State of the County, 2014 – Challenges and Opportunities
By Chairman of the Board of Supervisors Jim DeMartini
Good morning my fellow members of the Board of Supervisors, CEO Risen, County Counsel Doering, those who are in the chambers today and those who might be watching on television or over the internet. It is a privilege to present the state of the county address for 2014.
Stanislaus County is a big place, over 1500 square miles. More than 520,000 of us live in our nine cities and unincorporated communities. Two of California’s three major north/south transportation corridors, Highway 99 and Interstate 5, come through us. Three rivers, the San Joaquin, the Toulumne and the Stanislaus, give us drinking water, allow our crops to grow and contribute to our recreation and relaxation. We have a California State University, a community college and several private educational outlets. And of course, we are close neighbors with UC Merced.
Stanislaus County’s government itself is big. We have 3900 employees, 26 different departments and an annual budget of more than 1 billion dollars. Because of the recession, we do the same amount of work, if not more, than in 2008, but with 750 fewer employees. And those who work for the county have seen their wages reduced as we have tried to meet the new fiscal realities. We owe them a debt of thanks for their dedication and commitment in trying times.
The employees of Stanislaus County continue to be our greatest asset. Over the last few years County employees have been asked to do more with less and have responded. Everyday our employees are out on our roads, in our neighborhoods and working in our departments providing services to the members of our community. On June 30, 2014, labor contracts for all represented County employees will expire. Over the next six months, the County will be working to complete negotiations with all twelve County labor groups. Our goal will be to recognize the value of our employees while ensuring the County remains fiscally viable in light of the uncertainty surrounding the long term economic recovery.
We have big, and at times, daunting challenges. Our unemployment rate is too high. We have a water crisis. We need to improve public safety for our residents. Most importantly, we need to restore hope. Too many of our neighbors believe that the avenue of opportunity is closed to them. It isn’t, but they remain to be convinced.
The foundation of Stanislaus county’s economy is agriculture. I want to speak a bit about this not just because it is my profession, but because it is so important to all of us, and because it represents the foundation upon which hope and opportunity can be built.
We sometimes take agriculture for granted. We shouldn’t. In Stanislaus County, it is a multi-billion dollar business. The value of agriculture commodities produced in Stanislaus County is over 3 billion dollars. With the multiplier effect the impact in Stanislaus County is 11 billion dollars a year. Ag related business such as E & J Gallo Winery, Del Monte, Foster Farms, Seneca, Stanislaus Food and ConAgra are some of the county’s largest employers.
My family emigrated from Switzerland and has farmed in Stanislaus County for more than 100 years. I am my family’s third generation and I’ve been a farmer for over 40 years. The San Joaquin Valley and Stanislaus County in particular, is the most productive and bountiful farm ground in the world. The Mediterranean climate that we enjoy is extremely rare in the world. Couple that with our productive soils and an extensive irrigation system fed by the Stanislaus, Toulumne and San Joaquin Rivers, and we have the ability to grow more than 200 different crops. This is unique n the world. Today this valley leads the nation and the world in production of almonds, walnuts, peaches, apricots and milk. It is the envy of other agricultural parts of our own country. In the national and worldwide agricultural community, California is known more for its agricultural products than for Hollywood, our beautiful coastline or the Silicon Valley.
Through the years we hear of Stanislaus County becoming an economic engine for industries other than agriculture, but much of that is unrealistic. We will never be a tourist mecca like the coast. Nor are we going to attract the California film industry here or become another Silicon Valley. I am not suggesting we shouldn’t diversify and look for other opportunities, but we need to lead with our strength. Our strength is agriculture.
Unemployment is chronic in our county. According to a report from California State University Stanislaus, employment in the valley lags behind the state in employment growth. In order for there to be growth in employment, we need diversity in our economy that will provide jobs that complement our economic base. The medical industry is one example of this, and it employes over 10,000 people here. Warehousing and Distributing have added many good paying jobs with the Patterson area gaining the most. We can add jobs in Riverbank at the ammunition plant. Turlock has developed its job center area with the Blue Diamond plant as its foundation. Hilmar cheese plans an expansion there also.
We need to take advantage of our fine educational institutions and partner with UC Merced, CSU Stanislaus and MJC. The new leadership at these educational institutions is poised to work with business leaders and others to assist in not only sustainable job growth but economic growth. We need to be more aggressive in attracting more companies that will bring “core jobs” to our county. We need our cities and the county to work more closely together to better coordinate these efforts.
Many years ago, when I was a student in a high school ag class, our teacher asked us what we wanted to do when we grew up. Since all of us were from farm families, each of us replied that we wanted to be farmers. Our teacher then explained that our agricultural economy is like an hour glass. The top part of the hour glass represents all of the inputs to agriculture, the things needed to make farming work: the tractor and irrigation companies, the people who provide the fertilizer, fuel, trucking and nursery stock, the bankers, accountants and repair shops needed by farmers. All of these occupations fill the top of the hour glass.
The farmer and the farm worker is the narrow part of the hour glass, where the fewest amount of people are employed. This was where all of us in that class wanted to be. The bottom part of the hour glass represents the people and suppliers involved in the processing, distribution, sale and transportation of the farm products: the canneries, wineries, truckers, packaging companies and grocery stores.
The point my teacher was making was that you don’t have to be on a farm to be employed by agriculture. It is something I never forgot. Agricultural inputs, production and processing account for 38% of Stanislaus county’s employment. That doesn’t include the teachers, doctors, accountants, plumbers, auto mechanics and others who serve and work with those who are directly engaged. Agriculture truly is the “big tent” that shelters all of us.
We have the most productive and abundant agricultural industry the world has ever seen. In the United States in 1900, the average family spent 43% of their income on food. In 1950 that percentage went down to 30%. Today only 9% of the average family’s income is spent on food. When the United States Department of Agriculture expanded its activities in the Great Depression, our leaders said the purpose of our agricultural policy was to provide Americans with a health, inexpensive, abundant and varied food supply. It is fair to say that California, and our valley, have been instrumental in achieving that purpose. We ought not, and we will not, risk this resource.
Agricultural land should not just be considered the inventory for the next housing tract or warehouse. Ag land is an important and irreplaceable natural resource that is responsible for employing more people than any other industry in this county. It is time we recognize this reality. We will not improve ourselves by paving over our most productive agricultural land or by simply becoming a bedroom community for the Bay Area. It is important that we recognize the uniqueness of what Stanislaus County has and build on that strength.
No one understands agricultural policy and its importance like people from Stanislaus County. That is why our county has produced two United States Secretaries of Agriculture: Ed Lyng and Ann Venemen, and four California Directors of Agriculture: Henry Voss, Clare Berryhill, Anne Venemen and Bill Lyons. Much of the national and state agricultural policy has been driven by Stanislaus county citizens. Agriculture is in our blood.
The Stanislaus County Supervisors have addressed some of the challenges facing agriculture.
* We adopted the Right to Farm Ordinance, which recognizes the right to farm in a manner consistent with accepted customs and standards. This has protected our farmers from frivolous law suits and unrealistic demands.
* We extended the Williamson Act to protect agricultural land and open spaces.
* We passed the Ag Element which recognized the importance of our agricultural sector and set goals and objectives that include enhancing the marketing and promotion of agriculture, protecting food safety, soil erosion prevention and water conservation.
* We passed the first agricultural preservation requirements in the San Joaquin Valley, stipulating one acre of land be set aside in perpetuity for every acre of land taking out of production for construction of residential housing. Although Stanislaus County was sued by the Building Industry Association, we prevailed.
* Citizens adopted a measure requiring countywide voter approval of any new residential developments in the unincorporated areas.
* The Stanislaus Local Agency Formation commission (LAFCO) now requires cities without our county to adopt a Plan for Agricultural Preservation. CaLAFCO recently awarded our Local Agency Formation Commission two of its highest honors: Most Effective Commission and Project of the Year for its Agricultural Preservation Policy.
* 2014 marks the 100th year of the establishment of the Stanislaus County Farm Bureau and the UC Cooperative Extension. Both organizations have done much to benefit our agricultural industry. The UC Cooperative Extension provides research, education and technical assistance that helps our farmers develop best management practices and makes them more competitive in the world market. The Stanislaus County Farm Bureau represents farmers and ranchers at all levels of government and consistently is a strong and positive voice for all sectors of agriculture. Both organizations have given Stanislaus County 100 years of outstanding service. We look forward to their continued leadership in meeting the challenges of the next 100 years.
But despite these successes we still have further to go. We face serious challenges in two major areas: transportation and water.
TRANSPORTATION
Evey industry in this county, including agriculture, relies on a sound transportation system to move its people, goods and services. Counties with a local transportation tax, which we refer to as “self-help” counties, are able to use local dollars to leverage billions of Federal and State dollars each year for improving their transportation systems. This in turn helps create jobs, expand mobility and enhance local communities. Currently over 81% of California’s population resides in a self-help county, placing Stanislaus County at a huge disadvantage when it comes to competing for limited transportation funding. Local leaders broadly accept that we need to be a self-help County. But if we do ask voters to consider the issue again, StanCOG must develop an allocation plan with the cities and the county, and a list of county-wide projects that we all can agree on. I call on each city council of our nine cities, as well as the County Board of supervisors to pass a resolution agreeing on the allocation formula and the county-wide road projects. This unified focus is essential to gaining the trust of and support from the voters on this important issue. Unless the County and the cities move as one on a transportation measure, we will not be successful. The model that nearly passed in 2008 should b the basis of any new proposal. Partnership and cooperation is the key.
In that election, a change of only 70 votes out of over 160,000 cast would have given us the 2/3 margin we needed. No one likes tax increases, but we can only move this forward if we act together. But if we don’t move together, we will not move at all.
WATER
Another major challenge is water. We are over pumping at an alarming level. Management of the county’s groundwater is a new arena for us. Every city in Stanislaus County relies on groundwater for drinking water. To a great extent, agriculture relies on groundwater. The current drought conditions have focused our attention on this vital natural resource. The depletion of the groundwater resources that serve our County is not simply a drought related issue; it is an issue of sustainability. Recognizing the critical importance of a groundwater policy, this Board took action last year to prohibit its export and sale. We have now formed a water advisory committee made up of representatives of agriculture, irrigation districts and community members. This committee has been charged, with public input, to develop a well thought out policy that will provide a sustainable solution to groundwater over drafting. This policy must be developed using scientific facts and it must provide us with long term solutions. There is no value in pointing fingers and there is no time for delay. We need to act. if we don’t and the problem worsens, the state of California will intervene and we risk the ability to control our own destiny.
The Don Pedro Dam is now coming up for federal re-licensing. This is a critical issue for Stanislaus County. We need to partner with the MID and the TID to ensure we retain the water that is ours. We must work with our local elected officials, with our representatives in Sacramento and at the federal level. We cannot take it for granted that this will just happen. Our entire economy depends on this effort. Giving up any additional water from Don Pedro Dam will have long lasting negative implications for all of our citizens and our agricultural industry.
While I believe transportation and water are critical issues, there are other important concerns affecting County government and the well being of our residents.
StanCERA
The Stanislaus County Employees Retirement Association, (StanCERA) is the agency that governs the pension fund of our county’s 3300 retirees and holds in trust the retirement money of our current employees.
It is made up of public members appointed by the Board of supervisor and members elected by county employee associations. This board has acted responsibly and with vision in difficult times. StanCERA took a big hit in 2008 with the recession. Our fund balance dropped by $874 million in February of 2009. It is now at $1.7 billion. In addition to prudent investment decisions that account for part of this gain, StanCERA adjusted its formula that governs how much money needs to be set aside to insure these obligations are met. The assumed rate of return was lowered to a more realistic level. We closed the rolling amortization period so debt didn’t just get put off into the future. We have adopted a policy to reduce the risk inherent with investing in these funds. We will take measured steps to replace some investments with guaranteed bonds so that the cash flow needs of StanCERA will always be met. In the 2012/2013 fiscal year StanCERA’s earnings rate, as compared to other public pension funds in the United States, ranked third nationally and second in California. Our funded ration is now close to 78%. Our retirees, and our current employees, and county taxpayers can feel confident that their fund is well managed and based on sound financial principals.
In 2007 this Board adopted a metal theft ordinance requiring scrap metal dealers to be licensed and to record information about sellers for every transaction when individuals were selling non-ferrous metals. Prior to the ordinance, metal theft was increasing at an alarming rate. This ordinance was so successful that then Assemblyman, Tom Berryhill introduced a bill similar to the Stanislaus County’s ordinance and it became state law.
Today we have similar problems with walnut theft. There re more than 38,000 acres of walnuts in Stanislaus county with a farm gate value of $220 million dollars. Walnut theft has increased to disturbing rates. I suspect that there is hardly a walnut grower in the County who hasn’t suffered losses. I am generally the last one clamoring for more regulation, but walnut theft is something we must make a serious effort to stop.
As with metal theft, the problem must be addressed at the point of purchase, which in this case involves unlicensed roadside vendors not requiring proper documentation or proof of ownership by the seller. Another concern is food safety. Under legitimate operations processors can trace any contaminated product back to the grower. Having roadside cash buyers mixing any and all nuts, stolen or not, erases the chain of accountability should any unsafe product be introduced. I call on the Ag commissioner to work in conjunction with the Ag advisory board to draft a reasonable ordinance to address the increasing problem of walnut theft and present it to the board for consideration this year.
PSYCHIATRIC HEALTH FACILITY
Over the past two years, Stanislaus County has had a dramatic increase in acute psychiatric inpatient admissions. This increase impacts bed capacity and creates a financial burden for the County. In the past year, County staff and all area hospitals met and began a working relationship that focused on addressing the psychiatric bed capacity issues and the growing need to secure programs to meet the County’s mandated obligations. As a result, a new 16 bed psychiatric health facility will provide psychiatric treatment services designed to require less staff than an acute psychiatric hospital, and reducing overall cost to the county by $1.5 million while providing better services to county residents. An existing and now vacant residential facility located at the County’s Stanislaus Recovery Center site in Ceres is currently being renovated and is on track to open March 1 of this year.
CHILDHOOD OBESITY
Stanislaus County’s health delivery system has always struggled to keep pace with the needs of our community. The Board has a strong commitment to serve the public interest by promoting a healthy community. One health issue that merits our attention is the alarming rate of obesity among children. In Stanislaus County more than 40% of 5th, 7th and 9th grade students are either overweight or obese. Obesity and physically inactivity can have profound negative health consequences for children. Increase risk of diabetes, heart disease, hypertension and stroke are just some of the potential consequences.
Obesity has become second only to tobacco use as the leading preventable cause of disease and death. If this trend continues, for the first time in human history, today’s children could be the first generation to have a shorter life span than their parents. Recognizing the magnitude of this problem and the serious public threat to the health and well-being of children and families, all nine Stanislaus County cities have passed resolutions to embrace policies that facilitate activities to promote a healthier lifestyle and diet. These policies could provide increased opportunities for physical activity in our parks by encouraging walking and biking.
I call on Stanislaus County to recognize this growing problem, and pass a similar resolution as our nine cities have. We all need to work together to assure that everyone in Stanislaus County has access to healthy foods and safe places to be active. Providing health environments and healthy choices promotes healthy people in a healthy Stanislaus.
PUBLIC SAFETY REALIGNMENT
We have read about and many have experienced the increase of crime in our communities. The security of our homes, neighborhoods, schools and businesses is essential to the quality of life. If you fear to let your children go to the park, or walk to school, not much else matters. This County will continue to make the public safety of our residents a priority.
Public Safety Realignment under Assembly Bill 109 continues to be a significant challenge for Stanislaus County. The effects of this paradigm shift in our criminal justice system have increased our costs and affected the jail bed capacity in our County. Our correctional facilities are at a maximum capacity and realignment has forced us into early releases from custody. Additionally, property and drug offenses continue to impact our community. Despite the challenges of realignment, Stanislaus county has focused on our strong collaborative partnerships and spirit of cooperation.
Our local public safety agencies and the members of the Community Corrections Partnership have taken on the difficult task of leading our local realignment efforts.
Through their leadership and planning, we have developed an effective strategy to deal with complex issues such as recidivism, substance abuse and mental illness. Efforts have focused on implementing only those programs and services that have the best results and are proven to work.
While the state provides funding to the County, the funding is not adequate to compensate for the costs of realignment. The number of criminal offenders we house and supervise continues to exceed state projections resulting in increased overcrowding in our jail facilities and in the number of offenders being supervised in the community. Funding formulas used to determine the county’s allocation of realignment funding are being reviewed. If the number of offenders sentenced locally continues to increase, and if the state does not increase the funding to Stanislaus County, other resources will be needed to fund realignment programs.
We will continue to advocate for a change in the funding formula, as well as the total dollars available for realignment so that more money can be brought to Stanislaus County. The County will continue to work together with our public safety partners and community based organizations to effectively deal with our offender population.
WHAT WE NEED IN 2014
Cooperation is the key to meeting our challenges. City and county government must work better together. The dispute over the property tax administration fees was divisive. That is behind us now and we need to come together. We can disagree and argue, but in the final analysis we need to cooperate. Our cities are our partners, not our adversaries. Challenges that face our county and our communities will either be dealt with in a timely manner that results in a positive momentum for our residents or be dealt with in a way that hurts our economy and our ability to succeed. The county and the cities don’t get a pass. Stanislaus County doesn’t win if the cities lose and the cities don’t win if this county loses. There will be no progress on infrastructure, on water or on other important issues unless we learn to work together.
In order for farmers to be successful, they must deal with all kinds of unforseen circumstances, which can impact the bottom line. They are resilient, innovative and independent. Our government needs the same approach to its day-to-day business. Neither Sacramento nor Washington is going to come riding into the Valley and improve our schools, arrest our criminals, build our infrastructure, take care of our elderly or insure equal opportunity for our children. They won’t safeguard our groundwater or protect our farmland in a way that best serves us. We are the only ones who can do that. Finger pointing may make us feel good, but the obligation to make our county more prosperous rests squarely on the 520,000 people who live here. Events beyond our control will shape our future. How we handle those events however, is fully in our hands.
These are big issues, but together, we are up to the task. I want to thank my fellow board members, department heads and all the employees of this organization for their dedication and commitment to excellence. Together we will pursue our vision of becoming “a county that is respected for its service in the community and is known as the best in America.”
Eye On Modesto 