To: Board of Supervisors/Directors/Commissioners/Directors of the Sonoma Valley County Sanitation District
Department or Agency Name(s): County Executive’s Office
Staff Name and Phone Number: David Guhin, Peter Bruland, Nikolas Klein, 707-565-2431
Vote Requirement: 4/5th
Supervisorial District(s): Countywide
Title:
Title
Fiscal Year 2026-27 First Quarter Consolidated Budget Adjustments
End
Recommended Action:
Recommended action
A) Adopt a Concurrent Resolution adjusting Fiscal Year 2026-27 budgetary appropriations by $93,528,245 for County departments and Sonoma Water to implement prior board-approved actions, project re-budgets, and technical budgetary corrections. (4/5 Vote)
B) Adopt a Resolution adjusting Fiscal Year 2026-27 budget appropriations by $5,871,183 for the Sonoma Valley County Sanitation District to implement prior year board- approved actions and project re-budgets. (2/3 Vote)
end
Executive Summary:
The recommended actions add combined total appropriations of $99,399,428 to the County’s FY 2026-27 adopted budget, including the Sonoma Valley County Sanitation District, in accordance with prior Board direction or approval. Total adjustments include re-budgeted appropriations of $79,387,489 from the prior fiscal year, and $20,011,939 of new appropriations associated with prior Board direction, grant program true-ups, and technical budget corrections. Re-budgeted appropriations include $5,871,183 for Sonoma Valley County Sanitation District projects and $67,955,617 for other Sonoma Water projects. The First Quarter Consolidated Budget Adjustments increase the County’s total FY 2026-27 gross expenditures to $3.97 billion. Excluding internal transfers and reimbursements, which more accurately reflects the County’s operating and capital expenditures, results in a net budget of $2.89 billion. Refer to Exhibit A of the attached budget resolution for details of requested budget adjustments. This report also provides a status update regarding FEMA reimbursements associated with recent disaster events.
Discussion:
Budget Adjustments
Throughout the fiscal year, County Departments, Agencies, and Districts need to adjust revenue and/or expenditure appropriations in their budgets for activities that have received prior Board direction or approval, re-budget of prior year funds, technical budget adjustments, or to meet other ministerial requirements. The Board’s approved annual spending authority expires at the end of the County’s fiscal year on June 30; therefore, departments often need to re-budget unspent funds from prior fiscal years as part of quarterly adjustments. To facilitate this need, the County utilizes a quarterly Consolidated Budget Adjustments (CBA) process to combine departments’ adjustments into a countywide budget resolution.
A total of 19 departments submitted budgetary adjustments for inclusion in First Quarter Consolidated Budget Adjustments. The proposed adjustments do not include any new programs or initiatives not previously approved by the Board. The proposed adjustments add expenditure appropriations of $99,399,428 to the FY 2026-27 budget, including $79,387,489 of re-budgeted appropriations from the prior fiscal year, bringing the County’s revised net expenditure budget to $2.89 billion.
General Fund
Across all General Fund budget sections, total expenditure appropriations are increasing by $4,028,663 and revenue appropriations are increasing by $11,414,487, resulting in a net $7,385,824 accumulation of fund balance in the General Fund. The accumulation of fund balance is due to a one-time reimbursement from the American Rescue Plan Act (ARPA) Fund to the General Fund for previously incurred general government expenses. General Fund expenditure adjustments will be funded by a combination of grant revenue, previously approved General Fund Contingencies, non-General Fund sources, and release of fund balance assignments established during the FY 2025-26 year-end close process to carry funds forward.
Key highlights in General Fund sections include:
• Re-budget $1,500,000 for the Immigrant Support Notice of Funding Availability effort, funded by General Fund Contingencies approved in FY 2025-26 and rolled over in the Designated Purposes Fund.
• Re-budget $1,053,501 assigned in the General Fund during the FY 2025-26 year-end close process to continue work on various projects, including: $731,015 spread across multiple departments to continue work on information technology improvement projects; $210,000 to complete Probation’s office relocation project; and $112,486 to continue the Jail Medical Feasibility Study project.
• Re-budget $661,706 for the Integrated Justice System Phase 4 Modernization project in the Information Systems Department’s budget, reimbursed by funding previously set-aside in ISD’s Replacement A Fund.
• Add revenue appropriations of $8,439,325 to receive a one-time transfer of ARPA funds in the General Fund to reimburse previously incurred public safety costs that meet the criteria for ARPA's general government revenue loss category. This adjustment is needed to post final transactions by the December 31, 2026, deadline.
Other Funds
In budgetary sections that sit outside the General Fund, expenditures are increasing by $95,370,765 and funding sources are increasing by $34,506,942, resulting in a net $60,863,823 use of accumulated special and/or specific use fund balances. Of total expenditures in Other Funds, $72,326,800 (approximately 74%) of the budget adjustments are associated with Sonoma Water’s re-budgeted appropriations for multi-year projects.
Key highlights in Other Funds include:
• Re-budget various Sonoma Water multi-year projects, including climate resiliency and conservation, hazard mitigation, wastewater improvements and maintenance, and water storage.
o $13,821,601 for water system electrical and structural improvements, communications resiliency, cathodic protection upgrades, and right-of-way services to protect pipelines from corrosion.
o $8,386,259 for the South Park Barbara-Winston Collection System, Santa Rosa Ave, and McMinn Ave and Hughes Ave sewer replacements supporting restoration of Sonoma Creek Baylands which are vulnerable to flooding.
o $6,971,457 for natural hazard mitigation planning, assessments, design, and construction projects to improve water system reliability are partially funded by federal FEMA grant revenue. Projects also support disaster preparedness related to hazards identified through hazard mitigation planning.
o $6,656,783 for Supervisory Control and Data Acquisition (SCADA) software and hardware upgrades and electrical safety improvements to enhance networked data communication and data acquisition.
o $4,395,116 for channel maintenance, hydrologic and hydraulic modeling, sediment management, and design and construction of channel infrastructure improvements for flood control in multiple flood zones.
• Re-budget $5,871,183 in the Sonoma Valley County Sanitation District’s budget for design and construction of Sonoma Valley trunk main replacements, other treatment plant and distribution system improvements, routine maintenance needs, wastewater system reliability and protect infrastructure.
• Appropriate $8,439,325 for a one-time transfer of ARPA funds to reimburse the General Fund for previously incurred public safety costs that meet the criteria for ARPA's general government revenue loss category and recognize offsetting revenue in the ARPA Fund.
• Process technical budget adjustments totaling $6,602,200 in the Human Services budget related to HR-1 implementation efforts. Adjustments will reduce FY 2026-27 expenditures to align with only one year of anticipated expenses and reimbursements, and funds allocated to cover future year costs in FY 2027-28 and FY 2028-29 will be redirected to a new HSD holding fund to be re-budgeted in future years.
Refer to Exhibit A of the attached Concurrent Budget Resolution for a full list of adjustment details in the General Fund and other funds.
American Rescue Plan Act - Revenue Loss
The ARPA Coronavirus State and Local Fiscal Recovery Funds (SLFRF) provide needed fiscal relief for local government recipients that experienced revenue loss due to the onset of the COVID-19 public health emergency. Specifically, SLFRF funding may be used to pay for “government services” in an amount equal to the revenue loss experienced by the recipient due to the COVID-19 public health emergency. Government services generally include any service traditionally provided by a government, including provision of public safety and other services, and health and educational services. To use funds for general government services, governments must first determine revenue loss and may then spend up to that amount on general government services. The County’s estimated revenue losses due to COVID is $36.8 million, as calculated in accordance with U.S. Treasury’s guidance. Revenue loss is not claimed directly but requires eligible general government costs to be identified that match the amount being claimed.
To date, the County has incurred $19,979,024 of general government (revenue loss) ARPA projects, including $12,027,681 for the Public Health Lab and Morgue project and $7,951,343 million for FY 21-22 lump sum payments to employees. To ensure ARPA funds are fully expended by December 31, 2026, first quarter adjustments include a one-time transfer of up to $8,439,325 to reimburse the General Fund for the County’s previously incurred general government public safety costs that meet ARPA revenue loss requirements. The one-time transfer would be in addition to the $19,979,024 already expended for a total estimated utilization of $28,418,349 of the County’s allowable revenue loss. ARPA revenue loss funds would reimburse the County’s General Fund for previously incurred eligible general government expenses, which will in turn make discretionary fund balance available to meet other emergent needs. Funding related to this allocation will be discussed as part of the November 17 Fall Budget Update.
Disaster Projects Reimbursement Update
Since 2017, the County estimates $216.6 million in total disaster-related project costs, which includes $197.2 million incurred to date and $19.4 million for future construction projects. Of the total project costs, $204.1 million is estimated to be eligible for reimbursement by FEMA/Cal-OES and $102.1 million has been reimbursed. Of the remaining $102 million pending reimbursement, $56.3 million is for the General Fund, $45.1 million is for Roads repair work, and $600,000 is for Regional Parks repair projects.
The attached FEMA Project Summary report provides details by project, including total cost, applicable FEMA category, amount obligated to date, reimbursements received as of September 30, 2026, remaining funds expected, and the County’s local share of costs. The County has 10 open FEMA/CDAA Public Assistance events consisting of over 130 projects:
• DR4301 2017 January Flood - Event closeout in process - FEMA processing closeouts and obligating final funding
• DR4308 2017 February Flood - Event closeout in process - FEMA processing closeouts and obligating final funding
• DR4344 2017 Sonoma Complex Fires - Event closeout in process - FEMA processing closeouts and obligating final funding
• DR4434 2019 Late February Storms - Pending project approvals, appeals, and multiple SPI-Roads projects in construction
• FM5295/CDAA2019-06 2019 Kincade Fire - Pending CalOES review for project closeouts
• DR4482 2020 COVID-19 Pandemic - Pending project appeals and project closeouts
• DR4558 2020 Lightening (LNU) Complex Fires - Pending closeouts
• DR4569 2020 Glass Fire - Pending project closeouts
• DR4683 2023 California Severe Winter Storms, Flooding, Landslides, And Mudslides - Pending project closeouts
• DR4699 2023 California Severe Winter Storms, Straight-line Winds, Flooding, Landslides, and Mudslides - Pending project closeouts
The Disaster Finance Team in the Auditor-Controller-Treasurer-Tax Collector’s (ACTTC) Office is working regularly with FEMA and CalOES on the reimbursement process, but the County is still experiencing delays and awaiting release of funds for obligated projects. The delays stem from FEMA approval of projects, ineligibility appeals, as well as CalOES’ new process in line with FEMA’s Validate-As-You-Go (VAYGo) process, which requires thorough review of all documentation before releasing payment. Disaster Finance is working with affected County departments, Department of Emergency Services, and State officials to gain a better understanding of potential impacts. Disaster response costs have been temporarily covered through a mix of General Fund sources and other funds. In FY 2021-22, the Kincade Settlement Fund provided $20 million as a temporary bridge for reimbursement delays; repayment of the Kincade Settlement Fund will occur as FEMA reimbursements are received and overall Disaster Funds are balanced.
Strategic Plan:
N/A
Racial Equity:
Was this item identified as an opportunity to apply the Racial Equity Toolkit?
No
Prior Board Actions:
June 12, 2026 - Fiscal Year 2026-27 Budget Adoption
Fiscal Summary
|
Expenditures |
FY26-27 Adopted |
FY27-28 Projected |
FY28-29 Projected |
|
Budgeted Expenses |
|
|
|
|
Additional Appropriation Requested |
$99,399,428 |
|
|
|
Total Expenditures |
$99,399,428 |
|
|
|
Funding Sources |
|
|
|
|
General Fund/WA GF |
($7,385,824) |
|
|
|
State/Federal |
$17,734,947 |
|
|
|
Fees/Other |
$28,186,482 |
|
|
|
Use of Fund Balance |
$60,863,823 |
|
|
|
General Fund Contingencies |
$0 |
|
|
|
Total Sources |
$99,399,428 |
|
|
Narrative Explanation of Fiscal Impacts:
Refer to Exhibit A of the attached Concurrent Budget Resolution for a full list of departmental budget changes categorized by General Fund and Other Fund changes. The negative value in the General Fund sources line is due to the one-time ARPA revenue loss reimbursement resulting in accumulation of General Fund balance.
|
Staffing Impacts: |
|
|
|
|
Position Title (Payroll Classification) |
Monthly Salary Range (A-I Step) |
Additions (Number) |
Deletions (Number) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Narrative Explanation of Staffing Impacts (If Required):
N/A
Attachments:
Concurrent Budget Resolution with Exhibit A
Sonoma Valley County Sanitation District Budget Resolution
FEMA Project Summary
Related Items “On File” with the Clerk of the Board:
N/A