Davis Cuts Would Jolt the County

Times Staff Writers

The state budget proposed by Gov. Gray Davis would deal a blow to Los Angeles County -- home to nearly a third of California's residents -- by withholding more than $650 million used to fund public safety, parks, libraries and other programs.

At the same time, the governor's plan would shift responsibility for many state programs to the already-strapped county government, raising concerns that long-term costs could further drain its coffers.

Davis' prescriptions for closing California's gaping budget gap would deplete services across the board, said county Chief Administrative Officer David Janssen. In the worst-case scenario, Janssen estimated, as many as 18,000 jobs -- a fifth of the county work force -- could be slashed.

Counties and cities across the state would face similarly deep cuts, though on a smaller scale. The governor's proposal for closing this year's budget deficit and next year's projected shortfall prompted such an outcry from local officials this week that Democratic leaders of the Legislature stepped in with a plan to raise vehicle registration fees to spare cities and counties a combined loss of $4.2 billion.

Los Angeles County officials say they face difficulties no matter what -- and especially if the vehicle license fee is not reinstated.

Here, positions for sheriff's deputies on street patrol could be eliminated, Janssen said. The district attorney's office would be forced to cut the number of cases it prosecutes. Parole officers would be hit with heavier caseloads and youth camps for juvenile offenders might be shut. In the coroner's office, cutbacks could mean fewer investigators on hand to respond to crime scenes.

Social workers probably would wind up with more cases. The county might have to close some of its parks, recreation centers or after-school programs. Library hours probably would be reduced, and so would the budget for buying new books.

"It's extraordinarily serious," Janssen said. "It would be impossible for the county to replace such a major loss of state funds."

With nearly 10 million residents stretching across 4,100 square miles, Los Angeles County has more people than most states. Virtually everyone living here brushes up against the county's massive government in some fashion, whether by paying property taxes, voting or swimming at a county beach.

Its most vulnerable residents -- foster children, poor families, the sick and elderly -- rely on the county for life-or-death services such as food, shelter or medical care.

Even without the governor's proposed cuts, the county suffers from chronic budget problems, particularly in its health system. Officials managed to avert the collapse of the emergency and trauma care network last fall by persuading voters to approve property tax increases, but the county still faces a health shortfall of at least $210 million within three years.

Los Angeles County's $16.85-billion budget is funded with a blend of federal, state and local dollars. The federal government contributes 25% and the state 21% of county revenue, most of which is mandated for specific human services such as welfare grants and health services.

The rest of the county's cash comes from property taxes, vehicle license fees, sales and use taxes, fines and service charges, and special funds and districts.

Like other counties and cities, Los Angeles County has come to rely on money from the car tax, so-called discretionary funds that pay for services not mandated by the state or federal government.

But the vehicle license fee has become a political football in budget skirmishes. During boom times, state lawmakers cut it by two-thirds and agreed to reimburse cities and counties for the lost revenue. But the tax was supposed to increase if times got tough.

So far that hasn't happened, and the governor now wants to stop compensating local governments for the difference. For Los Angeles County, that would mean a staggering loss of $663 million over the next 17 months.

For more than a million residents living in unincorporated areas, the county government functions like a City Hall, providing all municipal services. These areas, from the barrios of East Los Angeles to the Santa Monica Mountains to the high-desert plains of the Antelope Valley, would be especially hurt because many of their services are funded with discretionary cash.

The hardest hit would be the Sheriff's Department, which stands to lose $158 million if the vehicle license fees are not restored. The department could be forced to cut hundreds of patrol deputies, detectives and jailers, as well as dismantle special units that investigate child abuse and domestic violence.

"We don't want to hit the panic button yet, but it could boil down to our department reducing the most basic investigative and patrol services," said Paul Tanaka, chief of the department's Administrative Services Division.

The governor's budget plan also would dramatically realign the relationship between the state and its 58 counties.

It would hand over responsibility for more than 30 mental health, alcohol and drug, general health, child care and court security programs to the counties. To pay for them, Davis proposed $8.2 billion in new taxes.

The largest programs to be transferred would include Medi-Cal long-term care, In-Home Supportive Services and child care. Counties also would assume 15% of the cost of Medi-Cal benefits.

But these programs, many of them expanding quickly as the baby boomer generation ages, are likely to cost more than the amount earmarked to pay for them, according to a report Janssen presented to the Board of Supervisors.

The caseload for In-Home Supportive Services, which assists the elderly and disabled, increased by 38% from 1995 to 2001, according to a report by the California State Assn. of Counties. Counties now pay 35% of the program's costs, but the governor's proposal would shift the entire bill to them.

Some of the new taxes meant to pay for the transfer, moreover, would be subject to the same economic variables that brought the current budget calamity. Davis proposed boosting the sales tax and the income tax for high earners, but sales and income could sink in a recession.

"The programs they are talking about transferring are growing exponentially, while the revenue sources we'd get to deal with them are very anemic, at best. I don't think we're gong to be able to handle it," predicted Supervisor Zen Yaroslavsky. "You can't put three gallons of water in a two-gallon flask."

Marge Kelly, interim director of the county Department of Children and Family Services, said it's hard to forecast whether realignment would help or hurt because so many details are unknown.

"We're not presuming realignment would be a bad thing, because we think we're in a good position to lower the foster care caseload in the future," Kelly said, noting that the county's foster care population has dropped from 52,777 to 30,514 since 1998.

With fewer cases, her department is better equipped to take on new responsibilities. It's possible that the governor's plan could help reduce DCFS caseloads even further, she added, depending on how the realigned services were structured.

But other elements of Davis' proposal are likely to further burden the county's struggling health system, which has closed 16 clinics. About half a million adults statewide -- an estimated 200,000 in L.A. County -- would be forced off Medi-Cal, which funds health care for the poor.

"It's going to mean that more people are uninsured," said John Wallace, a spokesman for the county Department of Health Services. "It's very likely that people won't be seeking regular preventive care.... So, more people will end up in emergency rooms. It's a big concern."

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