San Joaquin County FY 2025-2026 Budget
San Joaquin County FY 2025-2026 Budget: Deep Dive Analysis
Priorities, State & Federal Funding, Gaps, and Alignment with City of Lodi • Lodi411.com • February 2026
Executive Summary
San Joaquin County adopted a $3.02 billion structurally-balanced budget for FY 2025-2026, a $198.6 million increase (7.0%) over the prior year. This marks twelve consecutive years of balanced budgets without drawing on prior-year reserves. The budget prioritizes public safety, homelessness and behavioral health, parks and recreation, and major capital infrastructure—while setting aside $151.1 million in contingency reserves and contributing $34 million toward unfunded retirement liabilities.
The City of Lodi adopted a $291 million balanced budget for the same period, an 8.35% increase driven primarily by rising personnel costs. Unlike the County, Lodi faces a projected $4.8 million structural deficit over five years, a $1 million sales tax shortfall, and the lingering impact of an illegal business license tax refund. Despite these challenges, both governments share key priorities in public safety and homelessness, and are deepening their partnership through several jointly funded programs—most notably the Lodi Access Center, Housing on Main, and expanded SJ CARES services.
1. Budget Overview & Funding Sources
The total budget of $3,022,230,738 is funded through three primary categories, reflecting the County’s heavy dependence on state and federal revenue streams. Nearly 80% of the budget is driven by state/federal funding and fee revenue, leaving only about 16% in truly discretionary General Purpose Revenue.
| Funding Source | Amount | % of Total | Change Note |
|---|---|---|---|
| Departmental Revenue (State/Federal, Fees for Services) | $2.41 billion | 79.8% | Majority of increase; restricted for specific programs |
| General Purpose Revenue (Property & Sales Tax) | $476.8 million | 15.8% | Property tax +5%; Sales tax -2.8% |
| Non-General Fund Balances | $133.8 million | 4.4% | Project-specific reserves |
Fiscal Outlook Warning
While the current year balances, County staff project property tax growth will slow to 2% in coming years while labor costs grow at 3%, creating a structural gap. Deficits are projected beginning in FY 2027-28 ($11.4 million) and growing to $15 million by FY 2029-30. The budget does not include a remediation strategy for this gap.
2. Net County Cost (Discretionary Spending)
Net County Cost represents the $476.8 million in discretionary General Fund dollars allocated by the Board of Supervisors. Over 60% goes to Law & Justice, which received the single largest dollar increase (+$27.8M). Parks & Recreation saw a notable 24% proportional increase, signaling new political will for a traditionally underfunded area.
| Functional Area | Net County Cost | % Share | Year-Over-Year Change |
|---|---|---|---|
| Law & Justice | $286.3M | ~60% | +$27.8M |
| General Government | $66.3M | ~14% | −$2.3M |
| Human Services | $48.4M | ~10% | +$2.9M |
| Health Services | $40.0M | ~8% | +$758K |
| Environmental Protection | $18.7M | ~4% | +$1.9M |
| Parks & Recreation | $10.7M | ~2% | +$2.1M (+24%) |
| Contingencies | $5.0M | ~1% | +$761K |
| Education | $724K | <1% | −$97K |
| Capital Maintenance | $705K | <1% | −$1.1M |
| Roads & Facilities | $0 | 0% | No Net County Cost |
3. Significant Changes in Funding and Spending
Revenue Changes
- Property Tax +5%: Healthiest revenue source but projected to slow to 2% in coming years, creating a structural gap against 3% labor cost growth.
- Sales Tax −2.8%: Reflects statewide economic softening. HdL Companies projects only 1.7% California-wide growth. Mirrors Lodi’s $1M sales tax shortfall from projections.
- Medi-Cal Billing Expansion: SJ CARES will begin billing Medi-Cal for case management services under CalAIM—a strategic shift converting service costs into reimbursable revenue.
- Opioid Settlement Deployment: Active allocation toward Be Well Campus construction, Nursing Navigator services, Opioid Coalition operations, and Correctional Health/Public Health staffing. Approximately $80M identified in settlement capital-outlay funds.
Major Spending Changes
- Law & Justice (+$27.8M): New Public Defender positions for overwhelming caseloads, Cold Case Task Force continuation, Correctional Health compliance positions. Behavioral Health Services takes over jail mental health coordination.
- Be Well Campus ($261.8M multi-year): Largest capital commitment in the budget. A $137M Proposition 1 state grant was secured in May 2025. Includes 172 beds across four buildings for psychiatric health, substance use treatment, crisis stabilization, and the San Joaquin Valley’s first youth substance abuse residential program.
- Landfill In-Housing (+$7M annual savings): Public Works bringing landfill operations in-house and redirecting tonnage from Foothill to North County landfill.
- Parks & Recreation (+$2.1M / +24%): Irrigation improvements at eight parks, smart restrooms at five parks, South County Regional Park Phase 3, and a Countywide Parks Master Plan.
- Labor Cost Increases: All negotiated increases funded (3% for largest employee group). Projected at $818.6M in FY 2026-27, rising to $894.7M by FY 2029-30.
- Unfunded Retirement Liability: Full 5% contribution at $34M ($20.1M General Fund share).
4. Priority Issues and Programs
4.1 Public Safety (Top Priority — 60%+ of Discretionary Revenue)
Cold Case Task Force (DA’s Office), expanded Public Defender staffing, Correctional Health improvements for statutory compliance, Behavioral Health Services assuming jail mental health oversight, and the SAFE school security program ($5M federal request). The Board has made clear that law and justice funding will not be reduced, even amid fiscal pressure.
4.2 Homelessness & Behavioral Health (Flagship Investment)
The Be Well Campus in French Camp ($261.8M) is the centerpiece—the region’s first consolidated behavioral health and substance use disorder facility with 172 beds. SJ CARES expansion adds Whole Person Care case management with new Medi-Cal billing. Safe camping equipment and site development address immediate needs. The Lodi Access Center partnership extends county behavioral health and medical services directly into Lodi.
4.3 Parks & Recreation (Emerging Priority)
District 1 Supervisor Gardea championed parks funding for long-neglected County parks. Irrigation improvements, smart restrooms, South County Regional Park Phase 3, and the first-ever Countywide Parks Master Plan signal a new commitment to outdoor recreation and family spaces.
4.4 Capital Infrastructure
Sheriff’s Training Facility, Old Courthouse demolition at 222 E. Weber Avenue (with Public Defender facility planning), Safe Camping site for unhoused individuals, Lovelace Transfer Station replacement, and various federal requests for storm drainage, bridges, and water infrastructure.
4.5 Fiscal Stewardship
$151.1M contingency reserve (5% of expenditures), $34M pension contribution, $7M annual savings from landfill in-housing, and the 12th consecutive structurally balanced budget without using prior-year reserves.
5. Significant Gaps and Disconnects
1. Structural Deficit Looming: Despite the “balanced” label, staff project an $11.4M deficit by FY 2027-28 and $15M by FY 2029-30. The fundamental driver—property tax growth at 2% vs. labor cost growth at 3%—has no identified remediation strategy in the budget.
2. Be Well Campus Funding Gap: Of $261.8M total budget, only $66.3M was confirmed at Board approval. The $137M Prop 1 grant helps substantially, but approximately $58M still depends on pending federal grants and partnerships. Federal funding uncertainty under changing political priorities is a real risk.
3. State Cost-Shifting Risk: Supervisor Rickman explicitly warned about Sacramento pushing costs to counties. With 80% of the budget dependent on state/federal revenue and California facing multi-billion-dollar deficits, this is an existential vulnerability for County services.
4. Federal Medicaid Uncertainty: The strategy of billing Medi-Cal for SJ CARES and relying on BH-CONNECT (~$8B statewide over five years) depends on continued federal Medicaid support. Any restrictions or rollbacks would directly impact revenue projections and service capacity.
5. Capital Maintenance Cut While Projects Grow: Capital Maintenance was reduced $1.1M while launching multiple major capital projects. New facilities will eventually need maintenance budgets that aren’t being built into the baseline—a compounding deferred maintenance risk.
6. Education Deprioritized: Education Net County Cost fell to $724K (−$97K), a declining trajectory that may not reflect community needs, despite education being primarily state/school-district funded.
7. Limited Economic Development: Despite supervisors emphasizing growth, General Government spending decreased $2.3M with no visible new economic development initiatives beyond existing programs.
8. Homelessness Pace vs. Response Timeline: Lodi’s 2024 Point-in-Time count showed 416 people experiencing homelessness (+18% in two years, unsheltered +25%). The Be Well Campus won’t reach substantial completion until July 2027, and the Access Center won’t be fully operational until mid-2026.
6. State and Federal Funding Allocations
Approximately $2.41 billion (79.8%) of the County budget comes from departmental revenue including state and federal funding, largely restricted for specific programmatic uses.
State Funding
- Proposition 1 / BHCIP: $137M for Be Well Campus—part of the $3.3B statewide Behavioral Health Continuum Infrastructure Program.
- Medi-Cal / CalAIM: SJ CARES billing Medi-Cal for homelessness case management; Lodi Access Center services partially reimbursable through Medi-Cal/CalAIM.
- BH-CONNECT Demonstration: ~$8B statewide over five years through federal 1115 Waiver for community behavioral health services, transitional housing, and mental health care.
- CARE Act: $32.9M ongoing statewide + $17.4M for legal counsel for court-ordered treatment of individuals with untreated schizophrenia/psychotic disorders.
- Judicial Branch: Three new Stockton courtrooms as part of $350.9M statewide judicial projects.
- San Joaquin River Parkway: California’s first new state park in a decade at the SJC confluence.
- SB 1 Gas Tax / SJCOG: Ongoing formula transportation funding; ~$54M annually distributed across the region.
- Housing Intervention Programs: Beginning July 2026, 30% ongoing allocation for housing stability for individuals with behavioral health needs.
Federal Funding Requests (FY 2026)
The County submitted nearly $27 million in Community Project Requests:
| Project | Amount | Relevance to Lodi |
|---|---|---|
| Be Well Campus Outdoor Program | $3.8M | Regional benefit (all county residents) |
| Victor Storm Drain Retention Pond | $2.4M | Directly east of Lodi |
| SAFE School Security Program | $5.0M | Countywide school safety |
| Fixed Generators (water/storm drainage) | $2.7M | Countywide reliability |
| Corral Hollow Road Bridge Replacement | $2.0M | Southwestern SJC |
| Lincoln Village Water Main | $2.0M | Stockton area |
| CSA 44 Wastewater Treatment Plant | $2.5M | Stockton area |
| Mobile Veterans Outreach Vehicle | $320K | Countywide (29,000 veterans) |
Opioid Settlement Funds
Approximately $80 million identified in national opioid settlement capital-outlay funds, allocated toward Be Well Campus construction, Nursing Navigator professional services, Opioid Coalition operations, and Correctional Health/Public Health staffing.
CDBG & HUD Programs
Lodi receives ~$600K–$655K annually in federal CDBG funds from HUD. The County’s Neighborhood Preservation Division administers additional federal programs: Continuum of Care (CoC), Emergency Solutions Grant (ESG), California Emergency Solutions and Housing (CESH), and HOME funds, coordinated through the San Joaquin Continuum of Care covering all jurisdictions.
7. County & Lodi Budget Alignment
| Dimension | San Joaquin County | City of Lodi |
|---|---|---|
| Total Budget | $3.02 billion | $291 million |
| YoY Increase | 7.0% ($198.6M) | 8.35% |
| Balance Status | Balanced 12 years; no reserves used | Balanced; $4.8M deficit projected over 5 yrs |
| Top Priority | Public Safety (60%+ of discretionary) | Public Safety (37% of General Fund to police) |
| Sales Tax Trend | −2.8% projected | −$1M shortfall from projections |
| Behavioral Health | $261.8M Be Well Campus; SJ CARES expansion | Lodi Access Center (county-funded services) |
| Infrastructure | Sheriff training, courthouse demo, transfer stn | $16.9M: water, signals, Ham Lane, Transit |
| Key Revenue | 80% state/federal + property/sales tax | Local tax + Measure L (~$10M/yr) |
| Pension | $34M unfunded liability contribution | Underfunded pension addressed in CIP |
Where Priorities Align
- Public Safety: Both identify this as the top budget priority. The County’s 60%+ discretionary share mirrors Lodi’s 37% General Fund police allocation.
- Homelessness Response: The deepest alignment. The Lodi Access Center, SJ CARES expansion, and Housing on Main represent genuine joint strategy.
- Infrastructure Maintenance: Both investing in deferred maintenance and critical systems, though at different scales.
- Fiscal Conservatism: Both emphasize balanced budgets and sound reserves while acknowledging structural pressures ahead.
Where Priorities Diverge
- Parks: The County is making a significant new parks investment; Lodi’s park improvements are more modest, partially dependent on reserve funds.
- Revenue Vulnerability: The County’s 80% state/federal revenue somewhat insulates it from local economic cycles. Lodi depends heavily on local sales and property tax plus Measure L, making it more exposed to downturns.
- Scale of Behavioral Health: The County operates at a regional scale with the Be Well Campus; Lodi benefits from this but has limited capacity to invest independently in behavioral health infrastructure.
8. Shared and County-Funded Programs in Lodi
9. Conclusions & Outlook
San Joaquin County’s FY 2025-2026 budget represents a government investing aggressively in behavioral health and public safety while maintaining fiscal discipline. The Be Well Campus is a transformational project that, if fully funded and completed on schedule, could fundamentally change how the region responds to addiction, homelessness, and mental health crises. The County’s ability to stack state (Prop 1), federal, opioid settlement, and private funding demonstrates sophisticated grant strategy.
However, significant risks loom. The structural deficit projected for FY 2027-28 lacks a remediation plan. The County’s 80% reliance on state/federal revenue means any disruption from Sacramento or Washington creates outsized local impact. Supervisor Rickman’s warning about state cost-shifting is especially prescient given California’s own deficit challenges, and federal Medicaid uncertainty adds another layer of risk.
For Lodi specifically, the deepening County partnership on homelessness is the most impactful budget alignment. The Access Center, Housing on Main, respite beds, and SJ CARES all directly serve Lodi residents with County-funded resources. However, Lodi’s own structural deficit ($4.8M over five years), sales tax softness, and limited local revenue tools mean the city will increasingly depend on County and state programs for services it cannot fund independently. The scale divergence—$3 billion County vs. $291 million Lodi—means County service delivery within Lodi’s boundaries will likely increase, creating both opportunity (access to regional-scale programs like Be Well Campus) and dependency (reduced ability to set independent service priorities).
References & Sources
- San Joaquin County FY 2025-2026 Proposed Budget Press Release (June 4, 2025)
- Board of Supervisors Approves Annual Budget (June 18, 2025)
- San Joaquin County Digital Budget Book (ClearGov)
- Be Well Campus $137M State Grant Announcement (May 12, 2025)
- Board Advances Be Well Campus — $261.8M Budget Approval (April 22, 2025)
- SJC Federal Funding Requests — Nearly $27M (April 18, 2025)
- City of Lodi FY 2025-2026 Adopted Budget Press Release
- County & City Partnership: Lodi Access Center (City of Lodi)
- New County-Funded Projects Aim to Curb Homelessness in Lodi (Stocktonia, Oct. 2025)
- SJC Budget Without Reserves; Future Deficits Loom (Lodi News-Sentinel, June 2025)
- California Budget Update — January 2026 (Lodi411.com)
- Lodi’s Current Finances and Projections for 2026-2027 (Lodi411.com)
- SJCOG Funding & Programming
- City of Lodi CDBG Program
- SJC Homeless Assistance Programs
Prepared by Lodi411.com • February 27, 2026 • Analysis based on publicly available budget documents and press releases.