Fair or not, as he leaves Sacramento, County Executive Terry Schutten will be remembered most for his last disastrous year at the helm of county government. His performance during the current budget crisis has been dismal. As the county sank into the fiscal dark hole from which it has yet to emerge, Schutten mostly dithered, delayed and denied.

While other local governments moved quickly to negotiate concessions with their unions or cut expenditures and reduce work forces, Sacramento County persisted in the fiction that the crisis would pass and revenues rebound. Instead, property tax revenue dropped 8 percent and sales tax revenue fell by 14 percent.

Clearly a global recession, the collapse of the housing market and deep cuts in state support, all factors beyond Schutten's control, contributed to the county's economic woes. But overspending by the county, particularly for salaries and pension benefits, added to the pain. Under generous formulas approved during Schutten's tenure, many recent county retirees will earn more in pensions than they did when they worked, while their former co-workers face layoffs and furloughs.

Schutten is not solely responsible for the overspending. Pushed by politically powerful public employee unions, Sacramento supervisors failed to hold the line, approving labor contracts that the county could not afford. As they launch their search for a new executive, supervisors need to accept some harsh realities about the limits of county government. Its current structure is unsustainable.

Sacramento County cannot continue to supply municipal-level services, primarily garbage collection and police protection, to the 40 percent or so of county residents who don't live in cities. Densely populated urban neighborhoods in the unincorporated county, such as Arden Arcade, Carmichael, North Highlands and parts of south Sacramento, should either incorporate – that is, form their own cities – or be annexed to existing cities that they border.

In the past, supervisors have resisted such action. That's no longer a wise or even viable position. Given the high cost of government and falling property values, many of these communities no longer generate sufficient property tax to pay for the kinds of municipal services residents expect and need. The new county executive should actively encourage incorporations or annexations where that makes fiscal and governmental sense.

In addition, the county needs a new executive willing to emulate some of the innovative service delivery models the county's recently incorporated cities have adopted. For example, he or she should consider partnering with private entities to reduce direct county delivery of services.

Can private companies collect residential garbage, maintain parks, perform building inspections, do planning and other services more efficiently and at a lower cost than county employees? Can private for-profit or nonprofit agencies better deliver health and mental health services?

Sacramento County is not the same place it was when Schutten arrived a decade ago. An economic crisis is forcing governments at all levels to rethink what services they can reasonably continue to provide and how best to provide them. The county needs a new chief executive who can adapt to the new reality – and supervisors willing to let him or her do it.