Orange County’s overall spending plan for the 2026-27 fiscal year is proposed at $10.5 billion, about half of which would be supporting day-to-day operations through the general fund, according to a budget set to be discussed by the OC Board of Supervisors on Tuesday, June 9.
The budget request is less than last year’s by about $300 million, in part because “many of the claims for the Airport fire were settled and paid in the current fiscal year,” county spokesperson Molly Nichelson said in a statement.
Last fiscal year, the county appropriated nearly $500 million to cover possible payouts on claims from fire victims of the Airport fire. As of May 26, the county had settled more than 1,200 claims, paying out $133 million.
Nichelson said the proposed spending plan includes a 5% reduction in the county’s general-funded departments — roughly $32 million — to “align the department’s planned expenditures with the funding available.”
“The challenges faced this year centered around the impacts from the state and federal governments, given significant changes imposed on the federal safety net programs, such as CalFresh and Medi-Cal,” Nichelson said. “The budget does ensure the core responsibilities are met, such as with community services, infrastructure and public safety.”
The county expects to receive $1.3 billion in general-purpose revenue that covers day-to-day operation costs — roughly $64 million more than the current fiscal year. The boost is driven by a $58 million bump in property tax revenues, which account for 92% of the general purpose fund.
Sales tax revenues are expected to be higher as well, driven by an $11 million revenue bump from a half-cent state sales tax for public safety.
The vast portion of the general purpose funds, however, are tied to programs the county is legally required to provide on behalf of the state and federal governments, including law enforcement, public health and social services. About 19% of the revenue can be used for non-mandated needs such as capital improvement projects, officials said.
“Budgetary pressures driven by ongoing state and federal policy changes, an unpredictable economic environment, limited revenue growth and rising costs of doing business persist,” county CEO Michelle Aguirre wrote in her introduction to the proposed spending plan. “However, the county and the Board of Supervisors remain firmly committed to preserving the range and quality of services provided to the community while maintaining adequate reserve levels.”
As in years prior, community services make up the largest spending category, accounting for about 36% of the operating budget. The sector covers the county health department, social services, community resources, which includes services such as library and parks, and child support services. Funding for these departments is proposed to increase modestly.
The second largest program is infrastructure and environmental resources, which comprises 21% of total spending and includes OC Public Works, John Wayne Airport, and OC Waste & Recycling. The budget request from Public Works is $3 million lower from the current fiscal year due to internal cost savings and revenue growth from utility rate adjustments, officials said. Overall spending in this category, however, is expected to rise by $232 million as the county looks to fund large infrastructure projects.
Public protection accounts for 19% of the budget, with funding the Sheriff’s Department, the District Attorney’s Office and the Probation Department. Proposed spending for these departments is $35 million higher due to “rising costs and lower anticipated revenue,” officials said.
Meanwhile, the county is also projecting to receive $54 million less in “realignment revenues,” which funds juvenile criminal justice, mental health and social services.
The Board of Supervisors is set to hold a budget hearing during its June 9 meeting and is expected to adopt the budget at its June 23 meeting.