County Adopts Budget Without New Jail Funds

Postponing the toughest decisions until midsummer, the Los Angeles County Board of Supervisors adopted a fragile $12.2-billion budget for the new fiscal year Thursday without coming up with the money to open the high-security Twin Towers jail that stands as a monument to the county’s fiscal crisis.

Despite much discussion about the importance of public safety and the need to open at least one of the Twin Towers, the supervisors ultimately refused to cut spending elsewhere to break free the $18 million needed to open the jail.

The board’s failure to find the operating funds left festering the political and law enforcement nightmare of having a state-of-the-art, $373-million jail standing empty near downtown Los Angeles while prisoners are released early from a troubled jail system after serving only a fraction of their sentences.

Instead, the supervisors merely directed Sheriff Sherman Block to spend $500,000 to begin planning for opening the first phase of the high-rise jail complex. “I am convinced that they are going to come up with a way to finance one tower,” Block said.

After three days of deliberations punctuated by personal barbs, the supervisors agreed to keep the county’s probation camps for youthful offenders and welfare offices open without knowing how they will pay to keep them in operation for the entire year.

They delayed key decisions on restructuring the county’s vast health system until later this summer. However, the board has signaled its intent to turn over 22 community health clinics to private operators and move to privatize Rancho Los Amigos Medical Center, one of six county hospitals.

The board also refused to cut youth gang services and work furlough programs for probationers, and to turn over at least two county regional parks to cities where they are located.

The board’s reluctance to make tough choices leaves the spending plan out of balance, and further cuts or increases in revenue must take place to avoid deficit spending, which is prohibited by state law.

In sharp contrast to last summer’s budget chaos, when thousands of county employees demonstrated loud and long outside the Hall of Administration, the supervisor’s chambers were all but empty when the spending plan was adopted on a 4-1 vote.

Supervisor Zev Yaroslavsky was the lone “no” vote after his controversial proposal to reduce spending by nearly $50 million failed to gain a second. “This budget does not open Twin Towers,” he said. “This keeps us on a spending curve that is unsustainable.”

Yaroslavsky said the county continues to rely on one-time, excess earnings from its pension fund and carry-over balances from the previous budget to pay the cost of ongoing programs, a practice criticized by Wall Street bond rating agencies.

But Supervisor Gloria Molina charged that Yaroslavsky was being “inconsistent” by voting to increase spending in some cases while demanding cuts elsewhere in the budget and then voting against it. She accused Yaroslavsky of “double talk” and pointedly told him, “You do it well.”

Molina said the board is “on a deficit spree, not a spending spree” by maintaining programs that it knows the county cannot afford. Efforts by Molina to get her colleagues to slash the $1 million set aside for projects in their districts went nowhere.

The supervisors also turned back Yaroslavsky’s demands to break up the sheriff’s $1.1-billion budget into five distinct units next year in an effort to tighten the board’s oversight of the county’s biggest law enforcement agency. Reopening a feud with Block, Yaroslavsky told his colleagues there seems to be “a genuine fear about talking about the Sheriff’s Department’s budget.”

Both Molina and Supervisor Yvonne Brathwaite Burke, whose districts include unincorporated areas patrolled by sheriff’s deputies, resisted the idea, but said they would welcome more information on the department’s spending.

Board Chairman Mike Antonovich acknowledged that “this is not a hard and fast budget,” but called it the first step in adopting a final spending package when the board takes up the budget issues again on Aug. 20.

As budget deliberations wore on during the week, Antonovich, clearly miffed at long-winded discourses by Molina and Yaroslavsky, imposed a three-minute time limit on the supervisors, to the dismay of those targeted.

On Tuesday, Antonovich said the process of putting the budget together was “like giving the birth to a porcupine” and grumbled that “we have never talked so much and accomplished so little.”

He said the board cannot make final decisions on Twin Towers, probation camps and other programs until the Legislature passes the state budget, the books are closed on the current fiscal year, and the supervisors know exactly how much the county’s huge pension fund has generated in excess earnings from the surge in the stock market.

All week, there were signs that most, but not all, of the supervisors want to find a way to divert some of the profits from the $20.7-billion retirement system to help close the holes in their budget.

The board did approve the use of $270 million in excess earnings from the pension fund to cover the county’s entire contribution to the retirement system in the 1996-97 fiscal year that begins Monday.

And, in a commitment intended to ease future budget problems, the board voted to negotiate with the retirement system to use an additional $250 million in excess earnings as a down payment on the following year’s retirement costs.

Block said he believes “there is a lot of surplus money” in the retirement system that will ultimately provide the funds needed to open Twin Towers. Opening Twin Towers would somewhat alleviate the overcrowding in the County Jail system by providing the opportunity to move “a couple thousand very serious offenders” to the new high-security facility, Block said.

For now, only a handful of the county’s 81,000 employees face layoffs in the new fiscal year, but that number could increase into the thousands if the supervisors cannot come up with the money to close the gaping $60-million hole in the probation and welfare budgets alone.

Overall, the budget adopted Thursday is just under $30 million larger than the current fiscal year. It has no new taxes, but does increase assessments charged to property owners served by the county’s flood control district.

Sandra Davis, the county’s interim chief administrative officer, said more work needs to be done on the spending plan. “It is not finished,” she said. Davis said she will identify at least $50 million in potential budget cuts in the next 45 to 60 days, which the board could impose late this summer, if necessary.

The county’s financial fortunes have rebounded from the worst fiscal crisis in its history largely because of the promised infusion of more than $536 million for its vast health system from the Clinton administration. The money has stabilized the nation’s second-largest health system, which was on the verge of collapse last summer.

But in return for the federal assistance, the county has promised to remake the hospital-heavy health system to one that emphasizes primary and preventive care at community clinics. To underscore the importance of moving forward with the restructuring, Top federal health officials took a helicopter tour of county hospitals this week and met privately with the supervisors.