SUPERVISORS TO WEIGH REDUCING COUNTY RESERVE FUNDS IN WAKE OF FEDERAL CUTS TO FOOD AND HEALTH PROGRAMS FOR THOSE IN NEED

By Miriam Raftery

August 22, 2025 (San Diego) – On Tuesday, Aug. 26, San Diego Supervisors will consider a proposal to revise the county’s reserve policy to allow use of some reserve funds to cover critical services being cut by the federal government. The plan, Item 23 on the agenda, is proposed by Supervisors Monica Montgomery-Steppe and Terra Lawson-Remer, but has drawn opposition from Supervisor Joel Anderson.

According to the agenda item overview, “The County now faces threats from deep cuts due to the passage of H.R. 1, or the “One Big Beautiful Bill Act”—a law that hands massive tax breaks to billionaires and big corporations while slashing the critical services thousands of our residents rely on. In San Diego, the impacts are immediate and severe: over $300 million in new annual costs to the County, and significant cuts to food assistance, healthcare, and core social services that put local families, seniors, and veterans at risk.”

The County’s Chief Administrative Officer cited a need to reform the reserve policy in February to conform with recommended fiscal practices. To protect vulnerable county residents, the proposal calls for updating the County’s reserve policy to align with national best practice standards from the Government Finance Officers Association (GFOA) in two key ways.

Advocates argue that:

1. The reserve formula is inflated by basing emergency savings on total spending including one-time capital projects that could be delayed in a crisis. The County currently holds about $973 million in reserves; under GFOA’s approach, the reserves would dip to about $945 million.
2. The formula ignores hundreds of millions in flexible funds; the proposal would free up about $350 in flexible funds for use in a crisis, though no more than 25% could be used in any given year—and only when the County faces cuts in federal or state funding to core programs, or during a recognized economic recession or emergency.

“When federal leaders walk away, local government must lead,” the overview concludes. “This ordinance ensures our ability to act with clarity, flexibility, and responsibility, not austerity. Our job isn’t just to protect balance sheets or protect people. It’s to protect both, ensuring we meet urgent needs today while safeguarding San Diego’s future.

But Supervisor Joel Anderson, whose district includes vast tracts of unincorporated East County, sent an email urging his constituents to speak out against what he calls a “raid” on the county’s safety net that he argues could put communities in jeopardy.

“Today, our reserve fund only protects us for 60 days in the case of a devastating earthquake, fire, flood, or pandemic,” Anderson states. “Now, my colleagues want to lower this reserves standard which would limit the communities of Alpine, Bonita, Bonsall, Borrego Springs, Campo, Fallbrook, Julian, Lakeside, Mt. Helix, Pine Valley, Ramona, Rancho San Diego, Rancho Santa Fe, Spring Valley, and other unincorporated areas from having basic services and hamper our ability to rebuild our crumbling infrastructure.”

Anderson claims his colleagues on the board of Supervisors want to “raid our piggy bank for their pet projects and County bonuses,” though there is nothing in the proposal allowing funds for non-emergency expenditures such as bonuses, nor does Anderson address how else to help vulnerable residents losing healthcare, food or social services.

But he raises a valid point in noting that the City of San Diego didn’t have enough reserves to help its residents during record flooding last year, so the County had to “step up and do the city’s work," an example of why retaining adequate reserves is important. The point in question is how much should be deemed adequate?

A reserve is a financial safety net of funds set aside for unexpected crises such as natural disasters or a global pandemic, says Anderson, who concludes, “Maintaining strong reserves that will weather economic storms and disasters is the bedrock of good government and protects everyone, especially our unincorporated communities that rely solely on county services to maintain their roads and for their public safety.”

Whether you support or oppose the proposed changes to the reserve policy, you can make your voice heard by speaking and/or calling in to the Board of Supervisors meeting on Tuesday, August 26.