$6-Billion County Budget Calls for Medical Aid Cuts

Los Angeles County fiscal officials unveiled a $6.2-billion budget Monday that recommends a substantial cut in medical services for indigent adults, and urges an increase in staff for the newly formed Department of Children’s Services.

The 1985-86 budget was announced by newly named Chief Administrative Officer James C. Hankla, who said it is “precariously balanced--teetering on the brink of imbalance.”

Hankla said the budget proposal contains no surplus and no plans for employee wage increases.

The proposal--which represents a 3.2%, or $196.7-million, increase over this year’s final spending plan--is contingent upon the failure of efforts, on both state and federal levels, to slash aid to local governments. If those efforts succeed, Hankla said, the county’s budget would have to be re-evaluated.

In part because of this uncertainty, Hankla said, the county “is on the verge of a fiscal crisis.”

Increased Demands

Hankla said there have been increased demands for county services, along with steady losses in operating revenues, which mean that the county “is not on the proper side of the inflation curve.”

He blamed the grim fiscal news on a failure of state legislators. The state, Hankla said, has continued to mandate programs such as care for medically indigent adults, which the county must administer. But the state has not provided sufficient funds to do so.

As a result, Hankla said, the budget proposal recommends a $10.7-million cut in the program that provides non-emergency dental, pharmacy and ophthalmology services for needy adults.

Public hearings on the budget are scheduled for June. Then it goes to the Board of Supervisors for a vote.

“Right now this budget is dedicated to what the state of California perceives to be the needs of the county,” Hankla said.

Hankla said Los Angeles County officials have begun pushing for a “legislative moratorium” in Sacramento to ban any new programs that might cause the county to slip into the red ink.

‘It Is Ironic’

“It is ironic that I must present a bare-bones budget for county services while cities and the state as a whole are experiencing economic expansion and building reserves,” Hankla said. “It is doubly ironic that the state’s current robust economy is due in great part to the economic importance and prosperity of Los Angeles County.”

The downbeat Hankla forecast was in contrast to the generally upbeat message presented by county supervisors last year when they said that, for the first time since voters passed Proposition 13 in 1978, fiscal constraints facing the county were over.

Hankla said that a $33-million budget reserve included in the current year’s budget has been spent. In addition, the county has slipped $19.6 million into the red because of an increase in services to the poor and jail construction cost overruns. But Hankla said that additional revenue collections will probably erase that deficit by the time the 1985-86 fiscal year begins July 1.

Hankla’s warnings that dire times may be ahead were keyed to prospects that federal revenue sharing funds--threatened by congressional and Reagan Administration attempts to eliminate the federal deficit--could result in a $60-million loss to the county.

Extra $17 Million

County officials would have to find an additional $17 million if the state adopts a plan backed by Gov. George Deukmejian to make California’s counties share equally the cost of foster care programs, Hankla added. Currently, the state picks up 95% of the cost with the counties paying the difference.

The county budget proposal calls for an increase of about 600 employees, which would bring the county’s authorized work force to 72,495.

Most of the new positions--342 in all--would be assigned to the newly created Children’s Services Department for increased staffing at MacLaren Children’s Center, for help in recruiting foster care parents and for help in meeting projected increases in placements of children up for adoption.

Other staffing increases recommended by Hankla were for the Sheriff’s and Probation departments and the district attorney’s office.

Hankla’s recommendation that the county’s employees receive no pay increase is likely to generate much controversy as negotiations with the various unions begin next month. The employees grudgingly accepted no pay boost two years ago with only a modest increase last year.

Asked what reception the unions would likely give to his proposal, Hankla said that after they analyze his budget projections, union leaders will realize that the no-pay increase is “reasonable under the circumstances.”