Improvements, growth and new possibilities
From our Supervisor
September 15, 2018
Kern County Budget Update
This week, the Board of Supervisors passed the county's budget for the 2018-19 fiscal year. We are in year three of our four-year plan to eliminate the General Fund structural deficit, after several years of falling oil prices and rising employee benefit costs. All county departments, except for Kern County Fire, have endured cuts during our four-year plan, but the Board and I have asked your county government to maintain service levels despite these cuts. The efforts of every county department head and employee to find cost savings, and do more with less, has resulted in a reduction of the structural deficit from $44.5 million to $18.8 million this year. I am very proud of our county workforce.
Continuing the Board of Supervisors' commitment to prioritizing public safety, the Sheriff Department and Fire Department will see no cuts in this year's budget.
On a positive note, this year we anticipate higher property tax revenues due largely to the increased price of a barrel of oil. Overall, property tax revenues are expected to rise 3.5 percent, which equates to a $7 million increase to the General Fund. Even with this increase, we still need to remain vigilant with our budget reduction plan, as employee pension costs continue to increase dramatically. In fact, pension costs for the county have increased approximately 70 percent over the last 10 years.
In addition, it is still very challenging to erase the deficit in the County Fire Fund. Once again, pension costs for the Fire Department are largely to blame for those challenges. Of the county's overall $18 million deficit, the Fire Fund accounts for $7.5 million of it. The Board is committed to providing support to the Fire Department to solve this problem, and ensure it is fiscally secure.
Advance Kern Business Recruiting Website
The anchors of Kern County's economy have been aerospace, agriculture, military installations and oil for decades. The need to diversify Kern's economy is apparent every time there is a down turn in those industries. To that end, the County of Kern and the Kern County Economic Development Corporation have launched a new website called "Advance Kern" (www.advancekern.com) where prospective businesses wishing to build new sites or relocate to Kern County can go to view what economic and tax incentives are available. The website features a unique "calculator" tool that prospective businesses can use to enter in their desired footprint and the number of jobs they plan to create locally. This information is used to generate an estimated figure on the level of incentives the county is willing to negotiate. All incentives and proposals are subject to approval by the Board of Supervisors.
The opportunity this new Advance Kern website brings to us is exciting, and, in recent weeks, L'Oreal, USA, Inc. has used these tools, and will be locating within Kern County soon, bringing 155 new jobs.
Each new job created by a business that sets up shop in Kern County has a multiplier effect that ripples down throughout the rest of Kern's economy. All incentives given by the county to businesses are in the form of a tax rebate, but only after all property taxes are collected up front.
As an example of the multiplier effect 100 new jobs created in Kern means our economy can expect $7.4 million in residential real estate transactions, $1.4 million in auto purchases, nearly $1 million spent on recreation, entertainment, and restaurants, $825,000 in clothing/apparel, furniture, and appliance purchases, and $2.4 million spent on other business services.
This website is a way to start the conversation between our county economic development teams and businesses wishing to expand or relocate. We want to entice those businesses that will truly have a transforming impact on our local economy. I am very pleased with the results of this website already.
Amazon Moving into Kern County
Kern County was recently the recipient of some great economic development news! A new, two million-square-foot Amazon Fulfillment Center is coming to Kern County. It will be located near the Meadows Field Airport in unincorporated Kern County, and will initially create up to 1,500 jobs, with room to grow. With each new job created, there is a multiplier effect where other, indirect jobs are also created, bringing more economic growth to the county. I am excited that the county's economic development efforts are working effectively, and our economy is growing and diversifying.
Zack Scrivner is the Supervisor for Kern County's Second District.