Officials in O.C. Sifting Budget for Bad News

Hours after Sacramento brought the state’s budget crisis to a close, government leaders here Wednesday began the daunting task of figuring how deeply the damage will be felt in Orange County.

The initial assessment: heavy cuts all around, with no one certain how much it will cost residents in higher fees or reduced services.

“Everybody at this point is just kind of numb,” said William Hodge, head of the Orange County branch of the League of California Cities. “Some (city leaders) have just thrown up their hands. This is not any way to run a government.”

School officials countywide expressed guarded relief Wednesday that districts will get roughly as much money this fall as they did last year. But they predicted dramatic cuts in the 1993-94 school year as the state takes back funds which have been declared “advances.”

Elsewhere, however, the cuts will come this year, as state legislators raided Orange County governments and agencies for tens of millions in property taxes and redevelopment money used to fund such essentials as police and fire protection, street maintenance and health care.

The cuts were generally smaller than had been feared several months ago, but officials said their impact will be felt countywide. For instance:

* County government is expected to lose more than $37 million in state funding, although a key proposal that would have cost the county $8.9 million in delinquent tax penalties was axed from the final budget plan.

* Cities in Orange County stand to lose a combined $42.1 million in property taxes and redevelopment funds to the state, sapping them of what many said are critical revenue sources.

* Special districts in Orange County--responsible for services ranging from garbage collection and water to fire protection and flood control--will lose more than $47 million. That amounts to up to 40% of their respective budgets, meaning a near-certain rise in many local user fees.

* About 80,000 people in Orange County who rely on Aid to Families with Dependent Children will see average cuts of about 4.5%. For a mother with two children, that amounts to $30 or more cut from a monthly check of $663.

“Nobody’s going to have anything,” the mother of a 7-month-old daughter said Wednesday as she waited at a social services center in Santa Ana. “We’re all going to be broke.”

* And some 6,100 elderly and disabled people in Orange County who rely on in-home workers for a variety of household chores will have support hours cut by 12%.

“If they cut down our hours, what are we supposed to do?” asked Charlie Saladino, 82, a Huntington Beach resident who relies on an in-home worker to help him almost every day with shopping, laundry, doctor’s appointments and other work. “That’s all some of us have.”

* Orange County courts will see their state funding cut by at least $6 million and perhaps as much as $15.2 million. Local officials hope to make up some of this through higher fees for court filings.

As relieved as local people were on Wednesday to finally have a completed budget, they were plenty mad too.

And much of the resentment was aimed at Sacramento.

“When I see the money, then I’ll believe it,” said B.J. Bendorf of Huntington Beach, an in-house support worker whose state paycheck was cut off during the budget impasse. “I think they’re all rotten up there--they’re so busy making money themselves, they’re not thinking of what they’re doing to the people.”

Orange County Supervisor Gaddi H. Vasquez predicted that such attitudes will be hard to shake. “The lingering process that we’ve all witnessed for the last 60-plus days has created a very high negative (perception) . . . of the whole institution of government,” he said.

Orange County Municipal Court Executive Officer Robert B. Kuhel quipped that “we figure since it took them 63 days to pass (the budget), we’ll take 63 days to implement it.”

William O. Talley, a former Orange County city manager who now advises cities, described the budget agreement as “nothing short of abdication of their job. What (the legislators) have done is to make the cities and the counties in California do their dirty work.”

Two dozen city executives who attended a closed meeting Wednesday in Orange of the local League of California Cities had few firm statistics on the budget’s local impact, but the available numbers appeared grim.

Cities will lose 9% of property tax revenue. Never before has the state taken a share of local property taxes, and league officials estimate revenue losses of $17.1 million in this area alone.

The state will also raid the cities’ redevelopment agency funds. Those cuts will amount to 17% per city, or a total of up to $25 million.

And cigarette tax money, once apportioned to cities by the state, was long ago surrendered during the protracted budget negotiations. In all, the losses countywide could total several million dollars, with Santa Ana the big loser at $500,000.

In Anaheim, where projected cuts were pegged at $4.3 million, officials were predicting even leaner years ahead for California and Orange County.

“We do not see the state’s fiscal crisis as just a one-year thing,” City Manager James D. Ruth said. “This situation will be with us two, three or four years down the line.”

Ruth said the bad news could force the city to consider shorter workdays for its employees and further reductions in travel budgets and other programs or personnel.

While many city leaders were hunting means of plugging anticipated holes, the city of Orange was already touting a multipronged strategy to absorb more than $2 million in anticipated cuts. If approved by the City Council and city employees’ unions, it would take effect Sept. 11.

The proposal includes closing City Hall every Friday and placing the 380 non-public-safety employees on nine-hour workdays, Monday through Thursday. The move amounts to a 10% pay cut for workers.

Also, city employees will be asked to take all their vacation time and compensation time instead of converting it into cash.

“If approved, the council will promise not to lay anyone off until June 30, thus giving employees job security for 10 months in exchange for what they’re giving up,” said Scott Morgan, senior assistant to the city manager.

How bad is it?

“Real bad,” Buena Park City Manager Kevin O’Rourke said. “I have already cut millions from the city general fund budget and now I have to return to my office and look for another $500,000 to trim.”

Hit especially hard by the state funding drought were special districts.

The Orange County Sanitation Districts, for instance, which serves 2.1 million people in 23 cities, expects to lose up to $13.7 million--or about 40%--of its property tax revenue. That will probably mean increases of $11.15 to $42.45 annually for users, bringing the top garbage fee to $117.45, said the agency’s general manager, Wayne Sylvester.

Considering that the governor had originally proposed taking all property-tax monies from special districts, Sylvester said, “some might say we’re getting off OK. . . . But why should (state officials) take more from local government simply because of their own inability to balance the state budget?”

Officials at the Orange County Transportation Authority, meanwhile, were livid about the budget plan because the county is one of only three statewide that were singled out for reductions in property tax revenue set aside for bus service. The others are Santa Barbara and San Joaquin.

The budget reduces by $3.2 million--or 35%--the $8 million in property taxes earmarked for bus service under the OCTA. And it would allow the state to take another 5% next if year if needed.

OCTA officials said they hope to absorb the losses without reducing service.

But OCTA member Dana Reed said, “We are by far the biggest losers in this. . . . (Assembly Speaker) Willie Brown exempted his constituency and stuck it to us. I have to assume this is a pay-back for the Republican majority in Orange County.”

The county’s library district and Fire Department also lost out in the budget battle, each standing to lose close to 10% of their state property-tax money. That amounts to up to $8 million for the Fire Department and $2.6 million for the libraries.

Officials had speculated early in the budget process that such deep cuts might force the closing of fire stations or libraries, but county officials say now that they do not expect that to happen.

“That’s the kind of talk that always comes out at budget time,” said Sandy Ward, chief of staff to Supervisor Harriett M. Wieder. “But I really think the fire stations would be the last to go.”

Instead, County Fire Department spokesman Fausto Reyes said, the department hopes to absorb its losses through a continued hiring freeze and other internal measures.

But officials caution that they will not know the full impact of the cuts for weeks--until they have a chance to read the budget in detail.

Just late Wednesday, for instance, the county’s Sacramento lobbyists notified County Budget Director Ronald S. Rubino of a little-noticed veto by the governor: He had apparently slashed an additional $205 million statewide for trial courts, more than doubling the previous cut, Rubino said.

While details of the move were unclear, Rubino said it would jump Orange County’s court losses from about $6 million to more than $15 million. “This is a major problem if it’s true, a major problem,” he said.

Conceded Superior Court Administrator Alan Slater: “There’s just no way to know how it’s going to affect us. I’m having trouble getting the straight scoop . . . (and) I’m hearing 10 stories about everything.”

Times staff writers Gebe Martinez, George Frank, Matt Lait, Maresa Archer, Jodi Wilgoren, Leslie Earnest and Jeffrey A. Perlman contributed to this story.