 I will now call to order the Santa Cruz County Board of Supervisors budget hearings. Clerk roll call please. Supervisor Friend. Here. Coonerty. Here. Rappett. Here. And McPherson. Here. And Koenig. Here. Thank you. You have a corn. Thank you. And for the record is June 21st, 2022 at 9 a.m. Begin with a moment of silence and pledge of allegiance. Is there any member of the board that wishes to dedicate this moment to anyone? Yes, Mr. Chair. I'd just like to dedicate it to Laura Segura, who recently passed away an absolute fierce advocate for social justice and equality. Always respectful, but never unwavering in her outreach and advocacy on behalf of those that had less. Our community is definitely missing somebody pretty large today. She did so much for South County and the entire county. So I just wanna make sure that we acknowledge her in our moment of silence. Thank you. Mr. Segura, in our hearts, please rise for the pledge of allegiance. I pledge allegiance to the flag of the United States of America for which it stands, one nation, under God, indivisible with liberty and justice for all. We have any additions, deletions or revisions to the agenda today? I do not believe we do. All right. Then we'll begin with item four, opening remarks from our County Administrative Officer Carlos Palacios. Okay, well, thank you very much, Chair Koenig and members of the Board. Very exciting day for us in a way, it's like hitting the finish line, but on the other hand, it's like starting the race. So our staff has worked very hard on this budget. And so we're pleased to present it to you. For your consideration this week, the proposed 22-23 fiscal year budget was released on April 29th, and it now includes the supplemental recommendations released on June 7th of this year. Over the course of this week, key departments will be making presentations focusing on their departmental overview, opportunities and successes. Members of the public will have an opportunity to offer input to the Board during public comment periods daily. The information included in within our proposed 22-23 budget includes the CAO's proposed budget, the supplemental budget, which reflects adjustments since the publication of the original proposed budget, also the unified fee schedule and the continuing agreements list. Also the so-called last day reports will include final concluding actions, reflecting changes to the recommended budget made during budget hearings and will be presented next week on June 28th. The online proposed budget has been updated to include the recommended supplemental changes to the proposed budget. And as an additional resource, a budget in brief and a supplemental recommendations document are included within the budget's document library. Next slide. So this is kind of an overview of how we are guided by the budget. You can see that on the left side, we really do focus on financial stewardship, the Board over the time I have been here in the decades before I came really focused a lot on being a very responsible fiscal stewards. And that has paid off for us over the years. So we've kept that as the goal for us. We also know that the operational plan and the strategic plan are our North Star guiding us in development of the budget, which reflect the Board's priorities. And then things happen, right, beyond our control. And those are some of the ongoing challenges that we face on the right side. So this year we have a $1.03 billion proposed 2223 budget, which includes appropriations for special districts and enterprise funds and the $683 million general fund budget. We have presented to you a balanced budget and we continue to actively manage the budget to increase reserves to a projected 10.8% level by the end of the coming fiscal year. So we're very proud of that. I know that you should be as well because we used our reserves to get through the COVID emergency. And therefore we were correct to have built up those reserves. And in this budget, we are restoring them back in our plan to 10.8% by the end of this fiscal year. We also did another thing with this year. We'll talk a little bit more later, which is we issued pension obligation bonds, which will save us over $61 million over the longterm in our pension costs and $2 million, approximately $2 million in the coming fiscal year. We also have controlled our position growth within the proposed budget. We've increased funding position, funded positions by only 21.8 positions after you take out the 40 positions required to open the County Public Defender's office. Of those 21.8 new positions that we're funding in this budget, only 10.8 positions are within the general fund. And even with these increases, the County's authorized staffing is just 3% over our 2008 level before the Great Recession. So if you go back to 2008, all the way to now 2022, we've just added 3% of new staff. And that has come at a cost in somewhat and that are in many ways, our staff are very challenged with having to do more with less. As we look at the challenges that we are faced with, one of the significance we face continually is unfunded mandates from the state of California. The most significant one we will face in the coming year is that mandate to establish a care court. Care court, the goals which we agree with are to provide new services, new options to individuals suffering from severe mental illness. We totally agree with the goal. However, at this point, the bill establishing the care courts in the legislature does not provide new funding for counties to implement this mandate. And we're not sure how we can do such a big new mandate without new funding. And it also does not provide a timeframe to gear up to implement this new initiative. The care court initiative, if it is approved by the state legislature will have significant impacts on county council. They will have to add staff. Our public defenders office, which we're just establishing will also be severely impacted. We'll have to add staff, behavioral health will also be impacted, public guardian will also be impacted all at this point to date without any new funding. So anyway, with that is an example of the continued challenges we face from the state of California and unfunded mandates. As you know, the economy now is problematic, high inflation over 8%. We haven't had this kind of inflation since the 70s. And we are gearing up for a potential possible recession in 2324. I think there's a consensus of economists. If you look at, if you survey all the economists, they say six out of 10 now are predicting a recession within the next year. So that is something we need to be mindful of and careful with. We also are challenged with FEMA reimbursements. We spent more than a hundred million, I believe is in the $150 million range responding to both the COVID pandemic emergency and to the CZU fires. And we are now trying to get reimbursed for those costs from FEMA and it has been difficult. Let me tell you, FEMA has not responding to our requests to process our claims in a timely fashion as often indicated and denied claims. And that is putting us in a cash flow issue as we come into the fiscal year because we need to get those claims processed. We will continue to advocate with them and we may need to contact our legislative leaders for assistance because that is a very severe challenge that we're facing. And then last, we also have concerns with insurance and liability as our society continues to be very litigious, as awards continue to grow very high, insurance and liability costs are rising significantly. And so we are going to have to meet that challenge in the coming year as well. And those are all things that we are faced with that we don't really have control over. Next slide. The other issue that I want to bring up has to do with our local workforce. And this is a factor that we are facing as a county government and in fact, all businesses and all local governments are facing. You'll see that a recent workforce investment board report indicates that the county's labor force participation rate has been at a steady decline since 2015 to today. And you see that since the pre-pandemic peak of June 19, the county-wide labor force has declined by 8.3% reflecting a loss of 11,983 potential workers. This is on top of a decline, which we have never seen before really, in our population in the county, which has decreased by 3.2% as reported by the State Department of Finance in May 2022 population estimate. So we have seen a decline in overall population, but most significantly a decline in the number of workers. This is affecting the agriculture industry, the hospitality industry, manufacturing industry, healthcare, and now it's affecting us as we can face challenges in our search for workers. And of course, one of the main factors in this issue is the lack of housing, the lack of affordable housing that continues to plague California and our area specifically. Okay, go ahead and go to the next slide. I'm proud that the general fund budget prioritizes investments in essential county services and supports our aging facility and infrastructure needs. As detailed later in these budget hearings, this budget provides substantial financing for our public safety operations, including supporting new commitments and supporting ongoing commitments that were approved within the last budget year. The budget fully staffs the new public defender's office and also provides new staffing in our district attorney's office, stabilizes our county's health system, including significant investments in the health services agency and supports the creation of a unified permit center and the integration of the former public works and planning departments into the new community development and infrastructure department. You can see on the slide, just some of the investments we are making, including juvenile hall and county detention upgrades, park improvements, public safety, communication networks, including our record system and our radio systems and also other facilities. Even with these investments that we are making in this budget, we are unable to keep up with investments to adequately finance required costs of our facilities and infrastructure. In 21-22, we completed a capital improvements report which estimated that we have over $300 million in unfunded deferred maintenance on our facilities. And so as we go forward, we have reason to be proud of the success because we are investing in infrastructure but we also know that there's a big unmet gap as well. Next slide. So why do we have a unmet gap in our unfunded deferred maintenance and other issues are staffing so forth? One of the issues that we really wanna emphasize is the systematic underfunding of Santa Cruz County compared to our pure counties and also even the cities that we are in the same county with. It's important that people understand that much of this relates to just history and it's kind of a random event when Proposition 13 was approved in 1978. It froze property tax levels, rates at that moment in time and some governments had relatively high property tax rates. Others had relatively low property tax rates and it froze them at that time. Santa Clara County, for example, had relatively high property tax rates. San Mateo County, Marin County. Santa Cruz County on the other hand had relatively low property tax rates in 1978. So just by random event of when Prop 13 was implemented, we were kind of frozen in place at a low property tax rate as a low property tax rate counting. We only get 13 cents on the dollar of property taxes paid within our county. So just to give you an example and illustrate what this means, if we had the same per capita property tax revenue as our pure county averages. So our pure county are counties that are similar in size and demographics to us. We know that we would have $455 million additionally to what we have now. If we just had the same per capita revenues as other counties that are near us, our pure counties, we would have $455 million in additional revenues to spend. So in other words, our general fund is now $683 million. If we had the same per capita revenue as our pure counties, we would have over a billion dollars to spend. It's hard to imagine what you would do with $455 million in additional general fund money. Well, other counties are doing it. They haven't. The state average, if you look at the whole state average for counties, we would have $128 million more in general fund money. And if you just compare us to Monterey, county of Monterey, if we just had the same per capita revenue as them, we would have $79 million more in general fund money. What about our cities? We are in effect the largest city in the county. We have almost 130,000 people living in the unincorporated area of the county that look to the county for municipal services. If we had the same sales tax as our per capita sales tax as our counties, as the cities in our county compared to Capitola, which has always had a lot of sales tax, we would have over 62 more million dollars to spend. Even Scotts Valley, if we just had their per capita sales tax, we'd have $14 million more to spend. So it just shows you that with the challenge we have in that we're providing both municipal services to the unincorporated area and then county-wide services to the 270,000 people in the whole county, while we have a much lower per capita funding rate than both our peer counties and both the cities that are surrounding us. Next slide. Despite that, we have achieved a lot of successes and I will say that I'm very grateful for the commitment of county staff. We have gone to extraordinary lengths as we emerged from the COVID-19 pandemic and the CZU Lightning Fires. And now we have undertaken new challenges, including playing a key role in the formation of the Paro Valley Healthcare District. I'd like to thank the board for their support of the legislation to form that district. Also the county has provided to date over $5.5 million towards that, saving Watsonville Hospital. In addition, we're on track to spend another half million dollars in in-kind staff support. Also like to thank especially Senator Laird for his leadership in establishing the Paro Valley Healthcare District. That has been a huge lift over the last year for staff. We're very proud that we're on track to save that hospital and return it to local ownership. We're certainly not free of worry yet, but we feel we're on the right track with that. Another huge success and this is really amazing and something I thought I may never see in my lifetime, which is the success of the funding of the Paro River Levy Project. This has been going on for more than 50 years to try and get that project over the hump. And to see this year, not only did we get the $400 million construction costs fully funded from federal and state sources, but we also had the voters in Watsonville approve any property tax assessment to pay for the ongoing maintenance. And that was approved by 79% of the voters. Pretty amazing to think of all that has happened. I lived through the 95 floods and 97 floods. I was the city manager at that time. I know how devastating those floods were to not only the agricultural community and the business community, but also to the populations who live near the river. And so to see this project come to this point is an amazing achievement. I'd like to congratulate the board for your support on this as well as a supervisor friend and supervisor Caput for your leadership. And I know that both of you have truly worked very, very hard on this project. And Mark Strudley and Matt Machado as well from our public works department, especially for all the work that they did. We have purchased the South County Service Center. This will be a really nice achievement for the county to provide more equitable services across the county and also provide better offices and better services to the community down there. We hope to open it in 2023. And then just one example of what we've done with affordable housing, we've done a lot. But one example is a live folk housing project which will provide 57 affordable units. This was a county led project, formal farmer redevelopment site for the county. We actually did the project management that brought the project about. Especially like to thank Julie Conway, Suzanne Issey, Peter Detlef who showed the leadership on bringing that project about. And it's really an example of great success and hope for future goals as well for what we can do with affordable housing. Next slide. The county collaborated with Santa Cruz Community Ventures on a project called the Santa Cruz Like Me which is an effort to look at the county's representative bodies and recognize the value of a representative government and ensure that the diversity of the government reflects the diversity of the region. The county has completed this study with community ventures and is now working on strategies in the coming fiscal year to address variances and opportunities for improvement that are identified in the report. The Board of Supervisors in October hired the first public defender, Heather Rogers. The new public defender's office has been a four year process. A lot of work for our staff, especially thanks to Ms. Rogers, and Nicole Coburn and Sven as well because they have done a ton of work in bringing about this project and the doors are set to open on July 1st. Really a tremendous success. We've also, one of the goals I had many years ago when I first became a CAO was to create a new department of community development infrastructure to merge public works and planning and create a unified permit center. We have done that this year. This will help us to attain our goals in affordable housing, reliable transportation and sustainable environment by integrating public works and planning and forming this new community development infrastructure department. We will be able to collaborate and coordinate our efforts and land use both short-term and long-term and also to focus on more customers for self-focused services and efficient permitting. I also wanted to mention again, the pension obligation bonds, almost $2 million savings this year because we did that, more than $68 million over the long-term that we'll save. And then this year we had successes in leading the construction of our new libraries. Felton, La Selva Beach, Boulder Creek library projects were completed. The Live Oak library construction is nearing completion and the Aptos library just broke ground on construction and construction. Next slide. These are some of our operational plan successes that are derived from our strategic plan. And you can see the various things that we've done, implementing our goals that are outlined in the operational plan. Can go ahead and go to the next slide. And these are other successes we've had in implementing our goals that were outlined in the operational plan. Right, next slide. Our county budget manager will discuss some of the financial challenges we are facing together, including the danger of entering into recession. As the new year evolves, we will face other challenges to sustain investments and successes that we have temp based in the past. We really want to update our operational plan in the coming fiscal year. We look forward to the opening of the South County Service Center and this next fiscal year, the development of a master plan for the Freedom Campus, supporting the construction of the Power River Levy project as it gets underway. And also I'd like to thank our county departments, our department heads and our budget team that both produced this balanced budget but also simultaneously launched what we expect to be an award-winning interactive online budget which is integrated with our strategic plan. Thank you very much and that concludes my remarks. Thank you, CAO Palacios. Are there questions or comments from members of the board? Yeah. Supervisor McPherson. Yeah, thank you, Mr. Chair. A tremendous presentation. This is my 10th budget session, the county budget session and I've never experienced more challenging times. And I'd just like to say a few things for all of our employees and the county's department heads who have really gotten us through the most difficult times that I can remember in the last decade. I'd like to thank our budget team and as we're gonna hear from in our IT staff and on the new online budgeting presentation, I think it's easy to navigate and a number of helpful tools that make the data easy to compare from year to year. This year's budget really represents a great deal of leadership and partnership between our CEO, department heads and our own labor force with our county employees. Considering the challenges we have faced during the last two years, it's amazing we're considering a budget that offers the kind of investments we are making without having to make any significant cuts has been mentioned with the hospital, the center down in Watsonville. It must be said that we have a perfect storm of fiscal challenges this year, I believe, in Santa Cruz County that really require us to be very disciplined with our spending and protective of our reserves which have been mentioned. And that's very encouraging news to hear. Thank heavens we had those reserves in these last three years that we've gone through. We have a low return on tax revenue from the state from our taxes as was mentioned and a higher than average population that does live within the own corporate area that require municipal like services. It's a high demand on housing and with a very low inventory and a local economy that is especially dependent on tourism and the tax revenue it provides. On top of all those systemic issues we've had two years of pandemic response to fire recovery expenses. Some of which have not yet been reimbursed by the state and federal government. And it's really concerning about the state's practice. We have really received some great reserves or revenues from the state, but unfunded mandates is not a nice term in my estimation and we have many of those. So I'm glad that our county measures B and C for transit occupancy and the single use items that passed and they're looking strong that they will pass from the June 7th election. We need those tax measures to help us address these gaps that we're facing. And I want to once again thank our county administrative officers Carlos Plosius for his cautious but ambitious budget and for our budget team that put it all together. I look forward to the departmental presentations this week that are going to take place and hearing more about the great work that our departments do under some very trying circumstances. And especially I want to thank our 2700 employees about half of which in the human services and the health services departments are represented in those two departments. The sacrifices that they have provided and the great service that they really provided for over these two difficult years just outstanding and I can't say enough about it. I wish we could have each and every one of them here to say thank you and to give them a standing ovation. So we're a small county but we accomplish a lot to our terrific and because of our terrific and hardworking employees. I just want to give them an extra pat on the back as I know each and every supervisor does. We got through a terrible storm, not a perfect storm but storms and we're not out of it yet but we're moving ahead onward and upward. So I want to thank the budget team, our CEO and our county employees for everything that they have done in these last two or three years and look forward to some promising advances as we move ahead. Thank you. Thank you, Supervisor McPherson, Supervisor Caput. Thank you. Thanks a lot Turtles and Mark for actually putting in front of us a pretty good budget. It looks good and quick questions. I don't expect in-depth answer on any of them but the AAA bond rating, how does that help us? That helps us get lower rates when we have to borrow money, do we get more money when we actually cash in also? Yeah, the primary benefit is that we get better interest rates when we have to issue debt. And so that's a very positive thing and it helps us with our financial management of the county. And so the rating agencies speak highly of us. They speak about the board's conservative fiscal management of the budget and the fact that we have done a very good job of getting through the CCU fires and the pandemic and that allows us to get better and cheaper interest. Okay, is there any higher rating than AAA? I think that's the highest. Okay. And then general reserves, you mentioned 10%. Money-wise, is that about $50 million or how much ballpark figure? Chair Caput, our reserves, our total general fund reserves are 71 million right now but as you'll see in the slide that I'll be sharing with you, that number is reduced significantly when we start thinking about the money that's set in there for health services agencies to serve the Medi-Cal population. So including our reserves is a substantial amount for the Medi-Cal population. Okay. And then it says on the general fund we're actually spending less, about $5 million, is that correct? Yeah, I'll be happy to go through those details a little bit more in a few minutes, but yes, our general fund budget is actually $5 million less than it was last year. Some of that is attributed to the one-time funding we received from FEMA, excuse me, from the ARPA funds and the disaster funding. We had increased costs for emergency response but we also received some increased funding. On the whole, our revenues and expenditures are down a little bit in the general fund. So you're correct, we're $5 million less than we were last year. Sure. And then with the labor force, we're actually have a few extra open positions but they're not being filled. Is that one of the reasons why we're spending less on the budget because we have a position that's open but nobody has filled it yet? It certainly depends on the department and as the departments will tell you over these coming three days, you'll probably touch a little bit on their staffing and vacancy rates. For example, in the sheriff's office, if they have vacancies in patrol or staffing in jail, that triggers overtime costs. So a lot of times those costs are made up in other ways and some of our charges for services areas if we're short staffed to be able to serve our community, our client, our patients, we often have to contract out for a higher cost. So it's not always the savings but there generally has been a higher level of vacancies across the county in these last couple of years. That's true. And if you go around, that's true for private business and public, people are not filling the open positions that are out there for people to work. So anyway, and Carlos, you mentioned the Pujo River, $400 million state and federal funding. It came down to a vote on the local residents that are in the benefit assessment zone, which means they were in the floodplain. They voted overwhelmingly to approve $1.2 million a year maintenance fee. We've been told that that's one of the highest percentages that a vote has ever passed by different people that have worked with trying to get assessments passed in the state of California, 79% yes, 21% no. I want to also thank the staff for really looking out for South County. We've got the South County Service Center is in progress. And a quick question on the Watsonville Hospital is it bunching forward a little bit? I know we do have a looming shot block. Maybe can we extend the August 31st or are we getting some money? We have two big milestones we're approaching. One is the state of California is potentially going to give up to $20 million to the purchase of the hospital that's in the budget potentially. So we have to wait and hear at the end of this month or they were going to get the 20 million from the state. Even with that $20 million, we're still short 15 million approximately towards the final purchase. We're doing everything we can to do fundraising. The deadline is August 31st to close the sale. I don't think we should assume that that deadline would ever be extended. So we just need to make it and we just need to get it done so we're working as hard as we can. And I'm hopeful that we will raise that final gap before the deadline and purchase. You bet. Okay. Now, Chair Koenig, maybe we should go right into the budget manager's presentation. And then after that, we could potentially take public comment. Okay. And the last question, pension bonds, obligation bonds. How was real quick? How is that different than about 10 or 12 years ago when I first got on the board? We're saving money somehow. Is that because we've realigned the whole pension process? Yeah, we have done that. We have reduced future pension costs because both the board adopted a second tier in retirement. So the board did that. And then the state of California also adopted a third tier for new employees of reduced pension costs. And then our pension obligation bonds are in effect refinancing the debt we have on the unfunded liability we have for existing pension costs. So in effect, we refinanced it at a lower interest rate and that's how we're saving funds. You bet. And just a quick reminder, about 12 years ago, the state of California, there were numerous cities and counties that were facing bankruptcy. And a big problem at the time was pension obligations, people that were promised one thing and the money seemed to not be there. So that was a big problem we have addressed. And I think the board of supervisors looked closely at that and worked very hard on it. Thank you. Anyway, that's about it. Good. Thank you, Supervisor Caput. If there are no further comments or questions from members of the board, we'll move to a presentation by our County Budget Manager, Marcus Pimentel. Thank you, Chair Koenig, members of the board. I am Marcus Pimentel, your County Budget Manager. Thank you for giving me this opportunity to present to you this really phenomenal 22, 23 proposed budget. I say phenomenal from the perspective of the challenges it was to build a balanced budget with instructions that we gave out last fall to departments to be austere. We felt uncomfortable with the direction the economy was going, we were nervous about it. Certainly when January came around, we got even more nervous. But I was very thankful for the direction from our CAO, Carl Sposios, who was firm with saying we need to be very mindful in developing this budget and what turned into being a very austere. And I like your words, Bruce, a cautious but ambitious budget. I'm gonna take a side note for a second that happens to be my daughter's 21st birthday. Wherever she's at, happy birthday, Kirsten. Well, I didn't expect that. I hope at the end of my presentation, I joke sometimes I used to have a nickname PowerPoint Pimentel. There's one time I had a slide deck that went over 80 slides. I'll keep this one briefer than that. But over these slides, I hope you to leave you with an understanding of our forecast, where we have our opportunities, and where we see our challenges. And some of those include our reserves from the perspective of as we see a higher risk of more climate-driven economic disasters and other events, we need to be mindful of are our reserves sufficient to be responsive as well as some of our other unfunded liabilities that we have out there. We wanna address those. And I suspect in partnership with the Auto Controller, we'll be bringing back some discussions during 2223 on how we might further strengthen our position. What I am the warm-up act for today is reviewing the county's general fund overview, but then later providing a real brief overview of all of our general government departments that are included in the budget hearing, but are included in consent. And then I'll be setting the stage for your two presentations today from the Human Services Department and the Health Services Agency. Thank you all of this. Today opens up our budget hearings over these next several days. We will be reviewing the departments for Health and Human Services, as well as providing an overview of all the departments that are on the consent agenda. Today, those departments are within our general government services area. Tomorrow's land use and community development, community services day. And we're also having the Office of, OR3 Office of Recovery, Responsible Resiliency present tomorrow. And then we'll conclude on Thursday with public safety. Or since they conclude, we'll conclude this week's hearings and then we'll continue the hearings to next Tuesday in the afternoon to conclude all of our budget actions, including the unified fee schedule presentation and the concluding actions to approve the budget. We'll then come back in the fall, as we do every year to present to the board the final form of the adopted budget that will then be transmitted to the state that I scheduled for September 20th. As I mentioned before, this budget was built with the premise we saw some cautionary signs ahead. And this was around September, October, November of last year. We've seen those signs become more alarming and we'll talk about that in a little bit. But from the positive perspective, we were able in those very austere moments, hold our funding to, yes, we've added 61.8 positions in the general fund, but of those as CAO Palacios mentioned, 40 of those are to stand up our public defender, 11 of those are within our internal service fund. So on the whole, 10.8 across our general fund was just quite an incredible low amount when contrasted against the demand and services and the requests that are out there. Our overall are proposed expenses and the 1.03 billion dollar budget is down 3.7% as are our revenues down 4%. This is a similar theme when we see the general fund budget. In the last couple of years we've received a lot of one-time funding to support our emergency response and we're starting to move away from emergency response back into normal county operations. On the left is just a summary of our budget broken down by the major funds. You see that the general fund is the largest component of the county's fund structure. I do apologize for the size of the font here. That was something I should have thought about a little bit more as I presented this, but these are really graphical presentations of those total $1 billion in expenditures countywide or a countywide budget. What this is illustrating is that within our help and human services they remain consistently the largest place where we invest our budget allocations at 48.8% for the 22, 23 year land use and community services consistently around that 25% mark there in the second category. That includes the consolidated community development and infrastructure department that includes the former public works department and former planning department. Why land use is so large share and why it'll be so small later on is when you pull out the public works department a lot of their funding is federal state funding for roads and facilities as well as some of their enterprise funds. So at the countywide level, land use is a big component but when you look in the general fund much of those costs are removed away. The pie chart on the right illustrates our costs in a different view. How do we spend our money within departments? And probably not to the surprise of anybody who don't build widgets. We provide services, the bulk of our costs are our salaries and employees. What is a little bit different than city land is many of our while salaries employees that costs are largest at almost 38% for the 22, 23 budget. We also have a large amount of professional service partners that help us deliver services across our county spectrum and those are largely in the health services area and human services. So while salaries and employee benefits are large at that 37.9% of our total budget, services supplies is also equally large at 33%. And a big chart, a big driver in that is are those partners who help us deliver services. These percentage allocations have remained reasonably consistent over the last decade. Flipping into our revenues, moving on to our revenues, helping human services is the largest revenue generator both from an intergovernmental, federal state revenue perspective, but also from charges for services and delivery of services. As compared to their expenditures, there are about 40% of expenditures and about 40% of revenues. And that's also routine and normally typically recover most of their costs either through federal state claims as well as charges for services. From the revenue perspective, our second largest categories are county financing and that's just another way of saying our tax base including our county financing, our property tax of vehicle license fees sells taxes. That is our second largest revenue source, 180 million, 18.7% across the entire county. On the right side, drilling down to where does the funding come from? Where does it originate from? I mentioned the federal and state, our largest share of funding for the county is 45.7% from federal and state revenue, largely moving and flowing through road funding, but also our health and human services departments. Charges for services, that's our client delivery services, whether it's a permit center or clinic fees, those are our second largest revenue source where funding comes from 24, almost 25%, $239 million. I'm gonna slowly move away from the countywide view because we end up spending most of our time in the general fund. That's where you have the most challenges but also a lot of our opportunities are designed. But I do wanna paint the picture of the 2,700 staff that Bruce and first and you referred to and they've done phenomenal work over these last several years responding to dual emergency events. Health and Human is our largest service providers and directly our largest staffed areas, 1,350 people reside, funded positions are in those departments. The second though is our public safety and together these are almost three quarters of all of our staff are in health and human services in the public safety departments and justice departments. Together that's almost 2,000 positions. I think it's 1,998.9 positions. One more positions there'll be even 2,000. So that's where we, you've seen, we've talked about where we invest our money. A lot of our budget goes to health and human services and where we invest our positions, health and human services and public safety and justice. And that speaks to what CEO Plosio said, because we're limited in our resources because we have some systematic underfunding we really try to focus our resources on those pure mandates that we must deliver on. So I'm happy to move us away from Countywide and really where we spend most of our time most of our discussion is in our general fund. Chair Caput as you noted already our general fund has been reduced this year both expenses down by 5 million and revenues down by 9.4 million. A lot of that is driven by the one-time end and demobilization of our COVID response and the end of our CZU fire response. Not the end of the resiliency and the recovery of those events, but the direct cost perspectives. It goes without saying that we are concerned about our future, not from a perspective of how will we get there, but we know we will. But we have gaps in our forecast and those gaps have been consistently there. When we look into our out year of 2526 we're still facing about a $10 million funding gap and that presumes maintaining those very minimum service levels that we talked about prioritizing funding in our public safety and justice and our health and human services departments. We don't have a lot of other programs that are easily scaled down or shifted. So it's harder for this County of our size and our limited size compared to other counties to adjust and adapt and downsize. But what this chart tells us is without other funding sources, without other help or without continuing, we're forced to continue to be creative with bridging those gaps and often we've had to bridge those gaps and reductions of services. So just know that our mandate is to present to you a balanced budget. This year's budget is a balanced budget and we will continue to present to this forward balanced budget in the future, but there may be some hard trade-offs and some hard choices ahead should this forecast remain. What is not included in this forecast are the assumptions from revenue increases from the June ballot measures, but we also haven't quite quantified the level of impact and the timing of when the next recession will hit. So this forecast will change in the coming months for sure. When looking at our general fund, it's similarly structured and balanced. The percentages you see here, half of the general fund is for salaries and benefits, 26% is for services as flies. That's been very typical of our County. There are no alarming changes or trends in these numbers, but what you see when you look at, not where we're spending on money, but what programs and services we're focusing on, again, within the general fund, just like Countywide, Health and Human Services is our largest department where we invest most of our discretionary and most of our revenue resources are for supporting the Health and Human Services. As I mentioned to you before, when we looked at Countywide, community and land use was our second largest, Countywide budget, but when looking in the general fund, that drops all near the bottom. And that's just a reflection of the removal of a lot of the public works operations, the road maintenance, the road investments and the enterprise funds within public works are not reflected in the general fund. So the second largest general fund investment is in our public safety and our justice programs. Moving into our general fund revenues, there are often a lot of questions about, our assumptions and increases in taxes and I'll talk about that in a few minutes, but also about the slide that we've talked about when we talk, try to distinguish between total county or total general fund revenue and discretionary revenue. And very simply, we try to get to a point of looking at our total general fund revenue, in this case, $663 million, backing out a lot of those direct funding from federal and state and direct charges that departments will provide. So essentially if they're a business unit, they're direct revenue sources and we get down to net revenue that comes from largely from our tax base. So we have about $182.8 million proposed in the 22, 23 budget that would be discretionary revenue that is prioritized and historically prioritized to help sustain our operations and how that's shown graphically is in this next chart. We see that of that 182 million of discretionary revenue, nearly 104 million goes to support a public safety and justice programs. As you can imagine, those programs often have some, they certainly have some federal and some state supports, but they're not fee-driven. They don't charge for services. So they require a large support to sustain their operations. Health and Human Services have commitments of up at $39.5 million, while most of their operations historically have been balanced. We do pledge and are there to support those departments should they have shortcomings in their budgets. But you can see that a lot of our general fund discretionary money goes to supporting our pure mandates or our delivery of public safety and justice services. I want to spend just a few minutes talking about our revenue growth assumptions. And while sometimes they're either criticized for being too conservative or maybe often you don't hear it being too aggressive, we strive to have our projections be reasonable and credible. And what this chart represents is our largest forward general fund tax basis compared to last year's budget and this year's budget. And we have to own the choices that we made in developing last year's budget. You can put yourself in the timeframe of January, February, March of 2021. The pandemic was heavy. We were just, we were still understanding the impacts from the CZU fire in the fall. And we had high concerns that the economy was going to be impacted for a longer period of time with sales and reduced sales tax and reduced visitors. Thankfully what we saw is by the summer of 2021 and into the fall of 2021, before the next surge hit we started to see strong recovery of our sales tax base. Now as we look back, we can confidently say our sales tax base and our TOT base has recovered to pre-pandemic levels. Are they thriving at 10, 15% growth patterns? No, but they have recovered to their pre-tax level. So what this chart illustrates is where we had the budget last year for our property tax vehicle license fees and what we're seeing in the increase in this year's budget, 5.6% increase in property tax knowing that we've had recovery and reimbursement from the state from some of our losses from the CZU fire and assessed values. Vehicle license fees continue to be steady but we've seen the strong recovery of sales tax and transit occupancy tax back to a pre-pandemic level. So that's great news. And that's strengthened our bottom lines. But as I'll talk about, I always have to mention we do have concerns, sales tax is very dynamic source. We get data almost on a monthly basis. And it's the first place where a consumer driven economy nearly 70% of our GDP is based on consumers. So those as inflation continues to go up gas prices and everything else. And as the employment market worsens and employment rates might rise, the first sign we'll see is sales tax shrinking will be an indicator that something is going wrong. So we're going to continue to watch sales tax very closely. It's an early arbiter of what's to come but we are concerned about out years growth in the next two or three years in sales tax. Almost to the end of this little presentation, wouldn't be doing justice of keeping this board immense credit and CEO Clausios and the leadership team of this county. They've built up the reserves to $71 million in the general fund. That's a remarkable level, a 10.7% of reserves and that's to be rewarded. Sitting in on very numerous of our bond rating calls. We get a lot of accolades for how fast we've recovered from the pandemic and built back up our reserves to that 10% target level. The place where we have more work to be done is when we look within those reserves and we've known this always to be true. A lot of that big chunk of that is reserves pledge to serve our Medi-Cal populations. So to the point when we need to use those reserves and serving our Medi-Cal population whether it's expanding services or developing new facilities such as the freedom master plan, we have to start thinking about a life with reduced health services and Medi-Cal reserves and what that life would look like today if that money wasn't there is our reserves would drop to 6.2%. That's a hypothetical they're not at 6.2% but if we fact factored out those reserves we'd have about a 6.2% reserve level and it's compared to payrolls that would cover us for 2.8 payrolls. Those are very alarming numbers from a fiscal perspective given our high risk of climate and proximity with the ocean and other earthquake events. We have higher risks than many other counties. So it's to our benefit to start thinking the long term about how we build up our reserves is included within these reserves our emergency response reserves. They're not a different pile of money. It's all in the same place. So we've got some additional work to do and I'm confident we'll get there of making sure we're resilient and sustainable in the long term. Finishing with the down news as we often do I do promise I'll finish on an up note. Since World War II anytime the yield curve has inverted it's been a predictor of a recession coming and what that means is bond rates typically if you're investing the longer out you invest the higher you yield you buy a 10 year bond. They're gonna somebody's gonna hold your money for 10 years so they give you more interest. What happened in March is that yield curve went shorter where short term money was more expensive than out long term money. You actually lost money by going out 10 years. That's a very unusual occurrence and every time that occurrence has happened within three years has been a recession since World War II. It's not a driver of a recession but it's an indicator of some really concerning times in the market and certainly since March we continue to see inflation going up as CAO policy has indicated. Economists are now the majority of them are predicting a recession in the near term. So we're thinking in terms of our next budget instructions and to continue to monitor the 22-23 year should the recession get it's no longer if we think it's when and then how long will it be and what will be the impact. Will it be in 22-23 possible? But definitely in the next two or three fiscal years it's very likely we'll have a recession. Now thankfully this economy in this county has been done a very phenomenal job of being very diversified in its revenue sources. It's tended to weather recessions reasonably well as compared to some of our companion counties in the central valleys. But yet we do have challenges in our systematic underfunding and it limits our ability to be responsive and resilient through disasters. But I do want to finish on a high note. It's really quite impressive. I'll admit to, I've been in the county for since just August of 2019 and the amount of work that this county does is incredible compared to the staffing level and the funding level that it has. When we've been doing some peer review over this last year and a half and talking to other counties and the time it takes for them to complete projects like those that CEO Glossius talked about would have been generational five years, six years, 10 years. Now the Power Valley Levy project is one of the generational projects but that's not because of a lack of our work. It's been a lack of federal and state funding but we've done some phenomenal work and we continue to do phenomenal work every year doing unheralded work that is, for me it makes me really proud to work here and I'm proud to be part of this team. I've loved the strategic plan that we've developed. I love that we have an operational plan and I'm a big fan of seeing how our budget will drive and support the operational plan going forward. I'm concluding my opening remarks. We'll go on down into reviewing and laying the groundwork for today's budget hearings but I want to finish with just where Carl Glossius ended. It is remarkable when you talk about our successes that we built an online fully interactive, fully confident budget in the time space that we did using all the in-house staff. We did partner with OpenDepth to provide a budget system behind the scenes but this was a phenomenal budget built to be long-term integrated within our strategic plan, within our operational plan and updated frequently. We've never had a budget that dynamically changes. I showed you the stacks of different versions of our budget that we take to get to be adopted and now it's one version. You'll see the proposed budget, you'll see the changes marked as supplemental. You'll eventually see changes marked as last day and then the changes for the adopted. We're really proud of the work that's been done. It's quite impressive on the first release, the quality of it and the capacity and the capabilities of it. So we're only thrilled and excited about the opportunity it has for these coming years. So with that, I want to thank ISD and our CO team and Carlos Flosius and this board who've allowed projects like this to happen despite our limited staffing and resources. That concludes my opening remarks and then I can just jump right into the chair's discretion just doing a quick preview of the hearings for today. All right, thank you, budget manager Pimentel. Are there any questions or comments from members of the board at this time? All right, seeing none. Then why don't you go ahead and give an overview for today and then we'll take some public comment here. Chair, I believe we may be missing slides. We may need to run and grab those. It will just take a moment. My apologies. I could offer all the data I present to you is in the consent agenda. It's in the online budget. I can provide a narrative. This is meant to be just a few minutes of brief overview and then we can turn the floor over to human services and health services. And I apologize. I should have coordinated to make sure we are set up on that, my apologies. So within the consent agenda item are our general fund, general governmental departments. A lot of our general services departments, the audit controllers office, the assessor's office, the clerk of the board, the clerk of elections, our office, the county administrative office. In total, I'm gonna give you a big number, 115.2 million in total operations. But when we back out and just focus on the general fund, the general fund portion of that budget is just about $41 million and that's not a just, but that's a lot of services that are provided at a $41 million budget. There are as disclosed in the consent agenda items for each department. Each department has its own budget report. There are only a modest amount of changes within the general fund departments. Largely, there's been some staffing increases, no programmatic changes. The public defender is a big change this year but that's in our public safety departments. Where you will see the increases in those reports are in the county administrative office's department in the assessor and the audit controllers department and in information service departments and GSD. Those four departments have changes that have increased general fund needed contributions about 15% and that's still pretty modest. And where you see those increases is in the county administrative office. We've taken on the sheriff's investigator auditor program. So that is a new budget compliment that's in the county administrative office. We've also invested back in our economic development, increasing a principal planner position from three quarter time to full time to support economic development and other special projects and general services. Some very boring but exciting work for me to think about in all of our team. We'd like to see more focus on our backlog and deferred maintenance. So they're bringing on a custodial position of facilities worker and management position to help with some of our backlog in our general services. ISD as you've demonstrated in our online budget are investing in two application specialists that will help us be more responsive to departments needs across the entire county. And then our auditor controller, it's less of a increase in more of a reduction. Some of their revenues from some prior debt financing to fund their systems are no longer there. So those are the big changes. There's nothing overall notable. They're proud of them. They're proud of their budgets, but on the whole, their status quo is in those few changes I've talked about. Mr. Chair, that's where we're waiting. I might just make one of the things that hasn't been mentioned is another great, had great foresight from our CEO is development of operations and strategic plans that was inclusionary in getting county employees and the general public involved and getting a well-rounded picture of where we are, what we're gonna do, how we want to do it in a matter of operations and strategy of how we want to move forward. That was a really critical element in getting us here to look forward under some difficult emergency situations that we've had. So in development of that strategic plan and the operational plan was really critical in getting us where we are now to keep our eye on the ball and move down the field. So I think that was a great foresight by our CEO and again, the county employees who participated in it was invaluable. So very much appreciative. Thank you, Supervisor McPherson. And I'll own this slide that was just if I kept going with my slides, they would have continued and I was thinking there are different presentations from my apologies, but just finishing off the general government, this chart represents the number of positions that are in total in those various departments and the green shaded are the increases. So the general service and information services had three positions and two positions respectively, again, very modest operations. Where I wanted to preview is our health and human services and then end with you with the recommended actions for today. Again, this is just meant to be a preview of what's to come. Yeah, move me to the next slide. Within health and human services as detailed in the overall presentation, there's our 423.5 million dollar budget. Health at 238.7 million and human services at 173.9 million. Also included in health and human services are child support services. They're effectively status quo. Their funding is derived from a state funding formula and there are no changes other than an unfunded position this year. There's also our core investments and that item has been deferred. It's on consent, it's at deferral. That item was heard on June 7th and will be discussed again on June 28th, next Tuesday. So there's no action today to be done with the core program. Move me ahead. Within the funding support that the general fund provides for these departments, these numbers may be seen large, 21.8 million for human services and 12.7 million for health services. Typically these departments do perform better than that. These are just a budgetary total budget for total costs versus generally a little bit on the conservative revenues. Generally those departments do not depend on very large general fund contributions but we're there to help sustain their services should they be needed. From a perspective of what the change is, this is the change chart of our general fund contributions to those departments. And what I want to explain and why I'm showing this particular one is while it looks like health and human services received considerably larger general fund contributions than the allowed budget for 2021-22, their increases from last year's budget are driven by one time funding that came from FEMA and ARPA that brought down their contributions last year. So when we look year to year, their last year's numbers started lower arbitrarily because of FEMA and ARPA funding. So when we normalize for that, they're actually status quo with their general fund contributions. As far as positions, that's where you see the biggest changes in these departments helping human services. The health services agencies are largest department 752 positions, funded positions. They're requesting the increase of 21 positions and those positions are all across HSA as various services supporting clinics, supporting behavioral health but also in response to preparing for the reforms out of CalAIM at the state. Human services shows a reduction of 27 that is not a reduction in force as a reflection of within human services were COVID shelters. And over the last year, there was always a plan to demobilize the shelters. Late in 2021, there was an extension period to get us another six months of funding. That funding ends in July. So there's been a long plan to demobilize those shelters 51 positions that will no longer be needed come July. So that's a big reduction in their positions. Otherwise they are investing in increasing and their ability to serve our community as times get worse, their demand goes up. There are nearly 17 positions being added to the social services to help strengthen their ability to be responsive. So that finishes with my recommendations for today and I'll gladly go silent and let the departments finish this day of public hearings. We ask that the board consider any public comments and then take action on the consent that we open the public, the budget hearings and consider the regular agenda budget presentations by human services department and the health services agency that we think continue the budget hearings to tomorrow, June 22nd and that these budget hearings will ultimately conclude on next Tuesday, June 28th that effectively concludes my presentations and my apologies on some of the technical stuff that was my own shortcomings and forgetting where my slide decks were. Thank you, Juliette. Thank you, budget manager Pimentel. And we'll now proceed with action on the consent agenda and that's items nine through 24 and we'll begin what's up. I was just going to say, sir, we'll begin with public comment on the consent agenda. So if you have any comments and you're here in the room, please approach the podium. Two minutes, great. My name is James Healy Whitman. Santa Cruz County is just one of 3,200 counties in the United States about the consent agenda items. I think it's items number nine through 23 on the consent agenda item number 12, which has to do with AMBAG. AMBAG stands for Association of Monterey Bay Area Governments. It's actually a secret invisible government that you don't hear much about. If I have time, I'll talk about a December 12th meeting, which is very important. It has to do with water and people asking questions because the various state agencies aren't even talking to each other and they're not listening to the needs of the cities. So about agenda item number 12, it says that the budget was like a little bit over 32,000. The difference a little bit over 32,000. So there was a net gain of $56. That's really odd. Going back to some of the things that the COA stated and that's Carlos Palacios of note before 1915 Board of Supervisors and City Councils were taken over by the COAs and the city managers. You guys are just actors. You guys act really well. Some information I think is odd that I didn't have my exact notes with me was talking about the care court and where the funding, where's that funding gonna come from? Within the past six weeks in this room, $7.5 million were given to organizations that would act as interlaced before law enforcement to help people who were having issues. That same day in the city council, they were given over $14 million for very similar types of services where they have already spent $2.3 million. So there's some inequities with that. I have questions about thank you. Supervisors McPherson, Friends, Tonig, Coonerty and Capit. My name is Sarah Leonard. I'm from MH Can of Santa Cruz. We were completely defunded in the core decisions that were just made. When I had the regular session with the people at core before we turned in our proposal before it was even written, I was told that we were unlikely to be refunded. I was told that by one of the core people at core. To me, that was clear that a decision had already been made and we hadn't even turned in a proposal yet. I also asked for ADA consideration in that I who wrote the proposal I'm a person with schizophrenia. I'm a person with autism and a person living with bipolar and PTSD. If we were in another county, I remember that part of the, if we were in San Mateo County, the peer organization would be receiving over $4 million. If we were in Monterey County, the peer organization would be receiving over $20 million. Santa Cruz County has for a long time not seen our value, I think, as much as you could. And I wish that in the future, you would do that better. I know that some of you have been very supportive. Supervisor McPherson and Caput and Coonerty and your new Mr. Connick, so I don't really know. But we do provide valuable services and we stayed open throughout the pandemic. We provided support to the population throughout the pandemic and when at the heart of the pandemic, people were not showing up to work in the locked wards. The employees in the locked wards were not showing up and we had a subcontract in there. We were providing three to four workers a day in the locked wards and we were the only ones there. So we have really throughout the pandemic, we have been there, thank you. Thank you, Ms. Leonard. Hi, my name's Anne Skechley. I am a peer of MHCAN. I've never been to something like this before, so I don't know how to be all cool about it, but anyways. But I struggle with, not Skechley, Skechtoaffective Disorder, OCD, Acute Anxiety Disorder, learning disabilities and AVD. I've come a long way from being hospitalized when I was 17, 18 to haven't been hospitalized since then at a psychiatric unit. I actually work through MHCAN at Telecare, Psychiatric Behavioral Health Unit and I'm a peer support specialist there. And MHCAN has helped me grow as a person. I've been going there since 2002 as a peer and I really think we help a lot of people in our San Cruz County. We help a lot of people, we provide showers, we provide a meal from the people that donate to us. I'm sorry to cry, but Sarah and MHCAN have helped me so much grow. I'm also a caregiver because of that. We're a very supportive community and I just wanna say please consider funding us as much as possible because we humbly ask that, thank you. Thank you, Ms. Skechley. Hi, my name is Blair Boratius. Hi Blair, could you just get a little closer to the microphone so everyone online can hear you? So my name is Blair Boratius. I am a peer at MHCAN also. Because of MHCAN, MHCAN has helped me a lot as well. I have several disabilities and complex PTSD. And without MHCAN, I would probably still be on, living on the street with no electric wheelchair. And these people have been so supportive. I ask you please to consider restoring core funding to MHCAN because although it's great that we're helping a lot of homeless people, we need there to be a bridge, a place where people can get showers before their jobs like I did, where they can get food and breakfast while they're still out there. Because getting house still takes time no matter how much money you throw at it. There needs to be support for people who are struggling with mental health issues and various things like that while they're working to get themselves housed. We provide so many essential services to people that I think it would be doing the whole community a disservice if we ever did get funded or defunded. And I just want you to know also that as somebody with physical disabilities, MHCAN is the only place that I have ever gone that did not treat me differently for being in a wheelchair. Thank you, that's all I have to say. Mr. Chair. Thank you, Mr. Chair. Thank you, Mr. President Pearson. I know we're going to have the Human Services Department make its presentation today. And I think most people know, but I want to make it clear that we're not going to be making a decision on the core allocations until a week from Thursday on the 28th, but we welcome your comments now. But just so you're not anticipating a decision, there's a appeal process that we're going to find out more about tonight or tomorrow on the Board of Supervisors. So I just want to make that clear, but please you're welcome to make your comments. Please proceed. Hi, my name is Helen Bradley. And everyone I really appreciate you calling me Miss Helen. I'm 77 years old. And I've been going to MHCAN for a long time. And if you hadn't been to MHCAN even to this moment, that I'm standing here, I don't think I would really be alive. I have a little sickness going on with my body. And thanks to MHCAN, it gives me something to do. I don't have to just sit around in my house. I have a place to go to. And also the one for MHCAN, I just wouldn't be standing here because I was the type of person that didn't communicate with people. And thanks to several linens, and this lady named Mayo, they brought me out of the darkness into the light. I'm in the light now. And I thank them for that. How you doing? And please don't cut them off. I don't know how much longer I'm gonna be here, but I pray to God at the length of time that I'm here, I will still be able to attend MHCAN. Please don't cut them off. That's all I have to say. It's a beautiful place. It keeps me, I'm not lonely no more. I don't do without anything. Thanks to MHCAN, I have a place to go to during the daytime. Thank you. Thank you, Ms. Bradley. You're welcome. My name is Lily. I'm from here from Santa Cruz, born and raised in Santa Cruz High. I've seen this town make a lot of changes. I originally came into the mental health system through Victims of Crime in Monterey. I had a diagnosis that took me out of the workforce and left me with severe panic attacks. I came into MHCAN in 2021. I would sweat profusely. I would turn red. I would shake. I would walk around with an ice pack. And they accepted me just as I was in all of my brokenness, all of my damagedness, all of my trauma, all the things. And they loved me and they gave me chance after chance when everyone in my life no longer did. I got sober. I have permanent housing now. I am of service to my community and I'm doing really well. And that's because of MHCAN. I think it'd be a real disservice to Santa Cruz County to not refund this program. It has saved my life. I don't think I would be standing here. I think I probably would have killed myself before now, especially with the pandemic, which has isolated so many of our population. Those of us with severe mental health diagnoses are especially impacted by the pandemic, both in our mental health and with our likeliness to get sick and die. And this place has kept us safe. This place has kept us healthy. And I strongly urge you guys to please consider finding funding and not necessarily defunding, but not refunding the core program that MHCAN has been funded through. It's helped a lot of us and saved a lot of our lives. So thanks, you guys. Thank you, Lily. Hi, my name's Bonnie McCall. Hello, Board of Supervisors. My name's Bonnie McCall. I'm fifth generation Santa Cruz. And growing up here, I've seen all kinds of things. I've seen the people every day that are on the streets over the years. I support MHCAN. I wish you would consider funding them through the core project. They provide necessities. They provide vital necessities. It's a very necessary program in the community. They provide showers, food. They have a kitchen where people can come and make their own food, laundry. We have transportation to and from appointments, doctor's appointments, grocery shopping, bringing people to the center. It's very vital in our community. And I see the difference. It's made a difference in my life. Thank you. Thank you, Ms. McCall. Hi, my name is David Medeal. I moved here about 14 years ago and was referred by my doctor to MHCAN. I've been a part of MHCAN for the last 13 years. I've seen it up, I've seen it down. And right now we're just cruising along. And now we heard about the court rat being defunded. And I just see it's a travesty to all people that go there. Thank you. Thank you, Mr. Piteo. Hi, board members. Hi, board members. My name is Brandon Wampool. I'm originally from Orange County. Orange County has a diverse people for mental health. But since I moved to Santa Cruz about 10 years ago, I've noticed that there's a great care within the facilities of these people. People are very well taken care of. I've also think that the city members also take care of us very well. I have nothing to complain. The only thing is that I would hope if we can get refunded. Other than that, I completely satisfied with this county. Thank you. Thank you, Brandon. Hello, board of supervisors. My name is Sylvia Beard-Blan. And please fund MHCAN through the core grant. It has saved so many lives, mine being one of them. It's not just a place for the homeless to come and eat, shower, and take care of their bodies. But we also provide programs for us to learn how to live, how to live, how to maintain our stabilities, how to learn our triggers and work within society. MHCAN gives us that place to learn who we are and to value ourselves to be in society. Thank you all. Thank you, Sylvia. Good morning, board of supervisors. My name is Deborah Hightower. I came to MHCAN as a peer in about 2017. I'm now an MMA worker, medical authorized activities. And I see that MHCAN has essential programs and group meetings for people in the community, the homeless and the mentally ill. I'm asking you to please fund MHCAN through the core grants. Thank you. Thank you, Ms. Hightower. Hi, my name is Ann Marie Banuelos and I, too, am a member of MHCAN. My diagnosis is bipolar and PTSD. But I, too, believe, honestly believe, MHCAN is an asset for a population in Santa Cruz here for a variety of things. MHCAN promotes healthy minds, recovery, things that we struggle to obtain for ourselves. That is, for me, personally impossible by myself. So without people like Sarah Leonard and fellow members of MHCAN that I've come to know and meet, I'd be by myself right now. And that is not the place where a mental health person needs to be under stress. And, you know, so thank you for listening. Thank you, Ann Marie. My name is Ken Mengen. I know supervisor Greg Kappeth, he's a friend. He knows my story. I write letters. I write poetry. I stumbled upon MHCAN. I live in Watsonville, but I'll take the bus to go to MHCAN. I have one word, but summarized it as family. Thank you, Ken. I'm not going to be long-winded. My name is Trey John Spinner, and I am here on behalf of MHCAN. It will be greatly appreciated if you could put some of that money to the side for us so we can continue providing the resources needed while also assisting the community in growth. Please and thank you. And again, my name is Trey John Spinner. Thank you, Trey John. Good morning to all of you. I moved to Santa Cruz over two years ago and not too long ago, if it wasn't for the staff at MHCAN, I wouldn't be standing in front of you today. They need the funding that they're asking for to help people that without MHCAN would more than likely be found somewhere deceased. That's just plain and simple. They're kind-hearted. They do whatever they can to help the community as well as the people that are, and they just need the funding, and I really hope that you give it to them. Please and thank you. Thank you, sir. Good morning, Board of Supervisors. My name's Breonna Delgado, and we ask that you provide funds to the core grants so that programs such as MHCAN can be funded this year. Thank you. Thank you, Ms. Delgado. Hello, my name is Rachel Wilson, and I'm here on behalf of MHCAN. We would like you to consider the core program to fund us. We do so much for the community, and it's such a great organization to be a part of. Thank you so much. Thank you, Ms. Pelson. Good morning, Board of Supervisors. Excuse me. My name is Ernest Davis. I've lived in Santa Cruz for 22 years. I'm a cousin from San Jose, you know, over the hill. I was born and raised over there. I was fortunate to live in a nice community, a nice home. I went to a good high school and schools. So I moved over to Santa Cruz and I started volunteering for UNICEF and worked at River Street Shelter, provided donations, services, my handyman services. I feel that it's important for every city to take responsibility to be there, to help the mental health community, because we all are part of this society here, and we each got to do our part. We cannot ignore certain things. I feel that MHCAN was born out of necessity out of the belly of Santa Cruz, and it's not going to go away. And as my new, as a drop of water in a bucket, you know, the reverberations of this facility is needed. I feel that it's not going to go away anytime soon. It will remain here in Santa Cruz, and it's a mental health community within the community of Santa Cruz. It's just there, you know, we need your support. I know that you guys handling the city, the budgets, it's a really big deal, you know, and you guys are doing a great job. I would hope that you guys would keep on funding the core fund, and we appreciate you so much. Thank you. Thank you, Mr. Davis. Hello, my name is Laura Chatham, and I wanna thank you all for the hard work that you've done to put together this budget. I just have two things that I don't understand. I'm on the County Mental Health Advisory Board, and I also did, was the volunteer coordinator for the first two years of the pandemic for Food Not Bombs. And I just wanted to ask, in the wake of what is happening on the streets, we all know that more funding for real on the ground services, such as psychiatric counseling, emergency response and stabilization facilities are badly needed. We hear that the funds are available, and yet it seems that organizations like, that are providing these services like MHCAN, are being perhaps cut, and I don't understand why that should be at this point in time. The second question I have is, as a member of the Mental Health Advisory Budget Committee, why weren't we, I was never not informed that there was the court committees going, meetings going on, and I wanted to know why we were not informed or consent regarding the cuts so that we could advise. There's one more thing I'd like to say is that last Saturday I was called to the clock tower. I spent the afternoon trying to calm a man who was having a mental health crisis. I am not trained to do this. I'm a retired high school math teacher. But there was literally no services available. Dominican ER no longer helps stabilize people. Thank you, Ms. Chatham. Good morning, Board of Supervisors. My name is Eric Drake, and I'm a native from Santa Cruz. Born on the West side, I've been living here for like 60 years. And I'm gonna say MHCAN was a lot like what you are. And the police officer in the back. We all serve the community. We all serve in the same hand. You don't cut your fingers off of your hand. I don't think it's a good idea. I, you know, separate from ADD, HDD, and mental depression. All through my life, I was pushed all the way through school. I didn't know how to read and write. When I got into the 11th grade, I challenged the principal of Harbor High School. I told him, I'm gonna sue. He don't let me go to college and learn how to read and write. The person who runs the community like a, you know, the SARB. She didn't want to taught me how to read, and she got a master's degree for me. And she ran all the city schools after that. But see, people just don't care. Not everybody got love. But this organization right here, nothing but a love best. And what you do is you grow. And they helped to pull me out of myself and take responsibility for what I was hiding in myself. And I'm thankful for that. But if you do need the money, I'll sue the motherfuckers. Thank you, Eric. All right, seeing no one else here in the chambers that was to comment, is there anyone on Zoom? Yes, Chair, we do have speakers via Zoom. LS, your microphone is now available. Thank you. Good morning, Leah Samuels here from Human Care Alliance, a nonprofit coalition and leadership organization. I don't have the skills of your staff who gave a comprehensive presentation today in my background's legal. I'm not a fan of changing the roles as you go along. So I struggled thinking about my comments. I believe in a trustworthy system of checks and balances on a process to make changes. That said, the budget process is a little different. Part of the process is that you have discretion in making the final decision. There isn't time to comment on the details, but I think the budget has money to move a little bit more to core. Please consider the purpose of the funding, a local movement to achieve equitable health and wellbeing in Santa Cruz County using a framework that is collective impact, result-based approach that is responsive to community needs. The community needs to be able to rely on some essential services. Please look at the budget as recommended. Ask yourself, not who got the money, but will residents be able to access needed services they've relied on? From someone, I propose the answer is no. Please find some money. There's wisdom in a rainy day fund, but this is beyond previous years. And while that's smart, I suggest that if the budget passes as recommended, it will be raining on a lot of people. And that rain spreads as a defense attorney and dependency attorney. Lack of services leads to an increase of crime and harm to children. And that's gonna cost you more money in the long run. Thank you so much for your time. Also please consider the county could lose significant federal funding with the current budget. And we need all the dollars that we can get. Thank you. Thank you, Ms. Samuels. Well, your microphone is now available. Hello, my name is Carol Bjorn. And yeah, it's really heartbreaking to hear all these stories. And there's a pretty easy, at least one solution is to really look at any bureaucracy you all have and get rid of that bureaucracy. To me, the best example of that is the County Office of Education. So for example, every school district in this county has a board. The Harle Valley Unified has a board. There are eight members, eight trustees on that board. That's an administrative level for that school district. So why do we need a County Office of Education on top of every single school district in this county? What is the budget? How much are we paying for the County Office of Education? They're not adding any value to the education of the students. They're not in the classroom teaching. They're not making a difference in the students' lives. The test scores are not higher. Also, I hear constantly, when I attend meetings, teachers that are underpaid in this county. And it's just heartbreaking to see you all considering completely defunding services that are in the trenches serving people that make a real difference like MHCAN. Yet, you're continuing to fund bureaucracies like the County Office of Education. So please take a very hard, long look at that entity. Honestly, it's not needed. Everything they're doing could be done at the school district level. I do believe the people at the boards of all the school districts are completely competent. They can take information from Sacramento and disseminate it to their school district. There's no need to have a County Office of Education dictating what every school in Santa Cruz County does or does not do. That would be a lot of money saved that could go toward a real need in this county. Thank you, Ms. Bjorn. Mr. Chair, I just want to clarify that the County Office of Education is an independent body, has trustees that are elected throughout the county. We do not have oversight of that function, which in general addresses special need students and so forth. But just to make it clear that the County Office of Education is not under the purview of the Board of Supervisors. Thank you for that clarification, Supervisor McPherson. We have no further speakers, Chair. All right. Well, then, I will return it to the Board for Action. And also just to reiterate, we are not taking action on the core funding today. I do want to thank everyone who came to speak, especially those of you who are not used to speaking in public. So thank you for your bravery in sharing your comments with us today. Any member of the Board that wishes to comment on items on the consent agenda? Mr. Chair, I'm sorry to take up so much time. Again, I want to just on item number, the CAO's budget, just want to thank the CAO for everything it's done on some of these special projects that we have that are forward looking. Really very, very important for us to move forward with the budget that we have. On item number 23, if I could have, for the public's benefit, I've got a couple of communications on the contingencies budget, general fund contingencies. And I want to ask our CAO and budget manager to explain the difference between the general fund contingencies and the overall reserves that we've talked about in terms of how we utilize them. I think that needs some clarification, if we could. The contingencies are not reserves. They're appropriations that would draw down reserves if we use them. They're an allocated budget authority that gives us discretion to respond immediately to emergency events or other needs like that. We also have within contingencies, we've had to increase our contingencies in this year because we have some known costs that are not yet able to be quantified in the budget that are quite substantial that we need to include in the budget so that we would have a balanced and credible budget going forward. Two of the things that were mentioned, reimbursements that haven't come through for us, that's one thing probably that could apply to and unfunded mandates that in this core, that's really a concern. It should be for all of us. We don't know if the state is gonna fund it, but it's not unusual for those so-called unfunded mandates to come down to be implemented, to the programs to be implemented by the county, but not funded by the state. And it creates some emergency financial situations that we have to address. Thank you, Supervisor McPherson. Any other comments or questions for members of the board? Mr. Chair, I'd just like to briefly make a couple comments on items on consent. The board, some years back moved to a consent calendar. We used to have all of these items individual, but, and it is definitely more efficient, but sometimes that we're missing and making comments about some of the great work that these departments are doing. I wanted to acknowledge a couple of departments on today's consent calendar, in particular the County Council team, our County Council, Jason Heath is outstanding. And I recognize that it's not a very forward-facing department for many people in the community, but without them, we wouldn't have done as well as we did throughout, not that we're out of the pandemic per se, but throughout the pandemic, the leadership that Jason and his team have taken on the hospital purchase, the leadership that our land use attorney Daniels is wet and some others have taken on some of the recent land use revisions and all that state housing code changes. And then there's others within the team, Jordan and Melissa and some others that have been working on ensuring public access for trails and some other issues that we have throughout the counties. I mean, really, these are people working behind the scenes, but just doing nothing but the public good. And I just wanted to acknowledge County Council, one thing that I believe is that the council can be both an EL and an IL and the fact that they are always counseling us on the appropriate approach, but also helping guide us to a longer and better outcome. So appreciation, Jason, for you and your team on all that you do, you deserve it. And I recognize that Supervisor McPherson made an acknowledgement at the CAO's office in their budget, relatively small budget in the scheme of things, but we need that entire team to really steer the shift. The innovation and the changes in culture overall have been outstanding over the last few years and it's a really great team. There's a lot of talent and people that I'm looking forward to as time goes on, taking additional leadership roles within Santa Cruz County and the organization. And the clerk of elections, we had a transition of a long-term county elections person. Now we have Trisha Weber. We had a seamless election this last time. I mean, maybe not the turnout that everybody in the world was looking for, but it was a seamless election that's not seen across the country necessarily. I think that sometimes when there aren't problems, we don't take the time to acknowledge all the hard work that's happened behind the scenes. I know that Supervisor McPherson, who served in a statewide level in this capacity, can tell you if it weren't for these at the county level, if it weren't well functioning, we wouldn't have the type of democratic process that we have. I'll just close on information services and look, I mean, we've done more, I think on it, and then there's the technology fund further on. We've done more on our technological advancements in the last 12 months, and then we've probably done in the last few years, and I think that there's been a lot of transition there, but there's a lot of competing interests within that department of a lot of pressures from the Greater Silicon Valley area of innovation, and they've always been able to, A, keep us safe. We're under constant attack from outside forces, even at the county level, as you can imagine, but they've also been able to retain top talent that really helped this county innovate and provide the outward facing. The work that Mr. Pimentel was talking about in the budget, all this takes an internal team to do that kind of work, and so an acknowledgement on that. Thank you, Mr. Chair, for those comments. Thank you, Supervisor Friend. Any other comments from members of the board? All right, seeing none, does any member of the public wish to comment on the consent agenda? I guess we did that already, if that's right, I'm sorry. All right, and then at this time, a motion would be appropriate. I'll move the recommended action. Second. Motion by Supervisor Kinnerty, second by Super... Sorry, my supervisor, for Kinnerty, second by Supervisor Friend. Any further discussion? Seeing none, clerk roll call vote, please. Supervisor Friend. Aye. Coonerty. Aye. Chappett. Aye. McPherson. Aye. And Koenig. Aye. The consent agenda passes unanimously. Thank you. Then before we move to our regular agenda on item seven, we'll take a short recess until 1055. Now resume budget hearings for the Santa Cruz County Board of Supervisors and we'll proceed with item seven, although first to clerk roll call, please. Supervisor Friend. Here. Kinnerty. Here. Chappett. McPherson. Here. And Koenig. Here. Chair, you have quorum. Thank you, Your Honor. Do you see Supervisor Chappett coming now? So we'll just give him a few seconds to join us. All right, then we have resumed. Supervisor Chappett, are you present? All right, we'll take that as a yes. We'll proceed with item seven to consider approval of the 2022-23 proposed budget for the Human Services Department, including any supplemental materials and take related actions as outlined in the reference budget documents and as recommended by the County Administrative Officer, representation on this item. We have the Director of our Human Services Department, Mr. Randy Morris, Assistant Director, Kimberly Peterson and CEO, Analyst David Brown. Take it away. Okay, thank you, Chair Koenig and Board and members of the community listening. As Chair Koenig stated, Randy Morris, Human Service Director, honored to be here with our Deputy, Kimberly Peterson to my left and our CAO Budget Analyst to my right who for the community who does not know this does a tremendous amount of work behind the curtain, Dave, in helping all things budget and all things Board action. So it's really nice to be sitting next to you. So I present this budget. In front of you today is a almost $174 million budget presented from the Human Services Department and as was discussed earlier a number of times and as passed in the Consent Calendar, what is not in today's presentation is the $4.8 plus million of our core budget that is intentionally not in today's presentation because that is being deferred as passed by your Board earlier to be bundled with the core presentation next week. So the full budget and policy issues and decisions can be made all at once next week. Before I begin this presentation, I just wanna take a moment. This is my third budget presentation. I've been here two and a half years and like many human services directors, I am one who professionally promoted through the ranks delivering direct human services in County Government, California, but have never directly supervised or worked within a budget office. So having been here two and a half years, every year that passes, I just more deeply appreciate the incredible work of our Human Services Department Fiscal Office. And I just am coming to understand more and more how much work they do that goes unrecognized. So this budget in front of you today is due to the hard work of the HSD Fiscal Team and Kimberly and I just have the pleasure of giving the presentation. So thank you to the HSD Fiscal Team for all of your work to help us give this presentation. So you'll see on the right of the slide that this is our agenda. We're the first department giving a presentation today and this is the first year ever as discussed earlier by our CAO and our CAO budget manager that we will start with a department online overview. That will be provided by Kimberly Peterson, our deputy. And the purpose of this is to really invite the community, your board and your staff to really look at this new exciting tool that works to demystify the complexity of these budgets and then really invite the public to sort of look more closely at what's in our budget. We are a big complicated budget and anything we can do as public servants to make it more understandable to the community the better if this is your taxpayers money being put at work to help this community. After Kimberly is done giving an overview and walking through some of the online tool will be turned back to me and I will go over the proposed budget. I will particularly then spend some time highlighting some significant federal and state and local changes that impact our budget and our policies. We then have a couple of standalone slides to talk about one of the most visible divisions in human services and that is the housing for health division because all the work we're trying to do as a whole county family and community embedded in the human service department to address the vexing issue that is very complicated and that's homelessness and unstable housing in our community. We're then gonna close out with linking some of our successes in our operational plan objectives. Despite COVID and the complications and vacancy rates we have made some good progress in our operational plans and wanna end intentionally with those positive notes and then close out the presentation by requesting your board to approve the recommended actions of our budget. Before I turn this over to Kimberly to go through the online review I wanna take this opportunity to share my almost three decades of working in county human services, a few reflections that I've had working with community, with advocates, legal and lay, consumer groups, elected officials. It is a really complex endeavor to explain a county human services budget and say how does $174 million turn around and help people? And so I just wanna share three things that strike me. Hopefully these items are helpful to sort of digest and hear what we have to say and make this meaningful. The first is I wanna talk briefly about something called leverage. We are unique in human services along with health and a few other but the majority of departments that bring a budget forward to a county board of supervisors in California are bringing forward local general fund money and saying please board approve this general fund money and distributed this way. And there's a tremendous discretion of the county board of supervisors how to purpose that money and how to prioritize within competing priorities. We are a department, $174 million budget in front of you today, 88.5% of it is federal dollars and state dollars. And those dollars are made in different legislative bodies. And that's at the federal Congress and Senate and in the state legislature and included in those decisions are much of the regulations and direction we get. So what's in front of you today is that full budget, including the 11.5% that is general fund and the vast majority of that budget is actually mandated match to draw that federal and state money. So it's a unique moment for a human services department to come to a county board to say basically please approve what the federal and state government tell us you have to approve to draw 88.5% on the dollar. And I just recognize in my career that's actually a unique moment that most county departments don't manage. The second observation is an extension of the federal and state mandates. I sort of had my aha moment some 15 years ago when I realized a lot of the community does not understand that there is reasons behind why such a large portion of county human services budgets are our county workforce. Federal and state regulations prohibit the contracting out of most of the service we run. We are directed to take that money that the federal and state government gives us and we are required to have that run through county workforce. We're prohibited from contracting out most of our services. So I share that because we often get asked why don't you contract out? It's more nimble if we deliver the service to CBOs and that's not a local decision. That's federal and state regulations that govern our work. And I just wanted to make sure people were that because I don't think a lot of people were and it clicked for me somewhere in the middle of my career. The final statement is my segue to Kimberly to oversimplify this complex budget. I recognize that most of the way the human service department looks to the community is not the way our budget is organized. And I'm going to give you two quick examples. Most of the way the community sees the way the human service department is run is how we deliver services to the community and they are organized in divisions. So we have a child welfare division. We have an employment and benefit service division. Dealers CalFresh and MediCal and CalFresh and more. And then we have adults and long-term care division programs like IHS and APS. So that's the way the community often sees us. But when you look in the budget the budget is intentionally organized differently to prepare for audits to take money that comes onto us and in ways that are called budget indexes. So these are two different languages. So I wanted to give you two examples that Kimberly will share. First is the social services budget index or budget division. That is actually a clustering of all the staffing costs tied to those three divisions. I just described and they get dropped into this one budget division called social services. So that looks differently when you look at it from a budget perspective. Second, you will see a budget index called entitlements. Those are the cash grants and money that we deliver to the community in all of those divisions like in the foster care division payments to foster parents into adoptive parents in the EBSD division, the cash grants under cow works and general assistance. And in the adults and long-term care division the in-home supportive services program that pays wages and benefits to in-home caregivers. All of those are clustered together in one budgeting index called entitlements. So I just share this with you as you now are gonna hear from Kimberly Peterson that when you look at the budget online you will see budget design, budget structures and it doesn't quite directly align with the way our org chart looks. And hopefully that framing will help. And then when Kimberly turns this back to me I will speak more about how our services are delivered to the community. So with that said, I turn this over to Kimberly who walks through the online guide. Thank you. Thank you, Randy. So what you're seeing here is the landing page of the human services department budget. Starting with our mission, we strengthen the community by protecting the vulnerable, promoting self-sufficiency, alleviating poverty and improving quality of life. Our motto dedicated to making a difference is embedded in everything we do. At the bottom of this page you can see that in doing the snapshot of our expenses and revenue, a main driver of the reduced expenses, revenues and staffing is the demobilization of the COVID-19 shelters and the associated pandemic related funding. We'll provide more detail on that later in the presentation. And scrolling down a bit further you can see the budget structure of the department as represented under the heading divisions. And as Randy touched on, due to the various funding streams for the human services department, the budget structure is distinct from the operational structure. Our budget structure is categorized as social services, entitlements, housing for health, workforce innovation and opportunities act, veteran services and new for us this year is public guardian. Our operational structure is how our staffing is organized and how we provide services to the public. And as Randy mentioned operationally, most of our services are provided under the umbrella of social services. Under social services, we have four main operational divisions. The first is adult and long-term care services which the public may identify as having a role in addressing elder abuse and facilitating and home support services. Adult services is also the operating division for veteran services and public guardian. Though each of those functions have their own budget category, their work is integrated into adult services. Second, we have employment and benefit services which the public may know as providing CalFresh, Medi-Cal and Cache Aid as well as employment support. When someone calls the call center, they are calling EBSD. The employment and benefit services division is also the operating division for the WIOA or Workforce Development Board which provides services to job seekers and employers. The WIOA also has its own budget category. And the third operational division is family and children services which the public may refer to as child welfare or protective services. And then lastly, we have administration and administrative services which is the administrative backbone for contracts, finance, IT, organizational development, quality improvement and planning and evaluation. Housing for Health is the only operational division that also has its own budget category though its work intersects with every other division. And entitlements is a unique budget category. It's the second largest budget category with zero staffing. And that's because as Randy mentioned, entitlements represents the cash assistance payments to a particular population. General assistance is Cache Aid for single adults. GA is a state mandated program but with zero funds provided for its administration. That funding is 100% general fund dollars and counties have discretion in how to design their GA programs. How to go Oracle Aid includes those Cache Aid payments for CalWorks clients which is eligible families with children under 18, foster care payments and payments to those in-home support service providers. So now let's transition over to look at personnel details. This shows the staffing across the entire department the chart on the left is a visual graphic of our staffing distribution by budget category. And as just stated at the start of this, budget categories are based on funding streams and are distinct from operational divisions which are how we actually provide services to the public. And you can see very clearly that the bulk of our staffing is under the umbrella of social services which includes that adult services, employment and benefits, family and children's and administration. Some of the services such as WIOA and public guardian are shown separately due to the budget structure but as previously stated, they operate within the other divisions. On the right of this webpage, you can view staffing by budget category or by job classification. It may stand out to you that there's a net loss of 27 positions in the overall budget. The decreased staffing is due to sheltered demobilization offset by increases to mandated services, housing for health and administrative infrastructure. And more details on our staffing changes specifically will be provided during the presentation. So then finally, we'll look at the budget details page. And on this page, the public can view the department as a whole or they can drill down by budget division to view details of each budget category. And then you can scroll down further on the page to where it says description of changes. And there you can scroll down to see details of the expenditures, revenues and staffing changes for the various budget categories. So with that, I'm now going to turn it back to Randy for more detailed information on the changes within our budget, including staffing changes. Thank you. Thank you, Kimberly and Dave for helping us toggle through that. And again, I just want to underline appreciation to the CAO's office for creating this tool and really welcome and invite the community giving us feedback as you look at this tool because it'll be an iterative process. And we hope that this helps you translate a little better and a little more detail with a little more transparency this very complex budget, which I will now pivot to taking a little bit of time to share in more detail. So this next slide gives a high-level overview of the major changes from current fiscal year to next fiscal year broken down by staffing, our expenses and our revenues and on the right, a bit of an in and out. So in the left column, you can see the sort of increases coming in. On the right column, you can see the things that are going out. And as Kimberly said and is actually mentioned by our budget manager, Marcus, earlier today, our major swing factor is we unlike most counties in California who ran a COVID shelter system, we ran those programs through our County Human Services Department, including adding staff to our department through first extra help and then limited term positions that were in our budget. And that's why the demobilization of the shelters leads to a net reduction of positions of 27. But what I will spend more time in later slides talking about is these in, these expansions, but when the net total is there is a more of a reduction than a gain, but I will walk through the gains in a little bit. This next slide is a summary of our supplemental budget. Our CIO, Carlos Placios mentioned in his introduction that this budget includes our supplemental items. This is a technical action in County budget, which is when the Human Services Department forwarded its budget to the CIO and it was made public initially. We after that fact because of new information that came in supplemented that budget with this action called supplemental and just wanna take a minute to make sure though disclosed to the public for those who watch closely what was submitted and was now submitted, these were the changes. These were three groupings of staff changes. The first as Kimberly mentioned in dialogue with the health service agency over the last actually two years we are transitioning the public guardians office from the health service agency embedded in the behavioral health division to the adult and long-term care division of the Human Services Department and that transfer includes seven staff that will now be moved into our budget. Just so the community is aware this was very intentional and thoughtful policy discussion with our healthcare partners. The public guardian office includes sort of two operations. One is the mental health courts and the other is the probate court older adults both of which those actions can lead to someone having their civil liberties temporarily suspended and then overseen by the public guardians office and it was seen as a much better alignment of services to have this office embedded in our adult long-term care program. The second change was housing for health. I wanna take this opportunity to thank my supervisor and our CEO Carlos Palacios who has such a great history of general government and understanding housing, affordable housing and he pulled a team of us together and the end result of that was an agreement to add one position to sort of work within the housing for health division to sort of really focus on grants and affordable housing issues for the population served in health and human services. So that action completed internal within the county family and we submitted a supplemental item to add one position to help focus on this very important work looking forward. And the last is child and family teams. This is a federal and state mandate of our foster care division that decisions super serious decisions confronting families when the foster care system is involved in a family's life need to be done with a team having inviting family and friends to a meeting facilitated by a professional. That function in Santa Cruz County was handled by the health service agency and we made a decision again in partnership with health to have that move within the child welfare division. And so those staff transfers are also part of the supplemental action to move those positions within the human services budget. So this is a bit of a complex slide which is diagnostic of the complexity of what we do. On the left column is a list of some major changes that are impacting direct services. And on the right column are a listing of sort of system changes that are impacting what we do. But I do wanna take a minute to share why we intentionally put this picture of equity in the middle. We are in a moment in time in our history. We just took on Juneteenth as a holiday that just passed for our union represented employees. We've had a lot of discussion about this. Your board has declared racism a public health emergency but these are all just words unless you really put to action trying to make sure that what we do in government is helping address inequities. But government longstanding has contributed to inequities. And when human services department does not do its work well, we actually can exaggerate, exacerbate and be part of the problem. If we do our work right with $174 million we have we can help move the needle in the right direction to lessen the inequities that exist in our community. So basically everything we do is from the lens of equity and we welcome lots of public dialogue about this and public meetings and our meetings with the community to make sure we are doing what we need to be doing. So with that said, I'm just gonna briefly go through this list. If you look on the left column, the first is aging and disability. Anybody paying attention to demographics actually worldwide in this country, particularly in California and certainly in Santa Cruz County the aging population is outpacing the children's population that just crossed a threshold when you look at the trend charts. So we have a growing population of older adults and people with disability in our community. And what we need to do about that is a very serious issue and an important mission for the human services department. So there are actually three actions occurring, major changes that are occurring. One I just mentioned, the public guardian office moving over. The second is thanks to the state legislature there were two act legislative actions in the adult protective services program, both of which led to expanded revenue and expansion in our staffing, which shows up in our budget. The first is a three-year pilot at the state called APS Home Safe, which was legislation to see if adult protective service programs in California, if given new money could when investigating a report of abuse and neglect over an older adult or a dependent adult, if they were at risk of losing their housing and becoming homelessness homeless, could this APS Home Safe funding be made available to help that person keep their housing? Santa Cruz County was one of the counties that was part of that three-year pilot and the legislature just made this permanent funding, expanded the funding and we are having an increase in our budget to expand that work, which is very important. The second is the state legislature extended who in California is eligible by definition for response from the adult protective services program that used to be 65 and older and is now 60 and older and with that increase in eligibility came additional revenue and added up these two APS expanded revenues add to budgets that are in our position with new state dollars. And the last under aging and disability is our in-home supportive services program. There was a $2 wage increase that went into effect thanks to action by your board and thanks to our CAO and human services that held some money aside to bring to the negotiation table with the union representing the providers. It is still not paying enough but it's actually now one of the highest paid wages in the Bay Area, thanks to your board's action and that wage increase. I will speak soon about changes to the Medi-Cal program but the in-home supportive services program is a Medi-Cal program and California has passed legislation to make immigrant undocumented individuals eligible for Medi-Cal, which is anticipated to make more people eligible for in-home supportive services. And last, we are tracking very, very closely of an important issue that currently is not funded if we're waiting to see how the state budget settles and that is an issue confronting all of California which is when a care provider scheduled to go into the home to help an in-home supportive services consumer when their caregiver cannot go into the home we do not have a very effective backup system in California. So there is legislation on the table to fund a more robust backup registry system and if that passes that will be a very meaningful change to help our very vulnerable clients in IHSS. The next item in the child welfare system, this is not getting a lot of tension given COVID and other issues but in the child welfare space one of the largest pieces of federal reform in the last decade is been passed. The state government is negotiating with the federal government how to enact this federal legislation and to oversimplify what this means. The act is called the Families First Prevention Services Act FFPSA that people are reading this and what this essentially means is currently federal funding for foster care or child welfare programs. You only get federal money if a child is brought into care and the more expensive care they are put into meaning the more distant they are from family care like a residential treatment program the more federal money you're given. If that child successfully returns home you lose that federal money. So this act actually creates an incentive for child welfare systems in the country to put their money more towards prevention and less of their money in the back end and higher cost care. So when and if this goes live in California we will have a very meaningful set of reform in the child welfare division throughout California and here in Santa Cruz. Coworks, thanks to our state legislature they and this is a very small and nuanced issue but one that is gonna lead to more Santa Cruz County residents being eligible for coworks and that is there was a increase in a very technical term in income deduction. So when people apply for coworks there is a whole regulatory process that's played out and the eligibility is determined and until this change you had a $90 deduction basically available and if you went above a certain amount you were ineligible for coworks. That has been increased fourfold to a $450 deduction. Small regulatory talk but what that means is more people in Santa Cruz County will be eligible for coworks. And when they were enrolled in coworks they then become eligible for a host of other federal and state funded programs like transportation, childcare, diapers, drug rehabilitation, housing, utility costs. So it's a very meaningful change that will increase who's eligible for coworks. The next local initiative Thrive by Three which was presented to the board a bit over a month ago a very celebratory energy with our first five our health agency, our nonprofit community and we have agreed under your board direction to expand who is eligible for what was Thrive by Three to Thrive by Five. So we will expand that work. The state legislature has added a lot of money which makes this more possible and we look forward to moving this effort forward next fiscal year. Medi-Cal, some very significant changes in Medi-Cal first is undocumented immigrant population very meaningful issue here in Santa Cruz County. California, due to California legislation has been expanding the immigrant populations eligibility for Medi-Cal and effective May 1st of 2022 just a few months back. Now anybody who is 50 and older who is an immigrant is eligible for full scope Medi-Cal and what that means in practice is before this change you are only eligible for something called restricted Medi-Cal which basically played for an emergency room visit and there was no funding to pay for preventative services and the services provided for community health clinics unless it was on the local general fund dime for the Medi-Cruz local indigent program. And effective in January, 2024 the state legislature has promised to make all immigrants eligible in California for a full scope Medi-Cal. So these are two very meaningful changes in the Medi-Cal program that will go forward this next fiscal year and beyond. And then the last one is the public health emergency led to a number of waivers in California and one of them in California was that all people on Medi-Cal were not required to submit paperwork to be redetermined to be eligible for Medi-Cal. Every year somebody on Medi-Cal has to go through a redetermination and that was waived for the last two years. We have about 20% of our Medi-Cal clients lose coverage during redetermination and during the last two years nobody lost coverage. So with the ending of the public health emergency this upcoming fiscal year we have a lot of work to do with our community partners. We've been working with the health improvement partnership, our local managed care plan to try to make sure that everybody on Medi-Cal does not get dropped during the redetermination when for the first time in two years they have to submit that paperwork. I'm gonna save the housing for health to some standalone slides next but tremendous amount of reform opportunities happening there. I'm now gonna switch to the right side of the slide and this is the most dense slide and I'll carry through the next set a little quicker. So system change, master plan on aging. Your board before the master plan on aging and action of Governor Newsom was passed already directed the CAO's office, the HSD department and our local nonprofit area agency on aging to work together to apply to be an age friendly community. That effort was embedded in Governor Newsom's executive order that said we need to take this demographic change seriously in California and prepare for this fragile safety net that needs to be better organized and better resourced by creating a blueprint called the master plan on aging. So we are working closely with our area agency and aging and human services with our CAO and with two board members, supervisor McPherson and friend who sponsored that original board direction to apply to be age friendly on standing up a governance structure in our county to move this effort forward. The next is the shelter demobilization that was mentioned many times. I just wanna highlight some really difficult figures to digest. We had over 1,000 shelter beds in Santa Cruz County. And if you remember the start of the pandemic over two years ago, it was thought we were gonna contact trace our way out of the pandemic. So the federal government basically threw a bunch of money in the country to just help people who are housing insecure or actually literally homelessness to get them in shelter basically so they would not contract COVID and the thought would be really quick. So two years later, this money came on in not to help people get into shelter and then move on to housing but just to protect them from getting COVID. That limitations of that money is a byproduct and quite a lesson learned of if you just put people in shelter with no services, you end up really stuck with what to do when you get to the other end and that money goes away. So those 1,000 shelter beds in the last of our shelters are being demobilized at the end of the month is translated until we are back to where we were before COVID which is under 400. And that 1,000 beds that stood up were two years of $50 million of funding which meant we had over $100 million of new federal and state money. And the harsh reality is that still did not effectuate what this community sees up to and including the encampment behind this building. So it is a lot more than having $100 million of federal money which we'll talk about later on the housing for health effort and how complex this issue is. Disaster preparedness, this community suffered through quite a tragedy with the fires. I wanna remind your board and the community listening that in California, the human services department and county government is responsible to provide mass care and shelter services. What has really surfaced is two things I wanna highlight about disaster preparedness that came out of the CZU fire experience and the many others throughout California that predated and have been since. Number one, human services department are mandated by federal and state law to provide disaster response to our clients and our capacity to provide disaster response to our own clients competes with our responsibility to employ our staff to provide mass care and shelter for the entire county. So that response to clone ourselves and do both has come up in state legislative discussions that we really need to fund county human services departments to be able to provide what we call continuity of operations and help all of our clients in the disaster get support on top of the mandate to help the community. The second is I wanna highlight what is called AFN, access and functional needs. California has recognized in the last five years of fires that the population most likely to unfortunately die in a fire or to not do well or to stain serious injury are people with access and functional needs are disabled clients, our older clients are people in wheelchairs. So we have a lot of work to do as a human services department and as a county to figure out how to resource ourselves well. Thank you to the OR3 office and the leadership of your board and the county for standing up OR3 and we have a lot of work to do ahead in disaster preparedness on these two points. The next is the Westridge office. We really look forward to having our South County staff which is a little more than half of our staff who serve where poverty is most organized our community in the Southern part of this community to be moved into a county owned building. We have an opportunity to consolidate our staff into one building and we are working closely with a number of people in the county to stand up the Westridge office as a meaningful piece of work and something we really look forward to if we can keep on the timeframe in about a year plus from now to have our staff move there. Second to last one is Cal Aime that was mentioned in our budget manager Marcus's presentation this essentially and I'll say a little more about this in the housing for health slides. This is a major piece of reform which is the way in which people who are enrolled in Medi-Cal get services in the community is mostly delivered by a local managed care plan and in our community that's the alliance. And so this is the most major reform effort for how Medi-Cal services are delivered in our community and we are working very closely with our colleagues in the health service agency and in the local managed care plan of the alliance to move this forward to best serve the clients that we serve in human services. And then the last is a major change in the state of California is our system that we use to provide services and keep in a database are 90,000 clients that are served through Medi-Cal and CalFresh and CalWorks is called CalWin and the federal government mandated that California consolidate from what used to be four systems to now two down to one called CalSauce. It's very boring government talk to people outside of this world but I have to tell you to move 90,000 people from one database to another where the tools and the engine helps determine who's eligible for what is a massive change and that we have a number of people in our department and throughout California who run human services gearing up for this change and we are scheduled to go live and shift to this new system during this upcoming fiscal year. So that was a lot but that is the nature of human services which we respond to these major changes. This next slide attempts to take what Kimberly presented when you were looking at the online tool and looking at the staffing changes and break them down by the operating divisions. The first is I wanna recognize the administration division and if I can just use a hopefully a simple analogy that will resonate with you. The human services department used to be a car of a certain size with an engine that function very, very well, very smooth machine. My predecessor and her predecessor ran a very good system and the administrative backbone of human services I call it the engine of that car function very well. The stress of the fires handling the COVID shelter system taking on the housing for health office and the staffing challenges we have and the vacancy rates that sort of our workforce issue throughout our country. It has really highlighted that our engine needs to be upsized. We basically are now gone from a car to a truck and we don't have the administrative engine despite the amazing heart and soul of all our administrative staff. And so you will see basically a right sizing in the budget to invest more in our contracts office or fiscal office or analytics office to be able to catch up and right size our engine. So I wanna thank our administrative staff who has been bearing the brunt of that undersizing and we appreciate the CAO's office supporting our request for a number of these positions in the admin office to be able to catch up and right size. Direct services divisions. I wanna start with recognizing employment and benefit services is not listed here. There are no positions in the budget and is that a byproduct of tracking federal and state funding? We actually have six unfunded positions for EBSD in our budget but they don't show up in the budget presentation because we're waiting to see how the state and federal budgets land. And then we will go forward and fund them as long as we have new revenue. In the adult and long-term care division mentioned the supplemental action of the public guardian. We mentioned the APS expansion and I do wanna highlight the one senior human services analyst because this position is being added to the division to help support our master plan on aging efforts and also to be able to work more closely with our OR3 division on the access and functional need clients in a disaster. So great appreciation to the CEO's office and my team for finding the funding to be able to add that capacity. The family and children services division is a combination of the transferring the child and family team functions and also the federal and state government added some more money to county child welfare divisions to expand investigatory capacity in our emergency response division. And then lastly in housing for health I'm gonna share a little bit more about the next slides and I just wanna end on this slide to say that program manager working title is the one that I talked about earlier where we added in the supplemental to have more capacity to apply for grants and to track grants and to work on affordable housing policy for some of our vulnerable populations. Okay, so now I will try to walk through housing for health. This is obviously a very complex issue and Dr. Ratner, our division lead and I will be back in front of your board for our six month report in an August but in the budget in front of you today is a number of changes impacted by what's listed here so I wanna take the moment to just highlight them quickly. So number one project home key for those who are reading the media you might have heard the word room key and that was the state funding that grabbed the FEMA funding that stood up a lot of our shelter capacity and COVID took over some hotels. Home key was the state's action to then create money for local communities county government nonprofits to then purchase those hotels or purchase other sites or stand up affordable housing or shelter sites. Your board approved our department applying for four project home key grants. We were awarded the first one, which is the Vets village and then it was just announced last Friday that the park process in Manukone's district was approved and that was wonderful. Thank you for your support to address the citing issues and there's a wonderful event with the state and the press on Friday and we have two more outstanding. So this does not show up in the budget but once we come back to your board to accept these funds this will expand our budget. Second is something called a vendor pool. We will discuss this in more detail in August when Dr. Ratner I in front of you this is a concept that counties in California are initiating to help deal with the very fluid and very fast moving money that's coming from the federal and state government that takes too much time in a normal procurement process in government to get to the community. And it's essentially an opportunity to do a request for qualifications of vendors who wanna provide housing and homeless services get them in a what's called a vendor pool seek board authority to have the humans of our services department instead of the typical procurement process select from that vendor pool to be able to turn around contracts very quickly so we don't leave money on the table or waiting to get services going. Mentioned the COVID funding declines and the COVID-19 shelter demobilization and CalAIM. I wanna mention just an example of how CalAIM can help the mission of the housing for health division. It previously was not an option to have MediCal pay for housing related supports. California through waivers started to try to do that through something called the whole person care pilots that were managed by the health office and managed care plans. And now that CalAIM is going live is the permanent replacement of the whole person care pilot there is gonna be opportunity to have people enrolled in MediCal and in the local managed care plan have services to pay for temporary housing and housing related services. And we are working very closely with health and with the managed care plan to make sure as soon as this goes live we can add these services and supports to our clients. And with a few major emerging issues we are all struggling with the continued lack of affordable housing that is a major driver. You can provide as much health and human services as you can find, but if you don't have a place for somebody to live and conversely, if you only have affordable housing with health and human services, you need both. So I think we're doing good work expanding and better aligning our health and human services but we need to continue to focus on affordable housing. And again, thank you to the state for making the home key grants available and we hope we get the next two. The next issue I wanna piggyback on my statements earlier having $100 million of pandemic money to just put people in shelter alone does not address the issue. And if we only in California in this country focus on shelter being the goal we are never going to fix the issue of homelessness in our country. So it's a paradigm shift given people lack confidence and hope that people who have complex issues can get into home permanently. But if we only keep focusing on shelter we will never get to the end goal that we all share. So I think this is a paradigm shift we need to keep working on. Competing local priorities, city and county governments throughout California are constantly confronted with new money and for using that money to address an immediate issue in front of you without investing in the long-term issues. And our job in housing for health is to bring forward those competing priorities in a thoughtful way to think about trade-offs and to continue to push for discipline to not lose sight of the long-term benefits of putting money to long-term investments versus just fixing immediate issues that tend to only solve an issue for a couple months and then they come right back. I will share a little bit about the funding for the backbone of our housing for health division in my next and final slide on housing for health but I wanna take a minute to say briefly something about CARES Court. Our CAO Carlos Palacios mentioned this as a potential unfunded mandate in his presentation. To me, this is an anticipated example of the pressures and emotions and I would say drama that surrounds what to do in California with people who have severe mental health and substance use issues who are in encampments and homeless and the challenge of getting into services. So I give a lot of credit to our governor for prioritizing this. Some people say this is probably his top administrative priority. The complexity of this moving forward and the cost that will land on county government if not funded by state legislature is a serious issue that we hope will resolve through the state legislature in the next couple of weeks. And if not, we were gonna have to have a lot of conversation in California and this may likely end up in courts because of advocates watching this and concerned about how it's being pushed through and implemented. And if the clerk can help me, this ring is not working now. Okay, this is the last slide on housing for health and if I can really ask for people's attention on this, this really in a picture of a budget tells an important story. It's one I did not know what the answer would be but I really asked to see if we could look at this. So if you look on the left slide, on the bottom, it shows in the human services department budget minus the housing for health budget. What percent of our budget is ongoing revenue? Basically we can predict for years ahead with adjustments to the allocations each year based on federal and state actions. What is predictable ongoing revenue? 99 and a half percent of the human services department budget is predictable ongoing revenue with just a half a percent. That is a few grants that we have in our budget with the term that expire. If you look at the housing for health division, it's the opposite. 95 plus percent of our budget is one time state and federal grants meaning less than 5% is predictable money and that is the city jurisdictional contributions from their general fund, our general fund measure G a few things that this community has prioritized. To plan for a long-term intervention for an issue that's been 30, 40 years in the making with no predictability of whether or not this federal and state money is gonna carry forward in the next one, two, three years is very, very difficult to make long-term plans. If you look at the right slide, this is a similar comparison that highlights the amount of staff we have to run the human services department and get services to the community and how much staff we have in the housing for health division. The analogy I wanna use, which is I'm intended to sort of provoke a picture is I think about the times when there has been a country that has suffering with poverty and with hunger and the world steps up and donates a lot of money and then you see pictures of large amounts of food sitting on a dock, but there's nobody to move that food to that community who's starving. So that's a provocative example, but it's a point to make. We do not have the infrastructure and housing for health, nor does any county housing for health-like division having the staff to get that food to the community, to get those grants out the door, to turn around our work. So this just gives you an example. Human services departments have been 50 years in the making and you can see that of our $144 million revenue received, we have about 549 staff to help get that money to the community about half of our budgeted staff. And if you look at housing for health, about 11% of our budgeted staff, and this will only grow if we get more home key awards. So I wanted to highlight that because there is an understandable demand that every penny we get go to services, but if we don't have enough staff, we can't turn those services around to the community. And this is just to highlight why we have in our budget a request for a number of additional staff in the human services department to help have that infrastructure to move the services. It worked. Okay, so this is actually the second to last slide. Thank you for your patience. I hope that was helpful. It's a lot that we're doing. So this is now to end with the good news that despite all the challenges, the staff vacancy rates, the challenges of the last two years, we have 13 objectives in our operational plan. All of them are in various stages of completion, but I want to highlight the four that are completed. And the first two is a moment I want to take to thank the human services department staff. At the beginning, I said, thank you to the budget office, but those 550 staff are the people who are the face of what we do. Kimberly as the deputy and me as the director are our face in moments like this publicly, but we are not the people who achieve the mission and the motto of our department to make a difference. And that's our benefit reps answering the call center, our clerks in a lobby greeting somebody, our child welfare and in homes of supportive services and adult protective services staff who are going in the field helping families and people in a difficult moment. And so I just want to highlight, this is a picture in COVID, Aptos Park, we had a celebration of our mentorship program investing in supporting our staff. We're all mentored by human services staff to who are interested in promoting and learning. And we achieved the operational plan objective of keeping this program going and we have it going again as we speak. And the next one is this was very pleasant news. We do a lot of work in our department to get feedback from our staff to give us a report card, how we're doing his management and we got a much appreciated feedback that staff feel they're getting really excellent supervision from their manager and human services. And that was one of our operational plan objectives. So that's really great news and thank you to the human services department staff who really are the people who helped this community. The last two are an example of housing for health efforts and things that get missed in the mix of housing for health work. We have an operational plan objective to expand the amount of permanent support of housing in our community. And we actually, thanks to the vouchers of the housing authority have been able to expand those slots by significant amounts. But that leads to the last one which deserves public comment and scrutiny which is having a voucher alone does not mean there's housing available in this very tight market. So I do wanna highlight that though this is a modest gain I think it is meaningful and gives us a window to we actually can help me move people from shelter to housing if we have the right formula. And we do to that housing wave effort in this incredibly tight market in Santa Cruz County have moved 134 family units who are in the COVID shelter system into permanent housing. And I think that's quite a success and we have a lot more work to do. And I know it doesn't look that way to the community when you see the challenges but it is still, it would have been worse if we didn't have those successes. So I now close out my presentation. The items on the right are hyperlinks and the public materials where you can go a little deeper into the bundle of information that's in front of your board but in summary request that your board approve the budget as submitted to your board. And thank you. Again, we look forward to question and answer if you have any. Thank you, Director Morris. Are there questions or comments from members of the board? Mr. MacPherson. Yeah, Mr. Chair, thank you. And the breadth of really of the services that Human Services Department provides is really incredible. And the past few years have, it's become more impressive than ever as we stood up for shelters or for shelters up for the most vulnerable during a pandemic and established in the new office of housing for health under Dr. Ratner. Specifically, I want to thank Housing for Health and the team for its leadership in securing that funding for our project home key projects around the county. It was a great event up at the Vets Village in Ben Lohman last weekend. A couple of questions that I have one regarding, and you may have, well, and I also want to say as a board member of first five I want to thank them for their cooperative effort with the implementation of Thrive by Three and getting that all together. It's really very impressive and it's been very successful too. So I appreciate that. The issue of funding for the public guardian will these improved services be available to all seniors and families with children or is it just for those receiving protective services and those under the public guardians care? Yeah, so I actually feel like I've had this program for nine years in my former physician so I have more familiarity with the program. I want to break down the public guardian office actually has two very different programs based on two very different sets of regulations. So I may answer that based on the two very different programs. So one is mental health courts which was based on three state legislators and the sixties Lanterman Petrus short referred to as LPS and that is when somebody who has a serious mental health issue and they are psychiatrically hospitalized and it's been determined by a professional that they might need to temporarily have a conservator make decisions for them. Most often for their healthcare needs and most often for their psychiatric medicine. A process plays out which plays out in a court with due process by that law LPS law back in the sixties and it's been a subject of great legislative debate whether or not that needs to be adjusted. So that program is very specific. It's through a court of law and it is managed with checks and balances by everybody having an attorney and ultimately a judge making a decision. And if that judge makes the decision to temporarily conserve somebody then the public guardian staff take that case and then they are involved for the length of that case and most LPS mental health cases are short term like six months to a year and ideally if the person is benefiting from the intervention of the public guardian's office but with recognition to the behavioral health division of health a lot of services from behavioral health as well then the conservatorship is removed when they're able to sort of make decisions on their own. So that's that part of the program. The one I believe you're referring to is probate court that's often bundled together under public guardian and that is when you think of older adults maybe having their money exploited by family adult protective services gets called we intervene in a referrals made to the public guardian office. That's a different court. That's the probate court and the same process plays out which is to determine if that older adult usually because they have cognitive decline is no longer able to care for their assets make their own decisions and that a court process plays out. What I will tell you and this is a much longer conversation and if this board wants to have a study session in the future I think would be very helpful to talk about this in more detail. That is an absolute unfunded mandate by the state of California. There is really no funding for that program and there is an act of legislation in front of the state legislature to fund that program more. And so it is a very underfunded program and Santa Cruz County like many counties really struggle to resource that program and lack of adequate staffing is a point of great frustration. I want to disclose to you Supervisor McPherson I actually listened to budget hearings in application for this job and I heard you celebrating the public guardian office adding some positions under Mimi Hall's leadership. So there is still an effort and we need to continue to work on this to expand that program because now to your question it's a very limited program and we would love to double or triple it but we have to find revenue to do so. Yeah, that unfunded mandate issues that's a problem but a couple of other things that I hear on occasion that this county gives more in general assistance generally than other counties but to draw more people here, et cetera. I said no, that's not the case. It's kind of said and done what you do provide for general assistance. Is that true basically? So general assistance and Kimberly shared this briefly and her presentation is a state mandate but it is left to the local county to develop the terms and conditions and because it's 100% general fund set the general fund budget for it to back into the answer your question because there are no state and federal laws that dictate the rules of general assistance almost every county in California the terms of the general assistance program were determined by a lawsuit because legal advocates have fought very hard because they know it's all up to the county board to don't have general fund and so they sue under the terms and Santa Cruz County's general assistance program is literally based on a lawsuit from the 70s. I learned that when I got here. So I think to get very technical and we could probably talk about this in more detail it is public information what the cash grant award is and how long a person on GA gets to keep their grant. So some counties like the county or worse used to work the cash grant was not for 12 months. It was actually limited and the purpose was to create an incentive for the client to be able to get off the program and become self-sufficient. The exception to that and this is a issue in the lawsuits is if somebody is unemployable because of a disability we try to get them help to get on SSI and not on GA. So we could do a detailed analysis and I think there's a bit of a yes and a no to your answer we do not have a term limit and our cash grant per that lawsuit is tied to the Coworks cash grant and that is higher than some counties. I don't think it's complex. But it's not always the case by any means for sure. And I don't know Kimberly who ran the program when she was the former ABSD director can certainly add more. I can say that Randy says exactly right. It is tied to the Coworks grant levels which have gone up over time and our general assistance caseloads have actually stayed about the same over time as well. Okay, I have one final question. Thank you, Mr. Chair. Can you describe the challenges the workforce development board staff is facing in assisting local businesses and workers go back to the post COVID to a post COVID business or there's some special circumstances or challenges I'm sure there are. We're probably pausing both to look at each other because that's an amazing office under Andy Stone's leadership and they just created the yearly report and I think our CAO mentioned it. I don't have the specific answer but I actually would invite a whole study session on that report. I know Andy and his team go out and do reports throughout the community. But yes, workforce development boards in a broad sense are struggling mightily with the new and changing workforce and the economy in front of us. And but I don't have the specifics at the tip of my tongue to respond. All right, thank you. That's it, thank you. Thank you, Supervisor McPherson. Any other questions or comments from members of the board? Supervisor Caput. Okay, thanks for all you're doing. It's a big responsibility you have but you're doing a great job. Did I hear you correctly? You said two and a half years. How long ago did we meet when you first started? Oh, my tenure. Yes, I started in February of 2020. I was just saying this is my third budget presentation at the two and a half year mark of my tenure. So I started in February and I still remember meeting you and your children at your YMCA in Watsonville. That's when we first met. Well, anyway, it seems like much, much longer than two and a half years. So much has happened. There's an old popular song in England, very old song when the world turns upside down. That seems to be what happened not long after we met when you first started. With the disaster preparedness, of course we had the fires. And I was amazed at how quickly everything seemed to mobilize. It was a chaotic but it finally it got, we were hit by the COVID pandemic and the fires and the homeless situation and everything. I have a bad feeling maybe that this year we're in a very dangerous situation with maybe another fire. So I guess what we learned about two and a half years ago are you think we'll be able to do it a little less chaotic and what I'm asking is, are we more prepared than we were two and a half years ago? Short answer is yes. And I have to say just an unbelievable recognition of our CAO's office, our general services department, everybody in this community including the human service department, it's unbelievable in the context of COVID and what we're all dealing with that everybody stood up and did a pretty impressive job then. And I think under the CAO's leadership and the creation of OR3 under your board's direction we are absolutely better organized. The issue depending on the scope of the issue will be dependent. I just would say one other variable that struck me calling human service department directors who managed fires before COVID is a variable that nobody predicted happened which most of the time when counties deal with a big disaster like that is you call in mutual aid. And California comes to the attention and sends mutual aid. But because we are all in COVID and we're all struggling handling the COVID pandemic and human services department's handling shelter under the COVID, there was no mutual aid to call. So I think that variable hopefully if we get in a position where the state is not under as much crisis in addition to being much better organized I think we hopefully would have more tools to pull from through mutual aid request to help us. Yeah, and maybe a little communication more communication with the Santa Cruz County fairgrounds because that seems to be a staging area for any disaster that seems to hit unexpectedly. So, you know, the homeless situation of course it hasn't gone away but all of a sudden the veterans building in Watsonville and I'm sure the veterans building here in Santa Cruz became filled with homeless people. I don't know if that's all related to the fires and the pandemic, but there seemed to be like temporary sheltering for hundreds of people. 24 hours a day in the, you know, veteran center. Is there a possibility that that can happen again or, you know, how is that interacting with the pandemic, the fires and everything? The homeless problem is a separate problem but we seem to be trying to deal with it all at the same time. I think it's a very astute question and the answer is very complex. My short answer would be if there is a pandemic like situation where the federal and state government really needs for public health reasons to help people be housed to not stop the spread of a virus like happened in pandemic, it's very likely that we'll apply a lot of lessons learned that played out about how to do it and maybe do it better next time. But I think you're right, there's no way to disentangle what happened in the fires that displaced people who had homes, people who were not housed, COVID, the interplay of all those moving parts made it very complicated to tease out what caused what. So I think it's a great question and I think we're still trying to sort of apply lessons learned and figure out how to help us get in a better place than we are today with so many people unhoused. You bet. Well, anyway, thank you very much, all of you. Thank you, Supervisor Caput. Any other questions or comments from members of the board? One technical question for you. So looking at the budget details, it looks like the general fund contribution for this year is about 29 million, where we had only budgeted around 20 million. Is that because FEMA won't return our calls and we've had to pick up some of the extra costs for shelter operations, am I reading that right? I will start and answer the question. We might ask Kimberly or our CAO or Dave to step in. If your question is we budgeted for the FEMA and state match funding to stand up the COVID shelter system based on our best assumptions about what we'd be reimbursed for. And then as we went through the process and we have a consultant who works with FEMA and found out that there were certain costs that would not be reimbursed. We had to scramble and figure out a way to backfill. And you might remember there was a previous board action many months ago to freeze some of the ARPA funds that were purposed to go into the community to do various things that had to be held to backfill that exposure we had because we were going to not get reimbursed, we predicted. So if you can restate your question about the specific number you're looking at but that's the process that played out that we had to really scramble to make sure we didn't end up exposed with no revenue to cover the costs that we'd already incurred. Yeah, I'm looking for the year where you've just come through 2021, 22. We budgeted about 20 million and the actuals are 29. I was just going to add that additionally, some of the revenues were down because of case loads depending upon which budget category you're looking at. And then our general fund, well, then additionally expenditures were, well, due to the IHSS maintenance of effort, we had a higher general fund contribution that was needed to pay those increases. Okay, so also just because of the impacts of the pandemic, people were able to basically take advantage of the services they normally would and that's resulted in lower cases and therefore less revenues. And yeah, in some of the instances, yeah, in some instances that's the case. It was on that out column on the right that some case loads have gone down and sometimes that's positive and sometimes that's not positive because people are eligible, we couldn't get enrolled. Sometimes it's the need wasn't there. There was a lot of state and federal emergency money made available to the community that led to people not needing some of the services. We usually are the safety net. So I think it's a complicated set of actions but if your question is, when you look at that, there were some reductions in revenue that came in on the out column in addition to some increases as I did in my presentation. Okay, thank you. And then I just, I appreciate the slide particularly about housing for health and the one time funding versus ongoing funding as well as the staffing ratios that we have, particularly for that department versus the rest of the human services department. It's very informative and it's very clear why we need that additional program manager position particularly for housing for health. You also talked about rightsizing the engine for the rest of the department and it was additional seven admins and aides that are in the proposed budget for this year. I mean, as you heard during public comment, the idea of adding bureaucracy is never super exciting especially to members of the public. I just wonder if you could tell a little bit more of the human story behind what those, what that additional administrative capacities can allow us to do. Sure, let me break down and answer a couple ways. So first of all, mindful, some of the public comment was about the program we'll talk about next week which is by definition 100% general fund. Those admin physicians are part of the human services budget which is basically by adding a little general fund to draw that 88.5% of federal and state dollars. It's claimable services to run the administration or program. So it's highly leveraged, small investment helps. So that's number one. Number two, I mean, the best way I can kind of make this simple is to go back to that provocative analogy of the food on the dock. If you don't have an analyst working in the contracts unit to have capacity to sort of turn around a scope of work quickly and work with a community-based organization to submit the paperwork and then get that money and get it to the community-based organization provider, our lack of enough administrative staffing directly relates to how hard it is to spend and move the money. So it literally is like using that analogy, hiring a truck and a driver to pick up that food and get it to the community. So that's the human element of some of that story. If we do not have enough accountants in the finance office, given the complexity of the budget and we get audited and we get disallowed the money that we've been spending because we didn't have our book set, that is less money to get to the community. So it's really based on the decades of human services financing. There's formulas that help determine how to make sure you have enough infrastructure to make sure the money is being moved, getting to the community quickly. And it is our clear assessment from the multiple stressors of Housing for Health and the COVID shelter. We did not have enough bodies to move services into the community. So it is all for the indented purposes of getting services into the community and making sure we have our books straight. Okay, thank you. Any other comments or questions? Seeing none, is there any member of the public that wishes to address us on this item? Anyone on Zoom? We do have one speaker on Zoom. Your microphone is now available. Thank you. Good morning, supervisors and staff, play camp executive director of the seniors counseling area agency on aging. I wanna thank Randy Morris for his mention of several times of master plan for aging and how the county is working with us. We're really excited about that. I think there's great possibilities there. And Randy has been wonderful to partner with. I do have to remind the board that the recent core project is not a good way to start or core process is not a good way to start this partnership is we're seeing $200,000 worth of net reduction to senior programs. So that's not kicking things off extremely well. And among those things are nursing home prevention or nursing home protection and suicide prevention which seems kind of extreme areas to cut. I know the pulling the threat analogy if you relook at the funding process that messes the process up. But I think results especially when we're talking about saving lives are probably more important than process and there's already some problems. We know senior network services had a project that scored at 86 funded and another project that scored 87 not funded with apparently the only criteria being that the 87 pointer asked for more money than the 86 pointer funded. So as part of this, I just wanna close by reminding the board that equity or that aging is very much an equity issue. And one of the big challenges we face and I think this process is an example. Maybe the thing that sticks out the most to me is a $770,000 special project that takes away from some of these other programs yet it's equity focus and the agency providing this exclude seniors from their services or from their equity project. So if we're really going to embrace master plan for aging let's start by recognizing that aging is an equity issue indeed. Thank you. Thank you, Mr. Kempf. We have no further speakers chair. All right, then I'll return to the board for action. Move the recommended actions. I'll second. Second. Motion by Supervisor McPherson, second by Supervisor Friend. Any further discussion? Seeing none, clerk roll call vote please. Supervisor Friend. Aye. Coonerty. Aye. Abbott. Aye. McPherson. Aye. Seidem passes unanimously. Thank you to the whole entire human services team for the in-depth presentation. Do we have health services on deck? Okay, then we'll proceed with item eight to consider approval of the 2022-23 proposed budget for the health services agency including any supplemental materials and take related actions as outlined in the reference budget documents as recommended by the County Administrative Officer. Are they, I don't know if they're coming in on Zoom or are we waiting for them to, oh. They should be joining us. Well, we'll dive into health services now and to kick us off I'll welcome our health services director Monica Morales. Thank you. Thank you, board. I know you guys have had a long morning so I'll try to get assisting presentation in front of you. I wanted to back up a little bit and just share with you, I'm sorry just a minute. How do I back this presentation? There we go, thank you so much. Wanted to just share with you just provide you with a high level update on our proposed budget for fiscal year 22-23. As you will see the budget in front of you really presents the community need that the health services agency is really trying to meet. So with that, I do want to take an opportunity to introduce our team. We have a very, I think, dedicated team here with you that you have worked with over the years that will be presenting the information to you as well. I have brought the director of administrative services, Jessica, with me, Randolph. In addition, we have, as you know, assistant director Jennifer Herrera who will also be co-presenting with me. And I'm privileged to say that we have a full team also online via Zoom ready to answer any of your specific questions that you might have. So why don't we go ahead and move forward. I wanted to also really emphasize that the team that has put together this budget has been working for months just really trying to connect the need of our community where our priorities are. And it really takes a robust team to present and get all these documents ready for you. But I hope for me that it's what you requested and we answer all the questions that you have pertaining to our priorities. What you see in front of you is an organizational chart that really outlines a strong team to kind of manage all of the demands that we have as an organization. We have two assistant directors, our director of admin in our key divisions, our division of behavioral health, clinical services, environmental health and public health. And so this mighty team really is responsible for running our shop with about 750 staff, as you'll see in our budget that we will get into more detail all really with an effort to build healthy and resilient communities in Santa Cruz County. So, try to, part of our effort is to really try to address, there we go, a lot of the social determinants or community drivers in our community or economy as you all know, continues to be very unstable. Housing is still unreachable for many of our community members. And there's just a very uncertain environment that we're going through right now. As you know, we have unprecedented temperatures today and tomorrow in our county. And so a lot of this for us really means that the mental health, the social health of individuals is at a very significant health impact and wellness affecting our community. COVID continues to be present. And so as an agency, what we deal with on a daily basis are the local impacts of homelessness, of mental health, thinking about our environment, conservation and safety of water, chronic diseases and substance misuse. And so for us to reflect on the fact that for example, suicide is the fourth leading cause of death in our county. Overdose is the eighth leading cause of death in our county. And diseases such as diabetes and heart disease continue to impact the wellbeing of our community members at really high rates. And so for us as an agency, our budget really reflects the needs that we need to organize and have a workforce ready and prepared to deal with. It's not an easy feat as you can imagine, but it also requires us to have common priorities as an organization, as we're dealing with these very serious health issues in our community. We have six priorities in front of you that you'll see our budget really aligns with in terms of continuing our work around equity, very little resources, but we need to target and be wise about reaching those that are most in need, thinking about how do we take advantage of a lot of the Medi-Cal opportunities through a lot of the federal and local state programs like CalLame to increase reimbursement, bring in more money at the same time, build our infrastructure that we need in terms of contracts and staffing. As we know, we depend a lot on our economy as well on key workforce. And so taking advantage of the fact that Medi-Cal has now expanded to folks that are undocumented in our state. And the partnerships for us, I would say, one of the big, I'm very proud of this county, part of it's because I was raised here, but a lot of it has to do with how active and the strong leadership that we have in our county. And that's really through the strong partnerships that we value and we want to continue to expand upon. And so that's another priority for us. We can have a service, but if we don't have the infrastructure, then that really defeats our work. And we're facing that with behavioral health. We're facing that with some of their clinical work where we don't have the facilities. And so again, scaling and retaining some of our current facilities, such as the Watsonville Community Hospital and scaling for behavioral health are key efforts for us. I'll jump into the data integration. We are swimming in data. And the issue is can we make any actual sense or provide concise reports for you that show targeted efforts, the impact. And so data integration and moving us from antiquated systems and new models is really an effort for us to bring us up to the 21st century. Finally, we've had discussions about workforce. So this is a key priority for us. We'll dive into it a little bit more. So in summary, what I'm hoping is that you'll see our investments, our priorities in our budget really reflecting some of the policy priorities, programming priorities to meet the need of the determinants that are driving a lot of the wellness and health impacts of our community. Let me walk you now through our webpage for the Health Services Agency where you'll be able and our community members will be able to actually track a lot of what I will be presenting today. So in that show, I actually wanna also give you kudos because you made an effort to be transparent about our budgets and funding. And I can't count a county right now probably less than probably five that have done this. So we're very proud of the fact that you now have a budget really data for our public to know exactly what's going on. And so this is something that I've shared with my state colleagues and they're all very shocked at the fact that this small county such as ours has made such a remarkable investment to be transparent with the dollars that are coming in. So again, you know about our mission statement where I wanna highlight more is really around towards the bottom of the screen, the website highlights our total expenses. So right now Health Services Agency our expenses are about $203 million. The revenue we're bringing in those you can tell is quite robust about 95% of our budgets based on grants we ride some of the medical reimbursement we're taking advantage of some of the fees. So that's at $225 million and change. We've been pretty steady with general fund that right now is about $12 million. So you'll see over the years when we show you some of the trends that it's been pretty steady. And then in terms of our staffing levels you'll see that we are increasing all of these numbers really demonstrate our hard work to writing grants. And as I mentioned, just bringing in some revenue into a program. So that also means that our staffing levels are increasing we're proposing 752 staff for this fiscal year coming. But let's focus a little bit now on what you can find on the site. So what you'll see is that you can actually go through our different divisions and click on some of the services that we offer and this case will focus on the Watsonville Community Clinic. You can click on the right side and you get a nice paragraph on what that service is some of the emerging issues. So I won't spend a lot of time with you highlighting this you can find it on the website. And I hope our public can also find it on the website. Another nice functionality is that you can actually see our budget as a whole the total for our entire agency. You can then even look at individually by division and this is one of my favorite you can see some of the trend lines over the past two years, three years. And this will get developed as we move as you know, we're launching the website. So I'm hoping that as we get more questions we can really share with our public that they can go onto the site and look at trend lines specifically for some of our divisions. Moving on, let's touch a little bit on the data you can find for a personnel. Again, you can get down into not only the total staffing levels you can click by division it will tell you how many staffing by each division it will tell you their classifications it will tell you the number of staff. So again, a very robust website for those that are wondering what exactly is taking place at HSA? So very proud and I really think all of the folks that have worked from our shop to make these numbers appear here on our site. Again, we're still working on some glitches but overall you can get a very nice summary of what we have back to the budget details. So for those that are really wanting to dive in into some of the expenditure categories you can again get it for the as a total for the department you can break it down for divisions on this case we'll go to clinics you see our expenditures by category you see the revenues by category and the fund contributions as well. So very much a fully transparent in terms of practically every dollar that's coming in you'll see reflected on the site. So with that, I think what you're noticing from the website is that it's really our effort to continue to provide really important care really important services in our community. We'll see some changes taking place in our supplemental pertaining to KELIM because that work is really, we're right at the start of it we anticipate KELIM continue to increase both revenues but also the work in our staffing levels. You'll see too that we still have a lot of work around our clinical revenue programs such as healing the streets are increasing. We also anticipate state immunization funds to increase as part of the COVID effort and you'll see some changes dropping in terms of our public guardian we're transferring that to HSA our sister department and FEMA reimbursement you've heard a little bit about that as well we see that decreasing. So all of these key changes are really impacting our proposed staffing levels our expenses and our overall revenue. So again, trying to think about what are the priorities for us for 22-23 in terms of our budget? We really do see our efforts as I mentioned earlier we're establishing the Office of Health Equity through a grant by the Department of Public Health that work is really gonna help us shepherd existing efforts around equity but really trying to do more implementation across our agency. We're working with the CEO's office to help with care justice helping with facilitation and resources around equity. And when it comes to health access we are partnering with the CEO's office and other community organizations to make sure that the Watsonville Community Hospital stays open that's been an effort that's working on the transaction but also thinking about future service lines such as behavioral health establishing a foundation for the hospital and providing the administrative support for the health district. I know that Randy already covered CalLame for us really it's gonna be and continues to be a great effort over the next 24 months thinking about expanding for example behavioral health services now that we have other social and case management opportunities that are reimbursable we really have to maximize our activity internally to ensure that our community is being served with these new opportunities of care. We've presented to you the last staff consent report on our behavioral health work really needing to expand services as you know as it pertains to our psychiatric care specifically thinking about residential and mobile behavioral health services we've talked a little bit about the adult behavioral health services and children and youth behavioral services so all of that is part of the budget and what you'll find there. As we mentioned trying to think about preventing overdose so the medication assistant treatment efforts continue to be important for us as well and you'll see that specifically in our budget. Thinking too about our community partnerships part of that for us is through the contracting that we do but also for specific efforts to ensure that some sections of our community are really moving forward to address some of the behavioral health or public health efforts that we have pertaining to chronic diseases also behavioral health and so forth. So partnerships continue to be a key component for us in our budget through our contracting. I'll focus a little bit on our infrastructure this is an important priority for us as you've heard us present on the Freedom Campus right now we just finished really a phase where we obtained a lot of community impact we had virtual town halls as both in Spanish and in English asking for what they wanted to see on that campus we're also trying to leverage grants to expand some of our behavioral health services there and right now we're going through the environmental review process that we're hoping will be finalized by the end of the year. So again, thinking about the infrastructure pieces that we discussed with you earlier and prepping and having resources available for that's going to be key for us in the next coming year. We don't get to talk a lot about the safety and the reliability of our water in the county but this is something that's a big priority for us moving forward we need to think about the safety of our water plan for droughts and also look at our septic systems because in this county it's a very unique circumstance that we have here so that's going to be a priority for environmental health division. And I'll focus a little bit on workforce you heard me talk already about the data pieces but really thinking about how do we retain our staff as many of you guys are aware we had a strong team lead us through the COVID pandemic and now unfortunately not only do they have to still continue with COVID we now have to address all the aftermath of COVID the anxiety levels that we're seeing in our youth the lack of clinical care that folks have postponed and now we need to get them into care in addition we need to continue our training education of our staff so it's a huge investment for us that we're doing as well. And I'll talk a little bit about the state and federal opportunities I'll highlight a few since you've heard already my colleague Randy discuss some of these. I'll focus a little bit on what we're noticing for the workforce there's still investments that are coming from different departments at the state level to continue our work in public health for example there's also thinking about not only bringing in staff but getting youth at a young age committed or interested in health and so we have pipeline efforts taking place that are being considered. I'll talk a little bit that we're still uncertain on what's gonna happen with the Children's Health and Disabilities Program we know it's supposed to sunset next year so we're monitoring that. Randy covered care court so I don't wanna spend too much time all to say is that we see as an impact in our behavioral health works and this is gonna be an unfunded mandate for behavioral health at this point. And finally the DHCS and Kaiser contract we know that that's gonna impact the medical market in Santa Cruz we have to think about the overall impact as well to our clinics think about with another vendor in place how do we ensure that the safety net is stronger and not necessarily weaker and what does it mean for the rest of the health systems providing care to the medical population? So all of this for us are emerging issues that we're gonna be tracking for you and reporting to you as the months approach. So we can't present our budget without talking about COVID COVID is here to stay as many of you have heard we know that our work will still really revolve around messaging and mitigation strategies promoting those in our community making sure that we're still distributing some of the resources like testing kits therapeutics and PPE we are trying to work with the health systems to make sure that they're also planning and building that infrastructure for COVID and their facilities in terms of funding we know that funding will remain stable or decreasing we've been monitoring the federal level world excuse me budget for COVID and also the state level so there's some increases but then there's some definitely decreases we won't see the same funding that came in 2021 so it's something that we have to think in our planning for. So in conclusion you know for us that's in a nutshell the budget wanna thank all our staff that were instrumental in preparing all these documents for you I'm here now with my team to answer any questions and really make a recommendation to you to approve our proposed 2223 budget for HSA. Thank you. Thank you, Director Morales questions or comments from members of the board. That's right, here I am again but no questions as much as there are comments I just wanna thank you Ms. Morales and Sven Stafford for our new health services director for taking the reins of our largest department with more than 750 positions and I also think we need to mention the former health services director Mimi Hall who left us but still stayed much engaged in seeing that we can our Watsonville community hospital survives and we've got some critical deadlines ahead of us on that as our CAO Carlos Palacios mentioned and much of what we do in this area of course is reflection of state and federal mandates I think it's 90, 95% as you said and we I wanna say that we appreciate every dollar and sent you give us federal and state governments but that phrase of unfunded mandates is not much appreciated and we see that some of it may be coming especially with the care court. I really wanna highlight the increased investments in our behavioral health programs as I've mentioned in the last several board meetings as grant programs have come to us for approval very much needed and appreciated and I also wanted to acknowledge the diligent work of the public health division related to our COVID response. The nature of this work really has changed over time but it's not gone away with us for a while as you mentioned and the long-term impacts especially to some of our younger residents here in Santa Cruz County we don't it's gonna might have a significant impact in the future and specifically for in my district the fifth district to thank you for the to the environmental health division for its work and my office on the California or County service area seven fiery fire expansion project that will benefit rebuilders reduce environmental protection or really enhance our environment I said protection pollution that's gonna be critical that we put that in place and really to support the businesses in the North County and Boulder Creek but that benefit of the rebuilders and reduce environmental pollution is critical and it's a win-win situation for us so I'm really glad to see that in place and carry forward with that. So thank you for everything you're doing there and a very complicated and demanding department each and every one of you have had and thank each and every one of your employees for what they have done for this County. Thank you. Thank you Supervisor McPherson. Okay. Supervisor Caput. Yeah, you've had the world turned upside down like I mentioned at the last, for the last two years, right? Everything just hit all at once. I'm just curious on the cooperation when you were doing all your work with health services there has to be a lot of cooperation between your department and human services and also probably general services, is that correct? Can you kind of just briefly explain how you had to put everything together and cooperate because I think it was remarkable how when we got hit by everything at the same time where all of you did an outstanding job. Thank you. I'll start and now let our assistant director Jen follow because I think you're asking specific about some of our COVID efforts prior to me being here but I do have Randy on my speed dial is we talk often and it's part of that effort for us that as a cohesive County system we need to be there for each other. This for me the way that this County addressed COVID at least when I was at the state at the Department of Public Health we heard the amazing work that they were doing not just within the County but also working for example with the community based organizations. I'll now pass it to Jen and she can add a little bit more detail of what it was like here when you guys were in the response. Well I think I'll just add that it is one of the strengths of our agency is that there is no ego involved it was just a lot of collaboration all hands on deck in order to implement mass vaccination clinics during the vaccine rollout and just create strong partnerships across GSD human services and health services. So I think one thing that is clear after this pandemic there's been so much trauma just within our agency and within the community but one thing that is clear is that I think we are coming out stronger as a system because of the strong partnerships that have been developed. Okay and the general public I just wanted to say what I've noticed in the years that I've been on the Board of Supervisors is the incredible knowledge and expertise that all the departments and all the people that work for the County Government when you put it all together it's just an amazing amount of great service that is being done with our budget in ways it's taxpayer money they like to know where it goes well where it goes is outstanding people like you and all the other departments and I'm sure Carlos can back me up on that he overlooks the whole thing so thank you individually but also thanks to all the people that work for you thank you thank you Supervisor Caput any other questions or comments from Board members Mr. Chair I'll make a brief comment thank you Director Morales for your presentation and I just wanted one of the things that I believe is a reoccurring theme in particular in your department as well as in the human services department is just how fragile the system really is in particular the safety net system on the health side for people within our community as we've seen with Watsonville Hospital for example if Watsonville Hospital is unable to be successfully maintained in the long term in public ownership they would have catastrophic effects on the overall service delivery in the community but disproportionately for disadvantaged communities as we're seeing with the challenges on the county organized health system model right now in particular some state legislation challenging that for the alliance and other programs throughout the state that people rely on for health care or health insurance and therefore health care also exceptionally fragile and in particular when your department was faced with you know one of the greatest challenges of our lifetime the greatest pandemic of our lifetime currently it just goes to show how quickly it can be overtaxed it doesn't mean that people didn't rise to the occasion in fact people did heroic work but it just goes to show that it's a really thin line between the net that we've built and pretty adverse outcomes and one of the things that I'm concerned about is in particular with the economic model shifting with an unprecedented amount of state and federal funding coming in that's not long term sustainable and the net itself frame that those responsibilities on your department and human services are going to continue to be there at an extended level without the resources necessary this is a very responsible budget that both you and Director Morris have presented and in fact actually show some growth in areas needed including the transition from some temporary positions to permanent positions but I'm just saying that overall any one of these things I just mentioned if they are not able to be stabilized would have catastrophic effects on the overall health system delivery here and a lot of that's going to fall back on your department and the human services department so I believe before the pandemic started there was a lot of questions about what the county did in some respect people may have recognized the standard service delivery model but now it's been highlighted in a way across the country it never has before and disproportionately in your world so I just want you to know that this board really appreciates you your team those that came before you Paul did unbelievable work obviously Dr. Newell, Dr. Goh Ducci and others but then we also know that it's going to take ongoing continued investment and advocacy in particular at the state and federal level to ensure that you have a stable system because I just think that the overall health system here is very in a very precarious state and those that get hurt the first are those that need the services the most but I just appreciate you and your team for that and anything that the board can continue to do outside of what we're doing today to help stabilize that please continue to lean on us for that thank you Director Moss Thank you Supervisor Friend Supervisor Friend alluded to this which is the dependability of state and federal funding I mean with that the human services budget it's 88% funded by state and federal funding I mean with health services even more so right 95% really and I mean it's fantastic that in this year's budget we're expanding with 21 new full-time positions is it going to be sustainable? how dependable are these sources of state and federal monies and of course state even more so than federal you know just looking at the bear market this year knowing how dependent our state is on capital gains, taxes for much of its revenues are we going to be able to maintain these 21 positions moving into the future what's our contingency plan if we don't get that money from the state? couple thoughts so my first thought is that I didn't have that slide and I'll make sure you guys get it but there is a slide that highlights the difference in terms of what it's coming in through our reimbursement models and so we are actually increasing a lot of the Medicare reimbursement that we're getting in the department so you'll see that reflected on that slide I'll make sure that you see that we anticipate that that's just going to continue to grow as the state expands the ability to reimburse for other type of services like case management or before we weren't able to think about transportation we weren't able to serve just as involved populations with those changes the increase of reimbursement you'll see that in our budget reflected so we could have a whole discussion I think in the future of what we're noticing what we're planning for through CalAIM as well as other community support services the other pieces that I think federally if we follow the discussions we know chronic diseases are not going away we know as well that we have a senior population really exploding in our nation and they're already making projections for what that's going to look like in our community and the investments that we'll have to think about so I think the grant dollars what happens is priorities do shift but the need doesn't right and so we as a county and as a department need to plan and monitor the national and state changes or we just honestly what you'll see is you shift staff around and so it's not that you know we're going to we haven't for the past 10 years that I'm aware have had to come necessarily to say you know bail us out quote unquote rather our staff know they're going to participate the change they're writing grants daily on this okay maybe not daily maybe weekly and we then shift as needed because our communities need shift we have to be poised to shift and that's what you'll see in our budget reflected okay thank you so you think that we'll be able to maintain this level of staffing that because we'll actually be providing services and that will be essentially these positions will become self-sustaining or self-supporting for our projections yes and what you'll see more of and you probably saw a little glimpse of it is that some of our positions for example it seems like they're on new but in reality we're changing limited term positions that we've had into like permanent positions because we have grand dollars or we have reimbursement that's coming in through some of our medical programs or some fee reimbursement that we're getting in as well so that's a little bit of what we're doing the other thing about is coming from the state we mandates are in staffing levels in our grants so you'll see that reflected sometimes our tobacco program for example is moving in that model we know some of our behavioral health programs are moving in those models so it's just part of the mandate at times and it's part of what we also need to think through as we're building these reimbursement mechanisms for the department thank you one further question is how is the process of actually hiring for these positions going I mean I know we're doing everything we can to increase the pay for our nurses and doctors and that's one essential step just to reach parity with some of our neighboring counties but there's still a lot of competition from the private sector as well and we saw with the budget managers presentation a 6% decrease in labor force participation over the last seven years and of course the huge increase in housing costs we can be able to fill these positions that's a great point you're bringing and I think that's what we added for us as a strategy and a priority for us there's a couple of things you have to find people that are willing to really put community first in our world because the work that we do is very intense I mean you just have to look out the window to notice the tense and we're part of that effort and everybody wants to do that or is equipped to do that so it's a special type of dedicated individual that's committed to health outcomes and that in itself takes some time I also think we're trying our best to have a national and state strategy and a local strategy on building a pipeline historically you heard about public health and what's public health what do they do it's kind of what you were mentioning and I think now folks have a good idea of the work but we need to get better at communicating the impacts that we're doing and I think that's a strategy that we have we're trying to also work with personnel and our team internally on how we get more innovative to do more recruitment and outreach and the other strategy that folks are talking about is how do we take our own community to motivate them to also think about health as a potential career for them so multiple strategies it really is going to take our academic institutions such as UCSC and Cabrillo to think about even bringing in degrees or programs that address health expanding those it's going to take us working with the high schools so those are all plans I'm sure you guys have heard it's a it's a multi-prong approach that hopefully will be able to tackle systemically thank you there are no further comments or questions from members of the board are there any members of the public that wish to comment on this item I have no one here in chamber is there anyone who has on Zoom we have no speakers on Zoom chair I can all return to the board for action I'll move to approve recommended action I'll second with just a brief note that I appreciate both HSA and HSD's efforts to both respond to these federal and state mandates that feel a little bit piecemeal and reactive or a lot piecemeal and reactive as well as make sure that we take the parts that we are in control of and be as preventative outcome driven and transparent as we possibly can and it shows in both their presentations and in their budget priorities this year thank you supervisor Coonerty we had a motion by supervisor Caput and second by supervisor McPherson any further discussion seeing none clerk roll call vote please supervisor friend Coonerty Caput McPherson and Koenig signed and passed unanimously thank you the 2223 budget for health services agency being approved thank you to the entire HSA team for being present today I just also want to thank Sven for helping me prep for this we will now recess the budget hearings will continue tomorrow morning at 9 a.m. as we get into land use the board will have a special meeting at 1 30 p.m. today to discuss to consider the approval of our grant anticipation notes by the Santa Cruz County capital financing authority in order to provide interim financing for the Pajaro Valley health care district again we will be recessed now until budget hearings tomorrow morning with a special meeting this afternoon at 1 30 thank you