LAKEPORT – In an effort to address unpaid vendors and a loan that needs to be repaid to the county's general fund, the Board of Supervisors on Tuesday took action to move funds into the county's Mental Health Department.

Earlier this month, the board approved a plan to eliminate 18 Mental Health positions because the department has a $1.1 million projected deficit in the coming fiscal year and owes $2.1 million to vendors, as Lake County News has reported. An additional three extra help staffers also will be laid off.

Chief Deputy Administrative Officer Matt Perry told the board that the Mental Health, Social Services and Public Health departments all receive sales tax and vehicle license fee monies – which are deposited into realignment funds.

Perry said state law allows the counties to reallocate up to 10 percent of the revenues between the realignment funds after a public hearing and based upon a board finding that the reallocations are based on the “most cost-effective use of available resources to maximize client outcomes.”

The board has taken such actions before – over a several-year period between 1997 and 2005, more then $886,000 was transferred from the Mental Health Realignment Fund to the Social Services Realignment Fund, Perry reported.

Then, in February 2007, when Mental Health was experiencing cash flow problems, the board authorized transferring $400,000 from Social Services back to Mental Health.

Due to Mental Health's fiscal situation, county staff was proposing transferring the remaining balance of the Social Services Realignment Fund – just over $486,000 – to Mental Health, Perry reported.

Perry said it's important to take the action, since vendors may discontinue the services if they aren't paid.

Since much more is still owed, County Administrative Officer Kelly Cox said he plans to bring the board a recommendation on May 26 for how to finance the cost of paying down Mental Health's bills from its vendors, including making a loan from the general fund.

Supervisor Anthony Farrington noted that he previously had suggested that the county may need to forgive the loan to Mental Health, and said that might be necessary in the interest of paying the vendors.

“We'll be taking care of all the debts that need to be taken care of next week,” said Cox. “Everybody needs to be paid, including the general fund.”

“So we're going to be looking at giving them another loan?” Farrington asked.

Cox said yes, otherwise the department won't be able to pay its vendors.

Farrington suggested having Mental Health hold off on paying the general fund and make paying the bills a priority. Cox said he didn't want to relieve the department of making payments they had agreed to make.

Board Chair Denise Rushing called the situation a “sobering reality.”

The board unanimously approved making the finding and reauthorizing the reallocation.

In other board news, the board offers proclamations for National Public Works Week, Emergency Medical Services Week and Motorcycle Safety Awareness Week.

The board also approved the transfer of Lake County Sheriff's K-9 to Deputy John Gregore.

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