Candidates talk about financial issues

The Times asked the two major candidates competing to succeed Los Angeles County Supervisor Yvonne B. Burke about some key issues in the 2nd Supervisorial District, which stretches from Mar Vista through South Los Angeles and into Compton and Carson.

Today, Los Angeles City Councilman Bernard C. Parks and state Sen. Mark Ridley-Thomas (D-Los Angeles) offer their take on the county’s financial picture.

This is the last in a series before Tuesday’s election.

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County officials have proposed a $21.9-billion budget for the coming fiscal year that is 2.61% lower than the current budget but calls for no layoffs or major program cuts. If threatened reductions in state and federal funds require big reductions in county spending, where would you cut, and what services should get priority?

Parks: More often than not, the state and federal mandates are not fully funded. County programs ranging from substance abuse and crime prevention programs to Medi-Cal provider rates suffered a loss of $25.9 million when the governor and Legislature tried to balance the state’s current-year deficit in February. The governor’s proposal to balance next year’s budget would reduce the county’s funds by an additional $332 million.

At the federal level, the county faces a loss of $240 million in Medicaid revenue [and likely] substantial reductions to health, community development, justice, homeland security and social programs administered by the county.

Where a state or federal program requires a local funding match, reductions by the county should generally correspond to the state or federal program that is cut. Priority protection should be afforded those programs that are part of the basic safety net of services, such as child welfare services, food stamp administration, adult protective services, homeless services, mental health services and foster care.

The county itself is entering a precarious fiscal time. The county also has upward of $20 billion in unfunded liability obligations in pension and retiree healthcare costs.

The county must implement new budget policies, similar to those I proposed and implemented in the city of Los Angeles and the MTA. They are: (A) create a multi-year timeline to monitor and eliminate the existing structural deficit; (B) eliminate deficit spending programming; (C) eliminate the creation of ongoing programs that do not have a specific source of ongoing funding; (D) establish specific funding priorities for core responsibilities and obligatory expenses like public safety, prevention and intervention programs, infrastructure maintenance and upgrades, personnel health plans and pension contributions, etc.; (E) minimize or eliminate spending one-time monies on multi-year projects; (F) eliminate or minimize borrowing money to meet operating expenses or incur deficits and then borrow money to pay it off; (G) establish debt policies and a debt-ceiling percentage; (H) establish a reserve fund percentage with specific designations for declared emergencies, contingencies and budget stabilization funds; (I) establish mutual gains bargaining in future employee contract negotiations; (J) establish full cost-recovery policies for county services where appropriate; and (K) ensure that all contract services and grant applications have full recovery for both salary and administrative overhead.

Ridley-Thomas: If threatened reductions in state or federal funds trigger a need to make sizable cuts at the county level, I would work to make public safety, health services, foster care and delivery of municipal services to the unincorporated county areas of the district my priorities for funding.

No matter how deep any proposed or potential cuts may be from another level of government, L.A. County must always be in a position to tell its residents, “We will do our utmost to fulfill our county’s obligations to keep you safe from harm and protect your property 24 hours a day, seven days a week.”

Before specific program cuts are contemplated, comprehensive budget reform at both the state and local level that reevaluates revenue sources and expenditures, and realigns funding streams to services provided by each level of government, must take place.

We must pursue a strategic approach to budgeting issues that should include the formation of public-private partnerships to lessen the strains on county funding.

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Under what circumstances, and for which services, would you be willing to ask voters for a tax or fee increase?

Parks: The county’s fee structure needs to be evaluated annually . . . to assure that the fees charged by the county are properly aligned with the costs of providing the service, assuring the full recovery of costs for services.

The county’s concession agreements also warrant periodic review to assure that the county is getting a fair return on third-party operation of its golf courses and airports and beach and marina concessions, for example.

The county must establish internal systems to monitor and recover all fees and accounts receivable . . . to ensure all funds due to the county are recovered. The county must install new parking meter technology [and] must evaluate increases in parking citation revenues and illegal sign enforcement to determine how they rank in a general regional comparison.

I do not foresee a need to raise taxes to meet county operating expenses.

Ridley-Thomas: Those who suggest that taxes or fees not be raised under any circumstances do not appreciate that we may all be a major earthquake away from the need for extraordinary measures or significant shifts in priority.

If the county were faced with a financial crisis that threatened to force the closure of Harbor/UCLA Medical Center due to the prospect of draconian cuts to our health services system, I would ask the Legislature to give the Board of Supervisors the immediate authority to ask voters to approve a county ballot measure creating a County Health Authority Special District with revenue-raising capability; but I would want it to be subject to vigorous auditing mechanisms to root out fraud, waste and abuse within the county Department of Health Services. That is why I supported passage of Measure B to help finance the trauma and emergency services network and avoid its collapse.

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With slowing growth in property and sales taxes, what tools would you use to add revenue to county coffers?

Parks: The county must adamantly oppose state raids on city and county resources.

The county and Southern California as a whole are typically shortchanged in the allocation of state bond monies. The county can benefit financially by more aggressively insisting, with the support of its state legislative delegation, on the equitable distribution of state bond funds. I also think the county can do a better job of taking advantage of state and federal grant-funding opportunities.

The county must also be diligent and persistent in recovering money it is owed in fines, property taxes and concession fees. The county can also generate revenue by reining in costs. An example of an opportunity to do that exists in the fact that the county has not put out a competitive Request for Proposals for healthcare coverage for its 150,000 employees and retirees in years, simply bargaining with the same group of providers year after year.

The county must invest in the latest technology and software to ensure that their reserve fund investments are returning the greatest available interest rate to its general fund. The county should consider participation in naming rights, franchise fee and advertising opportunities that would create new revenue streams.

To assure that county departments are structured as they should be for the respective services they provide, to assess whether the respective services of the departments are logically cross-fertilized and integrated, and to satisfy ourselves that taxpayers are getting good and efficient service for their money, I will work for an independent performance review of all county departments within . . . my first term in office.

Ridley-Thomas: Small businesses are the economic engine of our county. My plan is to bring more jobs and business to L.A. County. I will insist that county departments responsible for issuing business licenses, conducting inspections and processing applications and permits do so in an efficient, accessible and customer-friendly manner and that complaints and/or disputes are handled with the care, respect and attention to detail successful small businesses provide to their customers. I further intend to develop partnerships between businesses, communities and the county, to leverage public resources with private funds to generate urban revitalization projects that will create additional jobs.

Following this business development road map as an L.A. City Council member enabled me to bring $500 million in economic development and housing projects, and 2,800 new jobs, to the city’s 8th Council District over a 12-year period. With the right kind of leadership, the same accomplishments can be attained at the county level.

I will also continue my advocacy of reviewing state tax expenditure policy. The $6 billion in corporate tax loopholes, exclusions, exemptions and credits provided to special interests by the state has an impact on local revenue. These should be evaluated to determine their continued effectiveness, need and impact on the local economy.

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On latimes.com

Candidates forum

These answers have been edited for space reasons, but the full responses appear at

latimes.com/california.