The California Budget: Local Impact : Cuts Could Be Costly, Assessor Says : County: If his office loses a proposed 25% of its budget, Hahn warns, millions in tax revenues won’t be collected.

County Assessor Kenneth Hahn said Thursday a tentative plan to slash his department’s budget by nearly 25% will end up costing the county and other local governments nearly $200 million in lost tax revenue over the next few years.

In a pitch to spare his department from the county’s budget ax, Hahn argued in a letter to the Board of Supervisors that a proposed budget cut of $22 million will force layoffs of at least 358 workers--nearly a quarter of his office’s 1,700-member work force--who prepare property assessments and perform other functions necessary to collect taxes.

If the work does not get done, Hahn said, nearly $18 billion in property-tax assessments will not be processed, which means that more than $180 million in taxes will not be collected over the next two to four years.

Supervisors, monitoring state budget developments in Sacramento, could not be reached for comment. Some county officials said privately that the assessor’s bleak scenario may be exaggerated.

But Chief Deputy Assessor Gary Townsend said: “We don’t think we’re crying wolf, and it will be an expensive proposition to see if we are.

“You can’t get blood out of a turnip, and we can’t do our job without people,” Townsend said.

The proposed cut would reduce the assessor’s budget to $72 million from $94 million, according to county budget figures.

“We want to do our job on the minimum income, but still have enough to do our job,” Townsend said.

Los Angeles County would suffer the largest share of lost taxes, Hahn said. The county would lose $75 million in revenue, the city of Los Angeles would lose more than $21 million and the Los Angeles Unified School District more than $16 million, Hahn estimated.

Other cities, school districts and special districts, including Community Reinvestment Act districts, would also suffer multimillion-dollar losses.

Hahn said some of the taxes could be recouped in later years, but only at a much greater expense to the county.

“It is well documented that it takes longer and is more expensive to process the work deferred from a prior year,” Hahn told the supervisors in his memo. He noted that the deferral of assessments to later years also would increase the costs of doing business for the county auditor-controller and the treasurer-tax collector.

Worse, Hahn said, “if this deferral continues, the four-year statute of limitations will cause loss of property tax revenue, not just deferral.”

Townsend said the assessor’s office is continuing to meet with county budget officials and the supervisors “to see if we can minimize the damage.”

“We realize we have to take some cuts,” Townsend said. “But we’re optimistic that the supervisors will understand that if they cut us too much, it will have an effect on revenue.”

Still, some supervisors’ aides said there are hard feelings between the board and the assessor over Hahn’s unilateral decision earlier this year to automatically lower assessments on many properties purchased after 1988 by 5% to 25% because of the continuing real estate slump.

The decision cost the county tens of millions of dollars in tax revenue.

“I don’t think that will affect (our negotiations),” Townsend said. “I think most of the supervisors understand that was the right thing to do.”

Virtually every county department is suffering deep budget cutbacks this year, as the county’s revenues are down by more than $1.6 billion. Nearly $300 million of that shortfall is because of the Legislature’s decision to shift some property-tax revenue from local governments to school districts. The rest is attributed to the effects of the lingering recession on sales and property taxes.

Under the budget tentatively approved by supervisors on Tuesday, more than 9,500 of the county’s 80,000-member work force would be laid off.