|County operations and services are funded by a variety of different revenue sources. The chart below displays the percentage of total revenues contributed by each revenue category. Additional information related to various revenue sources can be found in the FY 2014-15 Final Budget.
||Property tax bills are calculated by applying a 1 percent tax rate to the assessed value of real property and certain business personal property owned by tenants. The property taxes collected by the County are a funding source for local governments and school districts within the County. The chart below shows the percentage of property tax revenues that are typically distributed to various government agencies.
*County departments and fund centers are grouped together by functional areas, which are used to categorize the services the County provides.
The County is in stronger financial position than it was when it entered the Great Recession several years ago, and its credit ratings are a testament to careful management of the County’s finances by employees and elected officials.
Every year, the County’s Combined Treasury Pool Investment is rated by credit rating agencies based on its creditworthiness. In 2014, the County received high ratings from two nationally recognized rating organizations: Fitch Ratings and Standard & Poor’s Ratings Services (S&P).
Fitch Ratings consistently rates the County at the highest level. The County Treasury Pool once again received the highest credit rating issued by Fitch Ratings in 2014, an AAA/V1 rating, which means the County’s The “AAA” rating reflects the credit quality and diversification of the underlying assets in the County’s portfolio and appropriate management and operational capabilities. The “V1″ rating reflects low market risk and a strong capacity to return stable principal value to participants in an adverse interest rate environment.
Meanwhile, the County also received upgraded credit ratings from S&P with an implied AAA rating for general obligation, which is the highest rating issued. This means that the County has an extremely strong capacity to meet its financial commitments.
The County maintained an A rating from S&P for the Nacimiento water revenue bonds, but the Lopez Dam revenue bond rating decreased from an A+ to an A due to a change in how S&P reviews and analyzes the bonds.
County employees and elected officials continued to preserve the County’s good financial standing in 2014 and will work hard to do so into the future.
Maintaining low debt levels is important to ensuring the long-term financial stability of the County. State Law sets the County’s legal debt limit at 1.25 percent of the County’s total assessed valuation. However, the County has established much stricter debt guidelines for itself. The County’s target is to keep the annual debt service backed by the General Fund to 5 percent or less of the General Fund operating budget. Ratios less than 5 percent are considered favorable by bond rating agencies. This target is tracked each year through the Administrative Office’s performance measures. In Fiscal Year 2013-14, the County’s ratio was 2.7 percent. This ratio is projected to remain constant, as no new debt is currently planned.