Budget Crunch Forces Counties to Cut Services

Times Staff Writer

The Shasta County Public Library was boarded up last week, the word "shame" scrawled angrily across a handbill announcing the closure. At the county hospital, the few remaining patients, indigents all, were being hauled away by ambulance--another institution gone down. And in the halls of county governance, the customary drowsiness of local bureaucracy had been replaced by currents of real tension, real confusion.

Short of cash, and of answers, the bureaucrats and politicians who run Shasta County have been hurriedly dismantling services long considered untouchable elements of county budgets throughout California. Beyond its library and hospital for the poor, the rural Northern California county (population 132,000) has contemplated abandonment of services ranging from its 4-H adviser to significant ranks of sheriff's deputies.

'Emptied Our Cupboard'

"All the fat is gone," Auditor-Controller Edward Davis said in an interview. "We are in very severe financial difficulty. . . . At our existing level of operations, which we feel are minimum to meet our responsibilities, our costs are exceeding our revenues. We have pretty much emptied our cupboard of reserves."

The crisis is not peculiar to Shasta County. Throughout the state's rural north, a verdant, sparsely populated sprawl of timber and pastureland, several counties have sounded sirens of fiscal collapse. Tehama County officials have forecast imminent bankruptcy. There has been talk in Plumas County of taking deputies off the roads at night. At least one county, Butte, has toyed with the notion of disbanding altogether.

While the crunch has been felt first in this region, where tax bases are small and local economies have followed the slumping timber industry, some officials contend that many of California's 58 counties are strapped for money, and there have been suggestions for a fundamental re-examination of how California provides services through a ziggurat of state, county, municipal and special district governments.

'Dramatically Wrong'

"All counties in a certain respect are depressed or distressed," said Victor Potorff, deputy director of the County Supervisors Assn. of California. "It is the institution of county government. Something is dramatically wrong and out of kilter here."

Potorff said, for instance, that parallels can be drawn between the Shasta County Library closure and the crumbling of Los Angeles County's trauma care system.

Most involved believe that the dilemma is more one of tax distribution than of tax collection. The point is buttressed by the fact that, even as several county governments claim to be on the brink, a property tax rebate of $1.1 billion is to be distributed statewide and Gov. George Deukmejian has salted away several hundred million in an emergency surplus fund.

The driving force behind the dilemma, according to officials here, is that the state government in Sacramento increasingly dictates how counties spend their tax revenues. More and more dollars are needed to meet the demands of new, state-mandated programs, primarily related to welfare and administration of justice, leaving less and less money for such so-called discretionary items as libraries.

Migration of Urban Poor

Although the programs are financed largely, and in some cases exclusively, with state money, many require counties to pitch in a small percentage. Officials here and in other small, rural counties maintain that these additional matching funds were enough to break their budgetary backs. Compounding the problem, they said, is a migration of urban poor to rural regions, where uniform welfare payments stretch further.

Such complaints from counties are not new. They started almost immediately after adoption of Proposition 13, the historic Jarvis-Gann tax initiative of 1978, which reduced property tax revenues and made it difficult for counties to raise property taxes.

With the closure of its public library system, however, Shasta County raised the rhetoric to a new pitch.

On its face, Shasta County's immediate budget crunch does not seem especially drastic.

County officials were confronted with a $2.6-million deficit, a seemingly tiny fraction of a $110-million budget. However, they said, nearly three-quarters of the budget was consumed by state-mandated programs. This meant cuts had to be found among the roughly $25 million worth of so-called discretionary items--essentially the Sheriff's Department, the county hospital and the library.

First Victim

The library was the first victim; the main library and its nine satellite branches were shut down Oct. 15. Forty-six employees were laid off.

The hospital was next, posting a notice last Wednesday that it would no longer admit new patients and taking steps to move the remaining patients to other hospitals by week's end. Many of its employees, anticipating the closure, already had left. Cuts in the Sheriff's Department were avoided this week, barely.

Last Tuesday, library Director John R. McCracken toured the all-too-quiet main library and its stacks of 250,000 books. The place was empty but for a janitor spotting the worn carpet, a lone researcher and, in back rooms, a handful of remaining employees processing overdue books and four adults reading aloud slowly as part of a literacy program, which has yet to be discontinued.

"Normally," McCracken said, "this would be story hour." He pointed to the children's section, where a dozen or so knee-high chairs were stacked haphazardly. "All these chairs would be filled." He moved to the research desk: "There would be a lot of activity here."

Gamble on Outrage

Surprisingly, McCracken himself proposed to supervisors last September that the library system be closed. Faced with another round of budget cuts, he was willing to gamble that outrage stimulated by the library closure--indeed, numerous letter writers to the Redding newspaper subsequently likened the move as a return to the Dark Ages--would translate into voter support for the establishment of a special library district.

A measure to go before voters Jan. 15 would ensure adequate funding of the system by levying a $24 per parcel annual fee on property owners. What permanent fate will befall the library if the measure fails is something supervisors are reluctant to speculate upon.

Right now, library advocates are laying it on thick. McCracken described the library as an irreplaceable "information institution," as a driver in "economic development," as a seam in "the very fabric of the democratic process," and his pitch had the practiced ring of a politician's stump speech. Similarly, there seemed to be symbolic political value in the sheets of plywood nailed over the library doors and window, the stern pronouncement "Library Closed" stenciled across the boards in black, as well as in the red slash through road signs directing motorists to the library.

Long Shot at Best

Advocates will need all the rhetorical flourishes and symbolic overkill they can muster. Passage of the library measure will require a two-thirds majority, and even the staunchest supporters of the measure believe that it is a long shot at best.

This county voted 2 to 1 in favor of Proposition 13 and, judging by the volumes of letters printed in the Redding Record-Searchlight, many residents believe that the taxes they already pay should be sufficient to maintain a proper library system. Others argue that it is unfair to ask property owners alone to foot the bill for libraries used by all residents.

The 57-bed Shasta County General Hospital is without any real political options.

Its patients are mainly from the ranks of the poor who cannot afford medical care--a clientele that in this conservative county is something less than a political powerhouse.

"They are very confused," Kathleen Wegener, the hospital administrator, said last Wednesday of the 14 patients who remained in the wards, many soon to be transferred to the town's two private hospitals.

Sense of Something Ending

On this day, the wards were all but empty. Throughout the 132-year-old hospital, there was a powerful sense of something ending. In the second-floor hallway, which in better times was alive with nervous relatives of expectant mothers, there was no activity other than farewells being quietly offered between two employees.

"Been nice working with you," a physical therapist in a white coat said as he shook the hand of the other employee. "What has it been, nine years?"

"Hell of a deal," the other man said as he headed out the door.

A court injunction against the closure had been obtained by a public interest law firm, which expressed concern that adequate steps had not been taken to ensure medical care for the county's indigent sick. The county closed Shasta General anyway, contending that it had deteriorated to the point where patient safety was compromised.

In the courthouse, which serves as administrative headquarters for the county, the pressure that a tight budget and unpopular cuts has placed on supervisors and bureaucrats alike was evident as they gathered to determine if even more budget trimming was needed.

Official Lambasted

Davis, the auditor-controller, informed the board that by altering accounting procedures, more than $700,000 could be wrung out of the budget to pay for closure of the hospital. Though his plan would forestall even deeper cuts in all departments, including the loss of 23 deputies, Davis was lambasted.

Supervisor Don Maddox emotionally described the "gut-wrenching decisions" that the board has been forced to make, his "many, many sleepless nights" and the "panic" that has overcome department heads. "Here is a potential solution that would have saved a lot of that midnight oil," he said. "This could have saved some of that anxiety. . . ."

When Davis angrily responded that he was not to blame and sought again to explain why the accounting procedure could not be employed to save ongoing programs, Maddox cut him off. "Don't get paranoid on me, Ed," the supervisor said, his beefy face a glowing red. "I'm not an accountant. I'm not an auditor. And I don't understand."

The hearing room was hushed.

Budgetary Crisis Management

While counties such as Shasta undergo tortuous crash courses in budgetary crisis management, others have begun to look for long-term solutions.

Assembly Speaker Willie Brown last month ordered a study of what he described as "our costly and outdated method for delivering services," suggesting that counties perhaps should be disbanded and replaced by larger regional entities.

"We do not have a rational system of local governments," Brown said. "What we have is a haphazard, random assortment of government bodies all fighting over the same dollar and all contributing to a service delivery system that is more of a crazy quilt than a safety net."

For his part, Gov. Deukmejian has promoted a "rural renaissance" program designed to bolster the local economies of smaller counties. He has also signed bills intended to help them squeeze through the current crisis, blocking one measure until changes were made to ensure that rural counties received their fair share of state funds. Perhaps most important of these is a bill that will shift trial court costs from counties to the state.

Politically Unfeasible

The governor, however, has declined Brown's call for a blue-ribbon commission to investigate whether counties have outlived their usefulness; a spokesman for Deukmejian said the proposal, while "interesting," appears politically unfeasible.

Many local officials advocate making the state pay for all its mandated programs. They talk of a statewide initiative to wrest back policy-making power lost as Sacramento extends its shadow more fully over their budget process. Others suggest, tentatively of course, that perhaps the time has come for taxpayers to reassess Proposition 13, to take stock of the services they expect from government and their willingness to pay for them.

"I really felt something such as Proposition 13 had to happen," Davis said. "But I really feel it was too drastic. And I think if the people really realized what they get for their local property tax dollars it would amaze them. . . . If you want a modern society, that's the cost."

For the Record Los Angeles Times Wednesday November 18, 1987 Home Edition Part 1 Page 2 Column 6 Metro Desk 1 inches; 29 words Type of Material: Correction A story on Shasta County's financial problems, which appeared Nov. 15 in The Times, incorrectly described the $1.1-billion state tax rebate as a property tax rebate. Actually, it is a state income tax rebate.
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