SLO County budget expected to grow next year

San Luis Obispo County’s budget is expected to grow about 3 percent in the 2017-18 fiscal year, according to a report received by county supervisors Tuesday.

The local economy continues to improve, but in the longer term, the closure of Diablo Canyon nuclear power plant — which employs 1,500 people locally — will have significant ramifications throughout the area, according to a staff report by Assistant County Administrative Officer Guy Savage.

The forecast is the first step in developing the budget for the coming year and helping supervisors establish their list of priorities. It anticipates the county’s general fund will have about $492.3 million in revenues and $486.2 million in expenditures, leaving about $6 million in discretionary revenue, possibly more.

The forecast projects that assessed property values will increase by 4 percent, which is good news; but the county has limited options to increase revenues since nearly 75 percent of its funds come from state and federal government programs and property taxes, according to a news release.

There are also several statewide challenges that could impact the county: water issues, and any loss in agriculture-related revenues due to the ongoing drought; a lack of affordable housing; and ongoing maintenance of roads, highways and other infrastructure.

The county’s primary focus to maintain a balanced budget remains on spending, Savage wrote in the staff report. The county needs to pay close attention to additional expenses for programs and services, and employee compensation. The salary and benefit calculations built into the forecast did not include any additional increases.

This story was originally published October 11, 2016 at 3:04 PM with the headline "SLO County budget expected to grow next year."