Clock Is Ticking on Budget Debate

Gov. Gray Davis’ administration said Thursday that it could not legally make millions of dollars in payments to counties for welfare and other social programs until a state budget is passed.

The announcement was seen by some as a preemptive strike to pressure lawmakers into passing a budget by Monday, the start of the fiscal year. But some lawmakers said it is Davis who needs to act, by jump-starting budget negotiations and caring for the poor.

Senate Republican Floor Leader Jim Brulte of Rancho Cucamonga described the announcement as a “political tactic.”

“If the Davis administration really believes that that is the current state of the law, I think it makes it even more incumbent on the governor to sit down and begin negotiations so we can reach a bipartisan agreement on the budget,” Brulte said.

Senate leader John Burton (D-San Francisco) said of the administration’s contention that it can’t forward money to the counties: “Unless they’re legally, by judges, prohibited from doing it, as far as I’m concerned I’m not going to discuss their issues until they take care of the poor people.”

The announcement Thursday came from the California Department of Social Services, which said no state or federal funds will be advanced to counties for programs not mandated by federal law unless a new budget is in place. Money the counties are supposed to receive for July already is being affected.

A $245-million payment was supposed to be sent out today to counties for CalWORKs, a welfare-to-work program, and two other programs.

Another payment at stake for counties is $96 million for Child Welfare Services and Adult Protective Services and other programs, which is due by July 5.

Sharon Harper, chief deputy of Los Angeles County’s chief administrative office, said the county is examining how long it can continue to provide services given the state’s decision.

“We have funds available, but not for an extended period of time,” Harper said.

The executive director of the County Welfare Directors Assn. of California, Frank Mecca, said smaller counties could be in trouble quickly. “As the money they’re counting on does not materialize and the total increases, you increase the risks counties will curtail services and potentially not pay recipients their benefits.”

The County Counsels’ Assn. of California sent a letter to the social services department objecting to the decision.

The association also warned that if the department persisted in its position that counties must continue to make public assistance payments, many of them would have no choice but to only pay the county’s share.

That action, the letter warned, probably would result in litigation against the counties, which the state could get dragged into.

By Thursday afternoon, there appeared to be confusion in the Davis administration over the issue.

Rita Saenz, director of the social services department, said that the change in policy is the result of a review her department conducted after an appeals court ruled last month that if the budget isn’t approved by June 30, the state cannot distribute money to schools or pay full salaries to more than 200,000 state workers. That court decision isn’t final, and a petition for a rehearing is pending.

“We’re not in an adversarial relationship with the counties,” Saenz said. “If we could pay them, we would.”

Saenz said her department even submitted a request to Controller Kathleen Connell’s office to cut checks to the counties.

A statement released later by the social services department said that, after consulting with the controller’s office, it believed it had no authority to make the advance payments to the counties.

But Rick Chivaro, the controller’s chief counsel, said his office was never consulted.

“This is the most bizarre situation I have ever seen,” Chivaro said.

Bruce Cain, a political science professor at UC Berkeley’s Institute of Governmental Studies, said the Davis administration’s actions appear to be an attempt to pressure Republican legislators by demonstrating that failing to pass a state budget on time will affect people.

“The tactic here is to call their bluff and say, ‘Their obstructionism is apparent, and these are real state services that are going to be affected,’ ” Cain said. “How do you illustrate that? You do it by turning off the water.”

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Times staff writer Miguel Bustillo contributed to this report.