SPECIAL REPORT * Tricky political currents, budgetary quicksand and a vast bureaucracy are just a few of the challenges for the man with the job of . . . : Keeping the Nation’s Largest Local Government Running

With Los Angeles County Chief Administrative Officer David Janssen, the urge to be blunt often overcomes the desire to be politic.

“We’re failing all of the time,” he says of the nation’s largest local government. “With children’s services, and jails and early releases, and services to which we’re constantly restricting access. . . . That’s not to say that we’re not responsible for these services and not accountable. But in the overall picture we’re failing and we do the best we can year to year.”

A little-known man in a little-understood job, Janssen is the master technocrat for a county government that remains a mystery even to many residents.

Decentralized and largely hidden--operating in the publicity shadow of its smaller but politically snazzier namesake city--the county has struggled to stay afloat in recent years as its relationship with funding sources has been transformed from that of an entity that could tax at will to one that has to beg for bucks.

One way to think about Janssen’s role is to picture county government as a huge switching station that redirects dollars, mostly from other levels of government, to things such as the social safety net and the criminal justice system. Janssen operates as the switching station within the switching station.

To say that his job is politically tricky is an understatement. He is the official go-between for the county’s 37 operating departments, including those run by an elected sheriff and district attorney, and the five elected members of the Board of Supervisors--veritable kings and queens who function as both the county’s legislative and executive branch. Janssen can hire and fire no one.

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All of his power comes from the board. But he can make a lot of lives miserable. His most important function is to synthesize wishes, requirements and resources into an annual budget that decrees how $14 billion is to be spent.

Because he is in such a pivotal position at the levers of government, it is reasonable to wonder whether he might be using his power to pursue some sort of private political agenda. But there is no evidence of this. “I guess the best answer I could give you,” said Supervisor Don Knabe, “is it’s hard to say.”

A registered Democrat who has been a bureaucrat in state and county governments for more than a quarter-century, Janssen said that he discovered a few years ago that immersion in carrying out the agendas of others had pretty well blanched him of his own.

He had become a consultant to a foundation set up by Sol Price, the politically liberal founder of the Price Club stores, when, to his amazement, he said: “I realized I was having problems forming opinions.”

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In the two years he has been at his current job, he has developed a reputation as a generally effective, honest broker of information who tries to put people at ease, seeks consensus and has an air of being relatively anxiety-free--all handy talents for dealing with entrenched bureaucrats and egotistical politicians who sometimes don’t even want to talk to one another.

“I think he’s made all the right moves,” said Jim Hankla, who held the job in the mid-1980s before becoming city manager in Long Beach. “He’s established what I perceive to be a good working relationship with the Board of Supervisors. He has brought a real analysis to the budget process . . . he is attempting to communicate with other jurisdictions in positive ways.”

David Abel, chairman of the county’s Economy and Efficiency Commission, which he jokes is an oxymoron, said he finds Janssen to be “a highly intelligent man who by temperament is mild, gentle, not confrontational . . . who gives you a straight answer to a hard question in a way that doesn’t corner you.”

Even Bud Treece, whose Assn. of Los Angeles Deputy Sheriffs portrayed Janssen as a dunce during contract talks, had something nice to say. He said he respects Janssen for being forthright. “I think David is what you see,” he said.

Inevitable Fiscal Woes

Janssen’s credibility as a political forecaster got a boost this year when the state Legislature validated all of the assumptions he made to balance the budget.

His biggest failure has been his inability to head off a clash between supervisors and a group of Latino legislators from Los Angeles who threatened to punish the county financially by withholding state funds unless the supervisors agreed to build a larger replacement for County-USC Medical Center than they plan to.

Part of the era of good feelings toward Janssen may reflect a sense of relief brought on by improving economic times.

During the reign of his most recent predecessor, Sally Reed, one supervisor talked publicly about bankruptcy. Wall Street firms that loaned the county money insisted on an expensive insurance policy to guarantee that they would be paid back.

But, aided by the resurgent economy that has refilled coffers at all levels of government, the county has rebounded somewhat. Wall Street has allowed it to cancel its insurance policy. For the first time in years, workers are getting modest raises rather than pink slips.

Janssen is far from sanguine about the county’s long-term fiscal condition. He knows that county government’s biggest underlying problem--a loss of financial home rule--has not been fixed and is not likely to be any time soon.

Like all counties in California, Los Angeles is no longer in charge of its own financial fate. The initiatives that have made levying most additional local taxes impractical--Proposition 13 and its progeny--effectively transferred the power to apportion property tax revenues to the state. During times of economic hardship, the state has claimed more money for itself, leaving what some academic observers have calculated is a $1-billion permanent hole in the Los Angeles County budget.

The state is also in the driver’s seat about what the county spends. It requires the county to provide a huge range of services--such as criminal defense and medical care for the poor.

Because demand for these services in Los Angeles exceeds the state and federal dollars allocated for them, the county routinely dips into its own discretionary funds to make up the difference. The result is a marked loss of flexibility to meet other needs. Only 1% of the county budget remains available for its discretionary use, a study by the Economy and Efficiency Commission found, down from 20% in the early 1980s.

“We don’t control our own destiny,” Janssen said. “[We] can’t increase revenues and can’t control expenditures. . . . How long can an institution survive when it has no control over revenues and expenditures?”

The question is rhetorical. Janssen knows that initiatives like Proposition 13 are statues in the California political landscape and unlikely to be moved. So an essential part of his job is to work around them, going hat in hand to politicians in Sacramento and Washington for aid.

Predecessors’ Problems

His strategy as a beggar is much like his strategy as a manager: Be open, kid around, get people to like him. “If people don’t like you for whatever reason, they won’t go out of their way to help you,” he said.

A deceptively slight person--whose grip gives away that he works out--Janssen, 53, did not set out to be a bureaucrat. After a thesis on the Soviet economic and political system earned him a PhD in political science from UC Davis in 1972, he tried to become a college teacher. But he ran into a PhD glut--and then into some recruiters from the state Department of Finance.

As a policy analyst for the Finance Department, his performance caught the attention of Rose Elizabeth Bird, then director of the Agriculture and Services Agency for then-Gov. Edmund G. “Jerry” Brown Jr. She installed him as director of the state Department of General Services, in charge of state buildings and equipment purchases.

To this day, he regards Bird, who served one term as a highly controversial chief justice of California, as the most honorable person he has ever met.

After the Brown administration, he switched from state to county government, becoming assistant CAO and later CAO in San Diego County.

After four years in the latter post, he briefly became a consultant to the Price family foundation, then decided to compete for the Los Angeles job, which had become something of a revolving door.

Three others had held the post during a tumultuous four years in which the state, reeling from a recession, had stripped the county of significant funds in order to balance its own budget.

CAO Richard Dixon had been initially viewed as a wizard for coping with the loss of state funds by arranging long-term debts such as the mortgaging of Marina del Rey. But he fell victim to hubris. He boosted pensions for himself and other top officials and failed to disclose the true costs of a multimillion-dollar remodeling of the CAO’s offices.

Harry Hufford, who had served in the post from 1974 to 1985, was brought in as a caretaker briefly.

Then came Sally Reed, a model of probity who had served as CAO in Santa Clara County, where the job carries far more executive authority. Reed alienated some key bureaucrats and interest groups almost from the start. There was a substantial list of people with whom she was not even on speaking terms, officials said, including the county counsel.

But she was a darling of the press for straight talk--and clear solutions--that demystified the massive county budget mess. She said the county needed to dramatically downsize to avoid fiscal collapse.

When Reed proposed closing County-USC Medical Center, the only indigent care hospital on the county’s sprawling Eastside, the list of people who would not talk to her expanded to include Supervisor Gloria Molina, who represents the communities around the hospital.

One indication of the instability of those years is that it is now viewed as remarkable that Janssen is on speaking terms with all members of the board.

While Janssen retains the supervisors’ trust--”It won’t last forever,” he notes--he hopes to use his clout to encourage more cooperation between departments and the county’s 80,000 employees. Many of them, aides say, now function with a risk-averse bunker mentality. There is no county-wide strategic plan, no operations manual, no standardized approach to functions such as purchasing.

Front Lines of Change

Aside from administrative headaches, the county faces huge social challenges, including welfare reform, and its children’s services are overwhelmed and under attack.

It is also struggling to transform itself in the eyes of the politicians in Sacramento and Washington who increasingly control its fate.

Many state officials have traditionally seen Los Angeles County as more bully than supplicant--demanding to be served the biggest portion of pie, rather than sitting down politely with the rest of the family and helping figure out how to fairly cut it up.

There is also resentment directed at the Los Angeles County board because--in the person of former Supervisor Pete Schabarum--it promoted the term limits movement that cut short many a political career in the state capital, while leaving supervisors free to serve unlimited terms.

Early returns from the Janssen era indicate that state-county relations are improving. It was a big victory when the state this year required the county to put up less money to fund courts and agreed to absorb more of the administrative costs of doling out federal funds, saving the county $100 million a year.

In Washington, where the increasingly dependent county recently hired its first full-time lobbyist in a decade, there has also been some progress. This year, Congress agreed to lift a cap on certain hospital reimbursement funds worth $135 million per year to Los Angeles.

However, Congress only lifted the cap for two years, creating a “time bomb” in the county budget.

A separate federal bailout of the health care system offered by President Clinton during the county’s darkest days also expires in two years.

What then?

“Then we’ll try again,” Janssen said.

Or someone will.

“In two years,” he quipped, referring to himself and county health Director Mark Finucane, “Mark and I are going to leave and say, ‘Thank you very much. It was fun while it lasted.’ ”