Editor’s note: While the city is using its federal CARES Act money to help those in need, the county is paying its employees so it can avoid budget cuts

The city of Sacramento is using much of its $89.6 million in federal coronavirus relief money to help small businesses, assist the homeless and train laid-off workers.

Sacramento County is taking a completely different approach with its $181 million share.

Instead of spending the federal cash on new programs responding to the COVID-19 pandemic or on direct aid to those affected, the county is using most to pay sheriff’s, probation and public health employees—and to avoid deep cuts to existing services.

In a report released Friday, county budget officials say that of the $148 million allocated in 2019-20, $104.2 million went to the Sheriff’s Department, $21.6 million to the Probation Department and $6.2 million to the Health Services Department.

Of the $33 million left to spend in the 2020-21 budget, county Public Health will get $14.3 million to expand COVID-19 testing and contract tracing, according to the report, which was presented Tuesday, Aug. 11 to the Board of Supervisors.

County Public Health Officer Olivia Kasirye told supervisors she submitted a $90 million budget for COVID-19 response, then reduced it to $44 million in federal funding by the end of the year. But she said she was told that a committee of top county officials allocating the federal money wasn’t accepting more requests.

A county spokesperson, however, said that the committee never received the budget requests or said they weren’t accepting more requests.

UPDATE: On Aug. 19, supervisors added $45 million in funding to Public Health to fight COVID-19.

Health Services Director Peter Beilenson told supervisors that if county Public Health gets the $44 million eventually, that will meet all the needs. Kasirye said those needs include personnel and overtime, lab supplies and resources for clinics and community health partnerships.

County CEO Nav Gill told supervisors that it’s news to him that not all the COVID-19 needs are being met. He said he’s disappointed and embarrassed by the lack of communication and said he’ll sit down with Public Health officials to clear it up. “I need to fix that,” Gill said

Several constituents who called into supervisors also criticized the amount of money going to the Sheriff’s Department, the lack of immediate spending on public health or community needs and what they called a lack of transparency.

In an open letter to supervisors, Faye Wilson Kennedy, chairperson of the Sacramento Area Black Caucus, questioned the amount of money going to the Sheriff’s Department instead of public health.

She said the allocation “borders on being fiscally irresponsible and morally reprehensible” given that Sacramento County has more than 12,200 COVID-19 cases and 179 deaths as of Tuesday, “with Black, Latinx, and other communities of color experiencing the deadliest effects.”

Kennedy also called for the funding decisions to be made with input from public health experts and from the community, instead of the internal committee of top county officials.

“We can do better, a lot better,” Cassandra Jennings, president of the Greater Sacramento Urban League, told supervisors. She said more of the federal relief money needs to be spent on helping the most vulnerable with food, housing, mental health and other needs.

While the federal CARES Act does not allow money to be used to “backfill” revenue losses directly, county budget officials say the rules do permit the funds to cover payroll expenses of employees whose “services are substantially dedicated” to responding to the COVID-19 crisis.

Swapping the federal money for general fund money means the county was able to save $161 million on its books for 2020-21, instead of just $19 million. That compares to the typical $70 million to $90 million carryover and will help offset a projected $170 million less in sales tax, hotel tax and other revenue due to the coronavirus recession, budget officials said.

And that will “avoid potentially massive budget cuts” that would be on the scale of those during the Great Recession and would hit critical programs, including public health, mental health, alcohol and drug treatment, public safety, child protective services, homeless services and parks, the report says.

But under questioning from supervisors Patrick Kennedy and Don Nottoli, Gill acknowledged that the CARES Act money could have been spent on supporting businesses and other direct aid. Gill insisted, however, that more money will be spent on public health and response to coronavirus. He also said that the county will seek more state and federal money for COVID-19 programs.

Nottoli said the county should be doing whatever is necessary to stop the virus, while Kennedy requested a report on all COVID-19 response spending, no matter the source of money. He said while he understands what county administrators did, they “got too cute.” “It looks like a shell game,” he said.

And Phil Serna, chairman of board of supervisors, called on supervisors, and not the internal administrative committee, to decide how to spend the remaining CARES Act federal money.

Supervisor Sue Frost, however, praised county administrators for their approach to keep the budget healthy and capture the federal money. “We had challenges before COVID,” she said.

The city, on the other hand, has decided so far to spend its relief money on direct aid to those being hurt the most.

As of Aug. 11, the city has approved $50.6 million in spending, including $22.1 million for small business assistance and recovery; $10.2 million for workforce training; $7.5 million for arts, the creative economy and tourism; $4 million for family services; $3 million for homeless services and housing and $2.2 million for youth enrichment.

Another $18 million is in the works, pending final council approval. On Tuesday, Aug. 18, the council will consider spending $1.46 million on all-day programs at community centers to help students struggling with online learning. All school districts in the county are starting the fall with virtual instruction only due to the pandemic.

The council will also consider a $750,000 contract with United Way California Capital Region for a program to bridge the “digital divide” by providing internet access to 10,000 households and computers or hot spots to 1,000.

Also, the city is in the middle of a survey of all residents and businesses to help guide how to spend the remaining money. Responses were due by Wednesday, Aug. 12.

But during the debate this week on the “strong mayor” city charter change headed to the Nov. 3 ballot, Councilman Jeff Harris warned against the $40 million a year set aside for inclusive economic development and youth programs in the measure, saying that the city will face some tough budget decisions due to the COVID recession.

The current budget passed by the council projected $60 million in COVID-related revenue losses in 2020-21. But by using a budget surplus, freezing any hiring and other cost savings, the council avoided any major cuts in services. Because businesses were shut down again in July due to a spike in coronavirus cases, the city is updating the revenue loss numbers. The city does have a $55 million “rainy day” fund.

Which approach is smarter—helping people in need right now, or guarding against distress later?