At their annual budget hearing on June 6, the Board of Supes unanimously ok’d the 2023-24 budget mostly by utilizing over $7 million in one-time funds.
Ted Williams, of the Coast’s 5th District, capsulized this year’s budget process, explaining, “Mendocino County has a footprint that is beyond its revenue, and this may be a good time to have a re-set in staffing, vehicles, facilities, health plan, everything, because we are not on a track that’s sustainable. We can kick it down the road one more year, and I think that’s what we’re doing with the seven million dollars in one-time funds. When I ask the hard questions (to the CEO and finance staff) and look at the (financial) printouts, I don’t see where the County has much money to its name.”
Williams was speaking Finance 101 reality. When you’re broke, there’s only two options available: increase revenues or cut expenses (including selling off non-performing assets).
Recently, Board Chair Glenn McGourty commenting on the unsettled state of fiscal matters, pithily summed up the County’s situation, “If you don’t know how much money you have in the bank, it’s difficult to do your business.”
John Redding, a former member of the Mendocino Coast Health Care District (MCHCD) Board of Directors, offered these insights on current budget woes:
“Using the financial data provided by the County’s website, a few things stand out. First, the cost of General Government (management, Supervisors, lawyers, etc.) has increased at a startling rate and has that hockey stick appearance. It is now 4x the amount spent on roads. Sheriff’s costs have not gone up nearly as fast. Second, look at the County’s sources of revenues and you will discover that 50% of it comes from federal and state aid. Which is too much dependency since a lot of that aid depends on the politics of the day. Meanwhile, County revenues in the form of sales and property taxes have stagnated and the long hoped for cannabis revenues never took off. I have said that the problem with the County’s financial predicament is the declining state of our local economy. With each passing day and another round of regulations, businesses find it harder to stay in business not just in Mendocino but throughout the state. Also, an inability to address the housing issue has exacerbated this problem by creating a worker shortage. The dire state of affairs in which we find ourselves begins first and foremost with those elected to represent us developing a sense of urgency about the problem.”
In a memo to the BOS captioned “Economic Development in the 2023-2024 Budget,” Supe John Haschak proposed re-directing $300,000 of the one-time funds so “we can meet the challenges of economic development in Mendocino County by supporting programs that have been proven successful and we will be positioned to take advantage of the opportunities ahead.”
Haschak proposed funding Visit Mendocino at $150,000 instead of the original $262,000 decided for the tourism organization, and allocate another $150,000 for economic development. Visit Mendocino claimed that for every “one dollar of county investment, 62 dollars are returned” to the local economy. Haschak pointed to another $12.5 million in “successful grants” related to economic development from a 2022 contract with the West Center. According to Haschak, “They (West Center) have convened the business community both inland and coastal in discussions about ways to meet the needs in MC and have created a campaign to ignite investment in Mendocino County. Additionally, West Center provides programs to strengthen our innovative startups (StartUp Mendocino) and our Hispanic Businesses (Centro Latino West).”
The Supes approved Haschak’s proposal, thus balancing the 2023-24 spending plan, but little of what they did goes toward fixing structural defects in County finances, which includes the budgeting process.
More Weed in the Ground
On my Saturday KPFN program, I told listeners that it’s apparent to me that weed production is on the rise. I know that to be the case for two reasons.
First of all, growers — these are mostly the mom and pop variety — have told me that after a year or two of fallowed grows, they’re once again tilling the soil.
Secondly, the Laytonville County Water District for the past several weeks has been operating on a peak-demand basis. Remember, you can’t grow weed without water.
I’m told that, depending on the quality, pot is fetching prices ranging from $300 to $900 per pound. Of course, these are black market prices but that’s really the only market that counts.
Hopefully, this trend will continue, since state and local governments have wrecked rural economies by creating unworkable, grossly complex pot laws and regulations.
A year ago marked the exit of most of the outsider, big-monied pot businesses, it also resulted in the current economic crisis visited on long-established local businesses, especially those in the unincorporated areas of this county. Almost all small businesses are hurting, some worse than others as suppliers and vendors demand cash on delivery. The real estate market is saturated with homes and properties abandoned by people who have cut a trail to parts unknown. Newspapers are full of legal notices advertising foreclosure sales on mortgage defaults.
Even though everyone — growers, non-growers, businesses, and local governments — have historically benefitted from “pot dollars,” no one seems to know or have any ideas about what to do about this mess we now find ourselves in.
If not for the state of California subsidizing this county’s failed pot program with a combined $17.5 million in grant funds, the situation would be even worse, if that’s even imaginable.
Naturally, government officials have done nothing other than look the other way, as rural community economies continue to nosedive.
This disastrously botched experiment with pot regulation has run its course because there’s just no place left for it to go.
(Jim Shields is the Mendocino County Observer’s editor and publisher, observer@pacific.net, the long-time district manager of the Laytonville County Water District, and is also chairman of the Laytonville Area Municipal Advisory Council. Listen to his radio program “This and That” every Saturday at noon on KPFN 105.1 FM, also streamed live: http://www.kpfn.org.)
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