Molina Accuses Board of Rubber-Stamping Budget

Los Angeles County Supervisor Gloria Molina recently posed a question that was so unusual, so unfamiliar that it actually made news, prompting one defensive board colleague to accuse her of grandstanding.

The newly elected Molina, polishing her image as the board’s populist rabble-rouser, asked her fellow supervisors how they possibly could approve a $12-billion budget--bigger than the budgets of nearly 40 states--in only two afternoons of debate and without scouring the books for possible fat.

That’s not how it’s done in Sacramento where, as an assemblywoman, Molina participated in bruising, round-the-clock budget deliberations. Nor is that the norm at City Hall, where Molina later served as a councilwoman and said she endured contentious presentations on the city’s finely detailed budget.

What Molina says she learned last month during her first budget session as a supervisor--and what critics have been saying for some time--is that the board exercises little control over department chiefs and mid-level bureaucrats who decide how to spend billions of dollars in taxpayer funds.

“I was embarrassed by the process,” said Molina, who accused the supervisors of being more concerned about divvying up money for pet projects than in ensuring the responsible use of public funds.

Although Molina’s colleagues dismissed her criticisms as observations of a novice, her remarks have opened a debate on how the supervisors have traditionally approached one of their most important jobs--and whether it’s time for some rethinking as tax dollars become increasingly scarce.

Molina and board critics contend that the supervisors’ quick vote on the budget raises questions about whether too much discretion is delegated to non-elected officials who set spending priorities and cannot be called to task by voters. In sum, they say, it’s a matter of accountability.

As Molina pointedly told the county’s parks director during budget deliberations: “You might have tiddlywinks contests going on. I don’t know.”

So entrenched is the status quo, according to Molina, that even she was unable to determine from county financial officials how much money departments plan to spend this year on travel, the kind of expenditure that has landed many an official in hot water.

Top county executives, including Molina’s colleagues on the board, argue that there is no value in convening marathon deliberations because fully 89% of the budget is earmarked for services mandated by the state and federal governments, including the courts, hospitals and jails. The county also is required to fund welfare payments, which accounted for $2.2 billion of the budget.

As a result, they insist, only about $1 billion is left. And much of that, they say, funds such things as the county’s beaches, museums and parks as well as the Fire and Sheriff’s departments.

“I remember when the board would carry budget sessions to 10 or 11 o’clock at night,” said Supervisor Kenneth Hahn. “It didn’t change one thing. You can only spend what money you have.”

This year, like every year, the supervisors began budget talks by wheeling a chalkboard into the chambers. On it was written the portion of the $12-billion budget that finance officials said was ultimately left unencumbered, the amount around which supervisors’ deliberations would revolve.

The sum: only $10 million. That triggered Molina’s public discourse on the role that she believes supervisors should play during budget deliberations.

While acknowledging that millions of dollars must be spent on government-mandated programs, she argued that the board should be investigating whether services are being efficiently administered. She speculated that the percentage of the budget consumed by these programs could possibly be reduced, freeing millions of dollars for under-funded programs, including those that have suffered deep cuts.

“Every aspect of the budget involves policy, and our responsibility here is to scrutinize that budget,” Molina said. “Are there better ways to achieve the goals that are mandated?”

Critics contend that the supervisors’ delegation of financial decisions may have led to misguided and wasteful spending over the years.

“It’s a total lack of accountability to the elected officials and the taxpayers,” said Guido DeRienzo of the American Federation of State, County and Municipal Employees. The bureaucrats, he said, “decide the priorities as opposed to elected officials.”

Last week, for example, DeRienzo disclosed that executives in the Mental Health Department spent $864,000 on office renovations after closing a number of clinics because of funding problems.

The department’s acting chief, Francis J. Dowling, explained that an unexpected surplus had been found and that 350 mid-level managers needed new, safer work stations. In response to Molina’s criticism, the department has suspended plans to spend another $783,000.

“Just because you have savings,” Molina snapped at Dowling during last week’s board meeting, “I don’t think you should put it into remodeling.”

One area in which the supervisors have delegated considerable financial authority is in how much money should be paid in out-of-court settlements to people who have sued the county’s overburdened hospitals for malpractice. The final word now rests with the county counsel and chief administrative officer.

During the last fiscal year alone, they approved settlements totaling $26 million, none of which came before the supervisors for approval or even review.

Calling the amount “astronomical,” Molina observed: “I don’t see anybody holding the health department accountable for that.”

The bottom line, she said, is that scrutiny of the malpractice claims by the supervisors might reveal correctable problems that could save tax dollars and, more important, protect the public from bad health care.

For the most part, the supervisors have dismissed Molina’s barbed questions and harsh assessments as the result of inexperience, although she did get them to consider drafting more detailed budgets in the future.

Supervisor Ed Edelman said that when he joined the board in 1974, after serving on the Los Angeles City Council, he also had trouble adapting to the county’s way of doing business. “You get used to the system,” he said. “Here, things get done quickly.”

Nonetheless, Edelman said he is receptive to spending more time on the budget. He also said a new elective office of “county executive” should be created to oversee financial operations and achieve greater accountability.

Supervisor Deane Dana predicted that, in time, Molina will find the system “quite efficient” and that “a newcomer should try to learn from the experts.”

Dana, Edelman, Hahn and Molina’s other board colleague, Mike Antonovich, all insisted that they do not have time to analyze every twist and turn of the multibillion dollar budget--nor should they.

“The whole budget is too big to do it in a micro-situation here in the board room,” said Dana. “Twelve billion dollars of expenditures have got to be worked out ahead of time. That is the importance of top-quality management, so we can get this down to a finished product that is workable.”

Antonovich added that the supervisors’ staffs studied the budget for weeks before the public vote. “What we have is the result of thousands of hours” of work, Antonovich said, adding that audits of county operations are conducted by the Los Angeles County Grand Jury, the Economy and Efficiency Commission and the county auditor.

Assistant Auditor-Controller Tyler McCauley acknowledged, however: “I don’t second-guess the guy who chooses this year to buy furniture. That is not our job. We’re concerned with accounting for the money and doing management audits for economy and efficiency.”

Under the current system, the man most responsible for the budget is Richard B. Dixon, the county’s chief administrative officer, who himself raised eyebrows last year by spending $2 million to renovate his office after privately informing the supervisors of his plans.

“We trust him to thoroughly go over every department budget so that when it is presented to us, there is no fat in it,” said Hahn, the board’s longest-serving member. “That’s why we pay him a good salary.” Dixon receives $169,520 a year and such perks as a chauffeur and county car.

In drafting the budget, Dixon and his budget staff of 100 allocate funds to departments based on “historical trends” and give them broad authority to spend the money as they see fit. They need only come back before the supervisors if budgeted amounts are exceeded.

One important spending rule for department heads, Dixon said, is “don’t embarrass the county.” Dixon noted that, if the supervisors don’t like the way money is being spent, they can fire department heads or deny them pay raises.

As government budgets go, the two-inch-thick document prepared by Dixon is thinner than most in size and detail. It lists expenditures only in broad categories, such as “salaries and employee benefits” and “services and supplies.” The latter category covers a wide range of expenses, from private consultants to paper clips.

In their own records, some departments keep detailed budgets. Some don’t.

In contrast, the seven-volume, $3.9-billion Los Angeles city budget package--one-third the dollar amount of the county’s but but five times as thick--details expenditures on furniture, printing and cars. There is even a breakdown of how much the Police Department anticipates spending on “ammunition and tear bombs.”

The budgetary vagueness also applies to the supervisors’ own $26-million office fund. There is no breakdown of how much each supervisor plans to spend on staff, office remodeling or cars.

AIDS activist Michael Weinstein said he concluded years ago that the county’s budget process needs reform, long before Molina was elected as a supervisor. He has long been pounding the bureaucracy to spend more money on prevention and treatment of the deadly virus.

He accused the supervisors of having a “circle-the-wagons” mentality and of feeling that “so what if a few less pregnant mothers got service or a few less AIDS patients got served. . . . I know of no other level of government that administers so much money under so little scrutiny.”

The man Molina replaced on the board, the cantankerous Pete Schabarum, agrees that the board does not flex its muscles.

“As far as I’m concerned,” he said, “there is one heck of a lot more latitude available than the members of the board now, and in the past, have chosen to exercise. These guys just rubber-stamped everything Dixon brought forward.”

Molina, who campaigned on the promise of opening up county government, said that a reform proposal she hopes to submit to voters will include recommendations to provide greater oversight of county spending, including establishing a committee system for the supervisors.

She insists that she is not “grandstanding,” despite what a few of her colleagues think. “Those are very unfair characterizations,” she said. “I am honestly trying to figure out how this budget works, and how we can implement more effective policy.”

Big Budgets

Los Angeles County’s 1991-92 budget of $12 billion is larger than most state budgets, but is still much smaller than that of New York City. Here is a look at L.A. County’s budget compared with other state and municipal budgets for 1991-92:

Region Budget California $55.7 billion New York 52.3 Texas * 46.5 Florida 29.4 New York City 28.6 Illinois 27.6 Ohio 27.2 Michigan * 18.4 Washington ** 15.2 Georgia 13.2 North Carolina 13.0 Virginia 12.8 Minnesota *** 12.4 L.A. County 12.0 Maryland 11.6 Indiana 10.3

* 1990-91 fiscal year

** Half of 91-93 biannual budget

*** 1992-93 fiscal year

SOURCE: State governments, L.A. Times

Compiled by Times researcher Michael Meyers