Brown Warns on Aid Cuts: Don’t Expect State Rescue

Local governments got some bad news Wednesday from Assembly Speaker Willie Brown: Don’t expect any help from the Legislature to offset the impact of proposed federal cuts in aid to cities and counties.

Local officials have “worn out their welcome” in Sacramento, Brown said, by continually asking for a share of state revenue.

“I think we have done everything we should do for local government,” the San Francisco Democrat said at a breakfast session with The Times’ Sacramento Bureau, “and they ought to now use whatever authority there exists or request new authority from us to raise their own revenue . . . .

“They want us to do the taxing and then they do the spending, and that has created a bad flavor.”

Brown’s comments came just a day after local government officials were in the Capitol trying to lay the groundwork for more state aid if Reagan Administration budget cuts are implemented.

Estimates are that California cities would lose $563.3 million next year under the Administration proposals, and that counties would lose at least $336.7 million. The city and county of Los Angeles combined would lose more than $100 million a year in federal revenue-sharing funds that are currently used to support ongoing government programs, including libraries and parks.

Los Angeles County Board of Supervisors Chairman Ed Edelman, advised of Brown’s remarks, said the county recognizes that obtaining more state funds will be “tough going” but suggested that Brown might just be engaging in “hyperbole.” He said local governments “have nowhere else to go for help if those (federal) cuts go through.”

Edelman’s sentiments were echoed at Los Angeles City Hall. City Administrative Officer Keith Comrie said reluctance to provide more local government assistance is “consistent with the past.” Before voter approval of Proposition 13 in 1978, he said, legislators told local officials not to depend on their help. “But after the dust settled and they saw the impact of what would happen,” he said, “they did come in and help.”

The Legislature made up for the loss of local property tax revenue from Proposition 13 with a succession of bail-outs from state revenues, but lawmakers moved last year to give local governments a stable and permanent source of money through a fixed share of various fees and taxes.

Brown told The Times there is “no sentiment” among the Assembly membership to do more and said local officials have “hurt themselves and continue to hurt themselves” by asking for a “free shot” at state revenues.

Support for Rebate

The Speaker also said there is support among his fellow Democrats in the Assembly for a rebate to taxpayers next year if the state surplus continues to grow and that Democrats hope to be in the forefront of election-year rebate legislation.

Although Republican Gov. George Deukmejian has consistently said he has no plans for an election-year tax cut, Brown said he believes the governor “will have some sort of a rebate proposal” if the economy continues to boom and “we’re sitting on top of $2 billion or so in surplus.”

He said any Democratic package probably will encompass controversial efforts to repeal the unitary tax, under which the state is allowed to base a multinational firm’s tax liability on a combination of worldwide income and assets.

Some legislators have been fearful that repealing the unitary tax would open them up to criticism that they were favoring big business. The hope is that making an across-the-board tax rebate a part of the package would blunt any such criticism.