San Joaquin County leaders painted an optimistic picture of the county’s future during the 2026 State of the County address, highlighting investments in public safety, homelessness services and behavioral health while acknowledging financial challenges that could affect essential services in the coming years.
Board of Supervisors Chair Sonny Dhaliwal delivered the annual address Wednesday under the theme “United in Service, Focused on the Future,” reflecting on the county’s growth, accomplishments and priorities as local officials navigate changing economic conditions and federal policies.
“I am proud to say the state of our county is strong because the spirit of our people is strong,” Dhaliwal said. “Our county is changing. We are growing. We are facing challenges, and we are creating new opportunities.”
Dhaliwal, who represents District 3 and previously served as Lathrop’s mayor, emphasized the importance of creating jobs, improving infrastructure, expanding health care and preserving the county’s agricultural heritage.
He also identified homelessness as a continuing challenge, calling for an approach that balances compassion with accountability.
“Our responsibility as leaders is not simply to manage government; it is to make sure that every family has an opportunity to build a better future,” Dhaliwal said.
The address comes as San Joaquin County pursues several major initiatives, including construction of a behavioral health campus in French Camp and expanded efforts to address homelessness, while preparing for potential reductions in federal funding for health care and social services.
County Administrator Sandy Regalo followed Dhaliwal’s remarks with an overview of the county’s finances, public services and infrastructure projects, outlining what the county has accomplished and what officials expect in the coming year.
Homelessness efforts show progress as county takes tougher approach
Among the achievements Regalo highlighted was a nearly 50% decline in unsheltered homelessness since 2024.
The county’s 2026 point-in-time count identified 1,838 people living outdoors, compared with 3,469 two years earlier, a 47% decrease.
Regalo attributed part of the county’s progress to SJ Cares, an initiative led by the Probation Department that connects people experiencing homelessness with housing and other resources.
She said the program helped 162 people move from the streets into housing, including 60 who achieved permanent, stable placements.
The county also reported an increase in sheltered homelessness, which Regalo attributed to more people using available shelter options.
However, the county’s efforts to reduce homelessness have also involved a more aggressive approach to encampments and people who decline offers of assistance.
Sheriff Patrick Withrow said deputies give unhoused individuals one hour to accept shelter, treatment or other assistance before potentially facing arrest if they refuse to leave.
During that forum, District 4 Supervisor Steve Ding also expressed support for stronger enforcement measures, pointing to San Francisco’s approach to clearing encampments.
The tougher stance has emerged alongside investments in shelter capacity, housing assistance and behavioral health services.
During Wednesday’s address, Regalo said the Sheriff’s Office Community Revitalization Unit cleared 342 encampments and addressed more than 100 illegal dumping sites over the past year.
The county celebrated the reduction in unsheltered homelessness but did not address during the presentation how enforcement actions may have affected the count or how many people displaced from encampments ultimately obtained stable housing.
Behavioral health campus among county’s largest investments
Another centerpiece of the county’s plans is SJ Be Well, a behavioral health treatment campus under construction in French Camp.
Regalo described the project as a $342 million investment in mental health and substance use treatment, with more than $38 million in additional state funding secured since construction began in 2025.
The campus is expected to include a 76,000-square-foot outpatient center, a 42-bed urgent care unit, two residential treatment buildings and 252 beds of supportive transitional housing on the north campus.
“In just over a year, the Be Well campus will open its doors,” Regalo said.
The project has been a priority for county supervisors for several years.
In April 2025, the board approved $261.8 million for the project’s first phase, which officials said would expand treatment options for residents experiencing mental health and substance use crises.
The county subsequently secured a $137 million state grant to support construction.
County officials have described the campus as an alternative to relying on hospital emergency departments or incarceration for people experiencing behavioral health crises.
Regalo said the development represents a broader commitment to improving access to services for residents across the county.
“This is transformational work,” she said.
Federal funding uncertainty clouds county’s financial outlook
Despite the optimistic tone of the address, Regalo acknowledged that San Joaquin County faces financial pressures as federal policy changes threaten revenue for local programs.
She said the county has maintained a balanced budget for 13 consecutive years and is operating with a spending plan of more than $3 billion.
That financial stability, however, could face additional pressure from H.R. 1, the federal budget law signed by President Donald Trump in July 2025.
“This year, that achievement carries even greater weight as counties across California are feeling the financial impacts of H.R. 1,” Regalo said.
“We know, however, that we are not immune to declining revenue.”
The potential consequences have already been the subject of county discussions.
In March, San Joaquin County warned it could lose between $50.9 million and $76.9 million annually because of federal funding changes affecting health care and social assistance programs.
County officials identified San Joaquin General Hospital, the Health Care Services Agency and the Human Services Agency among the departments most vulnerable to those reductions.
At the time, Dhaliwal warned that the financial burden could result in reduced local services, longer hospital wait times and declining access to health care.
During the State of the County address, Regalo did not provide an updated estimate of the potential losses or specify whether the county anticipates service reductions.
Instead, she emphasized the county’s efforts to manage resources responsibly, including the implementation of a new financial management system and the collection of $1.8 billion in property taxes.
She also noted that SJ Health recently received a $650,000 federal grant and transitioned to a federally funded health center, which she said would create additional revenue opportunities.
Public safety, agriculture and infrastructure remain priorities
Public safety continued to feature prominently in the county’s annual assessment.
Regalo said the Sheriff’s Office responded to more than 44,000 calls for service and investigated more than 2,300 property crimes over the past year.
The Probation Department also conducted more than 26 joint operations with local and federal agencies, resulting in more than 100 arrests and the seizure of nearly 40 firearms, she said.
Regalo highlighted the opening of the Dorothy J. Heisler Detention and Programs Facility and the District Attorney’s Office’s expansion of the Family Justice Center in Stockton.
Beyond law enforcement, county leaders continued to emphasize protecting agriculture and the Sacramento-San Joaquin Delta.
Regalo reiterated the Board of Supervisors’ opposition to the Delta Conveyance Project, the state’s controversial proposal to build infrastructure that would transport water around the Delta.
She also highlighted the county’s declaration of a local emergency in response to the invasive golden mussel, which poses risks to waterways and water infrastructure.
Agriculture remains a significant component of the county’s economy.
San Joaquin County’s agricultural production exceeded $3.3 billion in 2025, Regalo said, representing an increase of more than 6% from the previous year.
Almonds became the county’s most valuable crop as grape and cherry growers experienced setbacks.
Regalo also highlighted infrastructure improvements, including upgrades to all 27 county-operated traffic signals and the closure of the Foothill Sanitary Landfill, which officials estimate will save approximately $80 million over 15 years.
Manteca youth center honored for community work
The county also presented its Growing Greatness Award to the Thomas Toy Community Center in Manteca, recognizing an organization that has become a gathering place for local teenagers seeking academic support, mentorship and a sense of belonging.
In just over two years, the center has grown to serve 60 to 90 students daily, with four to five new members joining each week, according to Executive Director Amber Butler.
The center offers more than traditional after-school programming. Students in seventh through 12th grades can participate in music production, automotive workshops, gardening, fitness and art while receiving meals, tutoring and emotional support.
Butler said the center’s impact extends beyond the number of teenagers it serves, describing how staff have watched young people overcome isolation, build confidence and develop relationships with caring adults.
“We have seen self-harm being replaced with self-worth, silence turned into sharing, isolation transform into connection,” Butler said.
The teenagers also participate in community service, including neighborhood cleanups, graffiti removal and delivering flowers to seniors and first responders.
Butler said the organization hopes to expand beyond Manteca and establish additional locations throughout San Joaquin County.
“Every teen deserves to know that their life matters, that their future is bright, and that they have the potential to become the next generation of leaders in this county,” she said.