O.C. Officials Critical of Plan to Cut AFDC

Despite what could be nuggets of good news about relieving overcrowded jails and schools, some Orange County officials sharply criticized Gov. Pete Wilson’s first budget Thursday, saying it would push poor people toward ruin and saddle local government with huge new responsibilities.

In particular, county officials zeroed in on a proposal to trim state support for Aid to Families With Dependent Children, a subsidy program that helps pay expenses of poor families. Under Wilson’s budget proposal, AFDC recipients would face a 9% cut in their checks, dropping them to an average monthly payment of $633 in a county where housing prices remain exorbitant.

The number of Orange County families receiving that benefit has skyrocketed in the last year, driven up by the slowdown in the economy and new waves of immigration.

“These are people who are on the edge,” said Bob Griffith, chief deputy director of the county’s Social Services Agency. “This reduction will create a significant hardship for many of our clients.”

Don R. Roth, chairman of the County Board of Supervisors, agreed. “Things are pretty tough for people receiving that money right now,” he said. “They’ll get a lot tougher.”

Griffith was especially critical of one aspect of Wilson’s cuts to AFDC, which would eliminate benefits to families where both parents are in the home and out of work. That program, which includes more than 3,700 Orange County families, was intended to keep couples together: If only single parents can get AFDC, Griffith noted, it creates a financial incentive for poor couples to divorce so that at least the single parent can receive public assistance.

“Is that really what we want?” he asked. “That’s a tough decision.”

The proposed AFDC cuts topped the concerns of many county officials, and they, along with local education leaders, spent the afternoon scrambling to learn more details about the broad-ranging budget package. Even at first glance, officials agreed that the proposals, if enacted, could have important implications for local schools, public health and mental health programs, jail expansion, drug treatment and--above all--taxpayers.

Some local programs will benefit, but poor people and others will feel the sting: Administrators at local colleges and universities predicted that they would have to cut staff, increase class sizes and limit their incoming freshman classes to make ends meet.

Although UC Irvine officials still had not had a chance to sort out the details of how their budget would be affected by the governor’s proposal, William Parker, assistant executive vice chancellor, predicted that if it were enacted it would force a round of serious reductions.

“We think we can accomplish the reductions in staff through early retirement and attrition,” he said. As to the rest, he added: “We have to figure out how to minimize the impact and distribute it equitably around the campus.”

Students, meanwhile, will pay 20% higher tuition costs.

“We can barely afford it as it is,” complained Cal State Fullerton senior Faith Kruger, 25, of Placentia, who works as business manager of the campus newspaper. “It’ll be a real hardship, and I think a lot of students will have to drop out.”

Although the early budget reviews were decidedly mixed, a few suggestions did win tempered praise. One element of the Wilson proposal, for instance, suggests that county voters be allowed--by a simple majority--to approve new sales taxes for drug prevention and treatment services or crime suppression, including jail operations.

Under current law, such a tax might require two-thirds approval, making it all but impossible to win at the polls in conservative Orange County.

Wilson also pledged to seek a constitutional amendment to allow local governments and school boards to issue bonds for building schools and jails as long as they received the backing of a majority of the electorate. Like most sales taxes, most bonds also currently need two-thirds approval--a requirement established by Proposition 13, the landmark 1978 tax-cutting initiative.

Educators and most county officials agree that jails and schools are badly needed in Orange County. Thousands of schoolchildren are forced to use portable classrooms, and inmates are crammed into overcrowded cells even as thousands more prisoners are released early every year to make room in the jails.

New construction, however, has been hampered by the two-thirds requirement. The more relaxed laws would make raising new revenue easier and could help clear the way for new schools and jails, officials said.

“On the surface, the concept looks very inviting to me,” said Sheriff Brad Gates, who has led the charge for construction of a massive new jail in Gypsum Canyon, near Anaheim. “I’m very encouraged that the governor is moving this quickly to address these problems.”

Education officials were equally pleased with that part of the budget package.

“I think what the governor has done is a tremendously positive step in absolutely the right direction,” said Peter A. Hartman, superintendent of the Saddleback Unified School District.

While the tax reform proposals won praise, county officials nevertheless remained concerned about the overall impact of Wilson’s budget proposals.

The county was severely burned by last year’s state budget, which left them facing a shortfall that topped $46 million. With that struggle still fresh in their minds, many county leaders suspected that some aspects of the new budget could hold hidden costs.

“I don’t see all this working out well at all,” Supervisor Roger R. Stanton said. “It’s kind of like somebody shoving a very, very hot potato in your hands and saying, ‘Here, aren’t you pleased?’ ”

One Wilson proposal in particular--the suggestion that public health and mental health programs be transferred to the local government--raised eyebrows among county leaders.

That proposal would clearly benefit the state by freeing it of responsibility for managing two areas that have experienced a sharp increase in demand. But its effects on the county government--and on the poor and middle-income residents who take advantage of the programs--were harder to discern.

The governor said counties would receive new motor vehicle and alcoholic beverage tax revenues to pay for taking over the services.

Orange County residents will pay their share of those new fees. Although no specific figures were available Thursday, Wilson made it clear that he had many Porsche and Mercedes-Benz owners in mind when he proposed this scheme.

“It will hit most heavily those who buy the most expensive vehicles,” he said at a morning press conference.

That fee, combined with a penny-a-drink tax on alcoholic beverages, will produce an estimated $970 million to pay counties the cost of administering the public health and mental health programs, state officials said.

But some officials were suspicious: “It’s not going to meet those needs,” said state Sen. Marian Bergeson (R-Newport Beach).

“They’re very quick to transfer these things out of county government,” Supervisor Roth added. “We need some assurances that they will fund the program, though, or else we’re going to be stuck.”

And Supervisor Gaddi H. Vasquez, who takes over as the board’s new chairman next week, said he will press the state for a commitment to fund those programs before the county will agree to take them.

Above all, county and education officials cautioned that the new budget proposal will take days, perhaps weeks, to fully understand. And many are braced for a host of potential drawbacks that they fear could become obvious once the budget is subjected to closer scrutiny.

“My experience with state budgets is that you have to be very careful about making early judgments,” said Murry Cable, the county’s assistant administrative officer. “They’re kind of like a Trojan horse: you don’t really know what you’re getting until you look inside.”

Times staff writer Kristina Lindgren contributed to this report.

AID PROGRAM FACES CUTS

Among those who would be hardest hit by Gov. Pete Wilson’s budget proposal are Orange County’s poorest residents--those who receive Aid to Families With Dependent Children.

Some facts about the program:

67,500 people in Orange County receive AFDC, up from 55,500 in 1989.

Benefits now average $694 per month. Under the Wilson proposal, that would drop to $633.

In May, 1990, about 3,700 families were eligible for a special program that provided AFDC to households where both parents were living and unemployed. That would be eliminated in Wilson’s proposal, cutting $2.8 million a month.

Orange County received about $10.1 million a month last year for AFDC; that would drop to $9.2 million.

Source: Orange County Social Services Agency and state Department of Social Services.