FRESNO COUNTY – Despite deficit concerns mounting over the past year, Fresno County has set itself up with a balanced budget for the remaining nine months of the fiscal year.
After about three hours of budget hearings Sept. 14 and minimal public comment, the Fresno County Board of Supervisors unanimously adopted a final fiscal year 2026-27 budget of nearly $5.5 billion. County Administrative Officer Paul Nerland said that although the budget is balanced, it represents a planning approach that leaves the county with less wiggle room and fewer funds for capital projects.
Even as past presentations have included warnings of increased costs and decreased revenues, Nerland’s introduction to the budget and overview of the county’s recent work carried with it a tone of hope and gratitude. He said all the county’s entities tend to partner and work together when things are difficult, and “we’ve seen that time and time again.”
“The remarkable thing about the moment is really a lot of our greatest challenges also are our greatest opportunities, and that growth creates pressure to do things differently,” Nerland said. “Change can be difficult, but as a county, it’s an opportunity for us to take a look at how we do business and see that we can do it even better.”
Overall budget
As a whole, the Fresno County budget is made up of a blend of pass-through funding from the state and federal government and local tax dollars that the county uses for resident services based on the board’s priorities.
The figure of $5.5 billion comes from more than $2.7 billion in the general fund, $2 billion in special revenue and trust funds, $454.5 million in internal service funds, $183.8 million in capital projects, nearly $60 million in enterprise funds and $49 million in debt service. It’s a $150.9 million, or 3%, increase from fiscal year 2025-26.
Within the $2.7 billion general fund, $1.7 billion, or 63% of the budgeted appropriations, will support human services. Justice services will see $689 million, or 25%, administration and fiscal services will see $184.8 million, or 7%, and land use and development services will see $110 million, or 4%. Approximately $24 million, or 1%, will be designated for contingencies or reserves.
The budget allows for 8,308 employees, a net decrease of 20 staff positions from the prior year.
Discretionary balance
To explain how the county avoided a deficit in its general fund, Nerland and County Budget Director Paige Benavides reviewed the process the county goes through when determining its discretionary revenues.
Discretionary revenues are funds that the county does not have to use for a specific purpose. Unlike money the county receives from the state and federal governments specifically for the administration of Medi-Cal, for example, discretionary revenues can go toward anything the board wants to fund, such as staffing the public health department or purchasing equipment for the sheriff’s office.
Benavides said the discretionary revenues included in the 2026-27 budget come from two places: the existing general fund balance or carry-over from the previous fiscal year, and local tax revenues. Fresno County collects property taxes, property taxes in-lieu of vehicle license fees and the Bradley-Burns sales tax allocation.
It is these revenues that fund net county costs, which is the amount of money needed to cover a shortfall when a department’s appropriations exceed revenues from third parties, which can include state and federal funding or direct charges for services, Benavides said.
This year’s budget includes discretionary revenues of just under $550 million, with $124 million coming from the existing fund balance and $425.6 million coming from countywide tax revenue estimates. Fresno County got to that number by making less conservative projections of what its total tax revenue will be throughout the fiscal year.
Conservative approach
Nerland said one of the principles Fresno County takes in its budgeting approach is to focus on using realistic revenue estimates.
“In our county, we have worked to have very conservative revenue estimates, and although we continue that in this budget … the margin is much narrower than it’s been in the past,” Nerland said.
For example, when looking at tax revenue, Benavides said the county typically budgets for 2% growth every year. This is well below the actual property tax revenue growth the county has seen in recent years, which has come out to a five-year average of 6.3%.
When the county uses these smaller growth estimates for its budget, the actual discretionary revenue it brings in is higher. This allows Fresno County to have a cushion when there are unexpected expenses, put money into reserves or fund one-time projects.
For 2026-27, Fresno County built the budget with an estimated tax revenue growth of 4%. Though still lower than what the county anticipates it will bring in, the less conservative figure — and the exhaustion of one-time funding programs created after the pandemic — means Fresno County will have less maneuverability going forward, Nerland said.
