L.A. County says proposed budget marks emergence from austerity

Los Angeles County officials overseeing the nation’s largest local government unveiled a budget proposal Monday that they said marks the beginning of an emergence from years of austerity.

The $24.7-billion spending plan calls for no major cuts and does not include a deficit for the first time since 2008.

County officials said they expect to see the fiscal situation continue to improve as the housing and labor markets recover, boosting tax revenue and reducing demand for social services.

However, county Chief Executive William T Fujioka said it will still be some time before county departments — which on average took a 15% cut over the last five years — see their funding restored to pre-recession levels.

Healthcare reform and state prison realignment are wild cards in budget projections. In particular, county officials said, the cost of implementing the federal Affordable Care Act by January 2014 remains unclear.

In the last five years, the county did not have the layoffs, furloughs or major program cuts endured by the city of Los Angeles and many other municipalities. The county even saw its Standard & Poor’s credit rating raised last fall. But the county’s 37 agencies — including the nation’s largest jail system and a vast network of medical and social service providers — had to dip into reserves, while most of their roughly 101,000 employees have not had a raise since 2009 and more than 2,000 vacant positions were eliminated.

The county is negotiating with unions representing public safety employees and will be entering talks with its other employee groups in the coming months. The unions have signaled that they will be pushing for raises.

Local 721 of the Service Employees International Union, which represents about 55,000 county workers, planned a mass “rally for raises” to coincide with Tuesday’s meeting of the Board of Supervisors, where Fujioka will formally present the budget.

Alina Mendizabal, a Department of Health Services marketing representative and an SEIU steward, said employees have struggled with heavier workloads and increased costs in gas, utilities and housing over the last five years, and many have left for the private sector.

“I’m just hoping they’re going to do the right thing,” she said of the supervisors. “What private company is going five years without giving their employees raises?”

Fujioka would not say if the proposed budget included possible salary increases, citing ongoing negotiations. But he said, “Our board has already stated publicly that when it’s possible, we will be talking to our labor groups about a cost-of-living increase.”

Board Chairman Mark Ridley-Thomas said in a statement that the county should proceed with “caution but also optimism” in the negotiations.

“Workers are indeed entitled to a wage increase, but any increase needs a sustainable source of funding and must be fiscally prudent,” he said.

Sheriff Leroy Baca has publicly wrangled with the supervisors over cuts to his department, which requested about $3.5 billion for the coming year. Fujioka’s budget recommended $2.8 billion, about the same as last year.

Sheriff’s spokesman Steve Whitmore said Baca understands the county’s fiscal situation but plans to continue asking for more.

“We’ve experienced such drastic cuts over several years, which have resulted in a complete elimination of overtime,” he said.

The proposed spending plan includes funding to address ongoing concerns about prisoner abuses in the county jails, including an initial $1 million for the Citizens Commission on Jail Violence and $5 million in provisional money to create an office of inspector general to monitor the Sheriff’s Department, pending a cost analysis.

It also includes $2.3 million for juvenile day reporting centers so youths can be diverted from probation camps as dictated by the U.S. Department of Justice, which is overseeing reforms there.

Fujioka praised the supervisors’ fiscal restraint, which allowed agencies to get through the recession relatively unscathed when other governments were implementing layoffs and service cuts.

“If you look at other entities, they did not demand the strict compliance with fiscal policies and fiscal discipline,” he said.

Public hearings on the proposed budget will begin next month, with a final budget to be adopted in June.

abby.sewell@latimes.com