The Special Problems of Special Districts : Services: Consolidation of small agencies won’t solve them. A better-informed public might.

In the aftermath of recent media reports regarding the actions of several special districts, many people have suggested that consolidating the numerous water and waste-water districts in Orange County is long overdue. Unfortunately, consolidating several small, single-purpose agencies into larger, multipurpose districts will not, by itself, solve the problem.

While there are several potential benefits to be derived by consolidation, it would be a mistake to believe that reducing the number of districts will prevent similar abuses on spending and potential conflicts from occurring in the future.

The irresponsible behavior that has been identified by recent media reports has not been limited to small, single-purpose agencies. In fact, some of the most efficient and economical districts in the county are also among the county’s smallest districts.

The solution to these problems lies in a more interested and informed voting public that holds its elected officials accountable for their actions. While consolidation cannot make this happen, it can make the voters’ task easier.

By reducing the number of districts, the voters will have fewer elected officials and issues to monitor.

In addition, consolidations can provide the following benefits:

* Cost savings due to economies of scale, elimination of duplicative administrative positions and reductions in the number of district directors.

* Better planning and coordination between the agencies that make development decisions and those which must provide the services to newly developing areas.

But consolidations can also have negative impacts.

The economical, efficient and responsive manner in which many special districts operate may not be equaled by a large bureaucracy serving several hundred thousand customers. Furthermore, the customers within established areas resent having to pay off the debt for building facilities within developing areas, while the new residents oppose contributing to the higher maintenance costs within the older areas.

The responsibility for weighing the potential positive and negative impacts of consolidation, and in finding an acceptable middle ground, lies with the Local Agency Formation Commission. Only LAFCO, with the confirmation of the affected voters, can approve a consolidation, merger or dissolution of a special district.

It is important to note that LAFCO did not create this situation. While LAFCO does have the authority to approve the formation of new districts, none of the independent water or waste-water districts within Orange County were created by LAFCO. Each district existed at the time the commission was created in the early 1960s.

For the better part of the next three decades, many of these special districts provided a fundamental and vital service to residents of rapidly developing, unincorporated south Orange County.

During the late 1980s, LAFCO responded to the local control desires of many south Orange County residents by approving the incorporation of five new cities (Mission Viejo, Dana Point, Laguna Niguel, Laguna Hills and Lake Forest), forever changing the way local services are provided.

For several reasons, LAFCO has acted to begin a comprehensive review of special districts to determine if changes in the system are warranted.

The incorporation of five new cities has provided an alternative form of water and waste-water service provision which must be evaluated. The recent property tax reductions enacted by the state have left many districts in severe financial difficulties.

While LAFCO has decided to review the current system of delivering water and waste-water services to county residents, LAFCO cannot, and should not, make these decisions alone.

First and foremost, the customers within these districts must express their concerns regarding the way in which they are provided services and at what cost.

Second, the districts must actively participate in the review process.

Finally, the city council members and county supervisors who represent the areas in which these districts operate must be prepared to initiate appropriate actions which will best serve their constituents.

Many aspects of this process have already begun: residents have voiced their concerns regarding the existing structure of local governments; some districts, like the Capistrano Beach Sanitary District, have been pursuing consolidation for over two years; and the city of Dana Point has directed its staff to evaluate alternatives for consolidating districts within the city’s boundaries.

Working together, the existing structure of local governments in Orange County can be improved to ensure that current service levels are maintained or improved, while costs are reduced and accountability is increased.