Instead of devoting more money to underfunded child welfare services and enjoying better-than-expected performance at University Medical Center, Clark County commissioners found themselves cutting budgets Tuesday.
The changes to the $1.28 billion budget were a grim reminder of how the coronavirus pandemic and the efforts taken to contain the spread have so thoroughly upended the county’s financial forecasts.
Commissioners balanced the budget using one-time funding sources, cuts to contributions in public safety and health agencies, and concessions from employee groups. But the county will still confront a nearly $150 million deficit this time next year without a strong economic recovery.
“The use of these one-time resources is going to get us through what we hope is a temporary economic crisis,” Chief Financial Officer Jessica Colvin said, warning of a grim future if revenues do not rebound. “We are really looking at a significant decrease in the critical services that we deliver to the community.”
The deficits extend beyond the county’s general fund and into other areas that rely on the county for support, including child welfare and UMC.
“If it hadn’t been for COVID-19, the focus of our budget was going to be on the inadequate funding for child welfare,” Colvin said. “We still have that problem going into the (fiscal year 2021) budget.”
There is a $19.5 million deficit in the fund that supports child welfare, and others are not faring much better. The Las Vegas Metropolitan Police and More Cops funds, which support the department and hiring officers, face combined $56.4 million deficits. The county detention center fund has a $14 million hole and the shortfall at UMC is $217.6 million, according to a county document.
As part of its effort to reduce expenses, the county cut contributions by $20.8 million to police, $6 million to the detention center and $16 million to UMC’s capital needs, which Colvin noted only adds to existing deficits.
Hospital ‘a ghost town’
Balancing budgets in the era of coronavirus is a tough task faced by governments across the U.S., and hospitals are not exempt.
“We’re trying to recover slowly, but business is dramatically down overall,” UMC CEO Mason VanHouweling told commissioners. He said UMC took a “major dive” in mid-March amid stay-at-home orders, cancellation of elective surgeries and directives for people to go to the hospital only in an emergency.
“And the hospital really became a ghost town at that point,” he said.
The hospital treated COVID-19 patients and ramped up its supply of personal protective equipment, but it’s seeing about 60 percent fewer patients right now, according to VanHouweling. He said it is safe to visit doctors.
“It is going to be a tough year, but we’re going to try to beat that,” he said.
Better than first thought
Not all the news Tuesday was bleak: The county’s expected losses turned out to be $30 million lower than initially expected due to better projections of revenues from taxes. Still, the county projects a shortfall in revenue to the general fund of $289 million.
In addition to the cuts to police and detention, the shortfall was covered through a $37 million reduction in capital reserves and projects no longer needed; $66.9 million transferred from the rainy day fund; $12 million from a hiring freeze; and a conservatively estimated $2 million in voluntary furloughs and layoffs.
Colvin said the county was also looking to its bargaining units for $22 million in concessions for salaries and benefits.
County Commissioner Jim Gibson said that the budget underscored how important it is for the economy to get up and running, and he lauded Colvin and finance officials for their work under tough conditions.
“As tough as it is to face a time like this, we figured it out,” he said. “We’ve been able to cover it.”