Irresponsibility in Funding

Many California counties face budget crises this year because the state has continued to mandate county services without providing funds, has not fulfilled its full commitment on assuming court costs and, in at least one specific case, has reneged on a written agreement settling an audit dispute.

Gov. George Deukmejian and the Legislature share the blame. But it is the citizens who will suffer the consequences of their irresponsible parsimony. The situation provides fresh evidence of the counterproductive effect of the Gann initiative that sought to control state spending through a flawed formula.

In Los Angeles County the outlook is bleak indeed, and it will be a good deal bleaker if voters do not approve Proposition 99 in November. The county’s Department of Health Services budget is based on receipt of more than $40 million in the current fiscal year in revenue from the increased cigarette tax proposed in that initiative.

Richard B. Dixon, chief administrative officer of the county, has laid before the Board of Supervisors the unpalatable options as they face a potential shortfall of $96.6 million. The cuts include reduced fire and sheriff protection and a 40% cut in public recreation, and that could be just the beginning. As Supervisor Ed Edelman said, “All of these proposed budget cuts are unacceptable in terms of the level of county services we need and should have.”

It is instructive to look closely at the budget for the county’s Department of Health Services. Under its terms, additional funds were provided, as they certainly should have been, to address the emergency-room crisis and the increasing costs of the AIDS pandemic. But those increases were funded by cuts in other services that will require a layoff of 70 persons. Furthermore, the increases were based on the assumption that Proposition 99 will pass. If it fails, the shortfall will be $41 million, forcing cutbacks instead of increases in critical programs--including the emergency-room and trauma-center network. In addition, the county’s mental-health services are operating at a cost that is $15 million above revenue under an injunction blocking proposed reductions--a deficit that eventually must be made by further cuts in other parts of the county budget.

The funding problems for health services dramatize the irresponsibility of the state. The budget would be manageable had the state lived up to county expectations growing out of the 1982 decision to transfer the care of medically indigent adults from state rolls to the counties. County officials assert that the state agreed to pay 70% of those costs but is currently funding only half the cost of the program in Los Angeles County. If the county was receiving full state funding for the program dumped onto it, it would have received $134 million more for the last two fiscal years and an additional $94 million for the current year. The state’s arbitrary attitude on financing was illustrated further in the Legislature this year when, to balance the budget, the legislators unilaterally cut $5 million from a negotiated agreement to pay $20 million owed to the county as a result of an audit.

In Orange County, key human services remain frozen, with the county dipping into reserves to avoid cuts in basic funding. In most categories there has been no money to increase programs. This process, repeated over recent years, has meant that indigent medical, welfare and general relief programs are not keeping pace with the growth in demand, bringing additional hardship to the county’s families.

Under the terms of Proposition 13, the voters of California effectively transferred the power of taxation to Sacramento. Under the Gann initiative, Proposition 4 adopted in 1979, that authority was truncated by a formula that has proved to be defective. But neither the governor nor the Legislature has been willing to address the crippled condition of the state’s funding, placing at risk the basic services as well as the quality of life in a state that was once proud of its public services.