County to Look for Revenues to Close Gap of $900 Million

Signaling a reluctance to make broad-based deep cuts in county services, the Los Angeles County Board of Supervisors on Tuesday approved a plan to explore ways of generating new revenues to close a $900-million budget gap.

Chief Administrative Officer Sally Reed, hired last year in part on her ability to push through deep spending cuts, has prescribed a budget that would reduce departmental expenditures by an average of 36%. Senior managers, in response, say the cuts would devastate county government, force thousands of layoffs and subject the county to possible lawsuits and threats of violence.

In fact, Joseph Van Der Meulen, vice president for health affairs at USC, told the board that if the county were to close County-USC Medical Center to cut costs--as has been hinted--the university could be forced to close its medical school.

But supervisors said there might be another way, by building a broad coalition with labor and advocacy groups and other community representatives to reduce the impact of budget cuts.

The board’s new strategy includes asking county department heads to come up with new revenue-generating ideas--such as utilizing untapped federal funds, establishing a county-community task force to lobby support from Sacramento, and putting off some liabilities--such as deferred overtime and worker’s compensation--now included in this year’s budget shortfall.

The board’s initiative was brought by Supervisors Ed Edelman and Gloria Molina and supported by Supervisors Yvonne Brathwaite Burke and Deane Dana. Supervisor Mike Antonovich opposed the motion.

“If the cuts that are now being proposed were to take place it would leave the county in a devastated position,” Edelman said. “I was concerned that we give some direction right away to the CAO on how we intend to proceed with this budget.”

Edelman suggested that the board may consider raising some of the taxes it has under its authority in unincorporated territory, such as business licenses and sales taxes.

The board directed Reed to return in three weeks with new budget options.