Hard budget decisions on horizon 

In his annual statement at the start of San Mateo budget hearings, County Manager John Maltbie has been predominantly optimistic during recent years. But this week his message for 2007-08 was considerably more ominous.

Maltbie warned that county spending continues to balloon while revenue sources remain stagnant and might even shrink. He told the Board of Supervisors that San Mateo could no longer risk dipping into county reserves to fund programs. We could no longer rely on long-term continuation of an approximately $45 million yearly refund of local property taxes collected by the state’s educational revenue augmentation fund.

The county manager recommended that no new spending should be approved without either an equal source of new revenue or matched spending cuts to pay for it. He said California’s unpredictable fiscal fortunes make it necessary for San Mateo County to reach a balanced budget, which could be accomplished by 2013.

Maltbie blamed the $25 million deficit projected for the new $1.65 billion budget largely on a 28 percent rise in salaries and health benefit costs for county employees since 2004. He also pointed to San Mateo Medical Center’s $72 million subsidy from the county general fund, which is more than 5 percent of the 2007-08 budget.

As the budget hearings began, the Board of Supervisors appeared to be taking Maltbie’s warnings seriously. They unanimously voted to uphold closure of a $1 million long-term care ward at the medical center, resisting staff pleas to keep it open. Patients and 22 staff members will be transferred elsewhere in the county system.

Controlling the ever-growing expenses of the medical center would be a solid start toward bringing down county deficit spending. The hospital is to receive approximately one-third of its $230 million budget from San Mateo next year, a $12 million increase from 2006-07.

Maltbie believes the county should spend no more than the state-required $35 million minimum to fulfill its medical obligation to some 9,000 indigent residents. He has called for a study panel to investigate why San Mateo now pays close to three times as much.

The interim CEO of the medical center, Dr. Sang-ick Chang, told supervisors that the hospital is holding down costs by carefully monitoring drugs and supplies, and cutting eight jobs. A three-year-old drive to prevail on other local not-for-profit hospitals to share the burden of treating indigent patients is still ongoing, but has so far been fruitless.

Supervisor Adrienne Tissier suggested that the highly rated public medical center begin to market its services and compete for business with its own health plan. This seems to us like the kind of creative approach so badly needed if San Mateo County is to ever put an end to its financial bleeding for medical care.

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A daily newspaper covering San Francisco, San Mateo County and serving Alameda, Marin and Santa Clara counties.
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