties for goods and services. Component Units - Legally separate organizations for which the County is financially accountable. Deferred Inflow of Resources - An inflow (source) of resources into the government that is applicable to a future reporting period. Deferred Outflow of Resources - An outflow (use) of resources consumed by the government that is applicable to a future reporting period. General Revenues - General Revenues include property and sales taxes. This is the primary form of funding for the General Fund. Liabilities - What the County owes. Net Position - Difference between assets plus deferred outflows of resources and liabilities plus deferred inflows of resources. Program Revenues - Program Revenues represent the County’s main source of funding (inflow of assets) and is made up mostly of charges for services (both governmental and business- type activities), but also includes operating and capital grants (State or Federal). WIP - Work-In-Progress capital projects that have accumulated costs but that were not yet usable or placed in service by fiscal year end. Glossary OTHER INFORMATION Cover image created by Steven Herrera. Interior photographs courtesy of Mike Eliason, Joel Boyer, Suzann Sturz, and Jonathan Rodriguez. Learn more about the Auditor-Controller’s Office and view other financial publications at:www.countyofsb.org/auditor Office: (805) 568-2100 Email: auditor@countyofsb.org Betsy M. Schaffer, CPA, CPFO Auditor-Controller 105 East Anapamu Street, Room 303 Santa Barbara, CA 93101