County Officials Unprepared for Economic Downturn

One of the amazing things about elected officials is their superb knack for blotting out unpleasant memories of past financial hard times. And that’s certainly true with the L.A. County Board of Supervisors. A scant five years ago, the state was mired deep in recession, the Democratic-controlled state Legislature and Republican Gov. Pete Wilson were locked in intense political combat that drove state government to near paralysis, and cities and counties were scratching and clawing to get funds from Washington and Sacramento to keep their schools, hospitals, public agencies, police and fire services in business. In the midst of this economic and political chaos, L.A. County found itself in deep hock. Things had gotten so bad at one point that the Board of Supervisors seriously floated a proposal to padlock county hospitals and declare bankruptcy. It took a $1 billion federal bailout to keep the wolves away. But just barely. Now, with the national economy booming, the state awash in cash, and legislators dangling the tantalizing prospect of extra billions in the budget, it seems like sheer lunacy to worry that L.A. County will be plunged back into financial disaster. If boom goes bust Yet there are warning signs that it could happen again. And there are equally disturbing signs that county supervisors are not heeding those signs. In a recent study on local services in L.A. County, Marc Baldassare, a researcher at the Public Policy Institute, argues that when, not if, the current economic boom goes bust, the county would again be cash-strapped to fund public services. There are several culprits fingered for creating the predicament. – The state Legislature. In the early 1990s, Sacramento hogged the lion’s share of hundreds of millions of dollars of property tax money to balance the state budget. Nearly a decade later, state legislators have shown no willingness to share the wealth with cities and counties. – Proposition 13. The measure passed by voters in 1978 severely limits the amount of dollars that cities and counties can raise from property owners. This has pitted counties against the state and against each other in a mad scramble to divvy up the narrow pool of property tax dollars to fund their projects and services. – An exploding population. If current population projections are right, in the next decade L.A. County will add 3 million new residents. That’s the equivalent of another Chicago. A large percentage of the new arrivals will be unskilled, foreign workers fleeing dire poverty and political turmoil in Latin America and Asia. They will put an even bigger strain on the county’s already overtaxed schools, hospitals, and public services. – A grossly under-funded health care system. The number of persons in L.A. County without health insurance will soar in the next decade. And since federal law mandates that the county provide basic medical services to all of its residents, the current estimated cost of $2.4 billion for those services will almost certainly skyrocket, too. County officials did not create these problems. In a sense, they are victims of state and federal policies over which they have no control. Yet county officials are well aware of the looming financial crunch and have failed miserably to provide ways to deal with it. Looking for regional solutions There are several possibilities they should consider. They can create partnerships with cities and private health providers in which they would shoulder more of the costs of health care and services, reduce their expenditures on public services such as lighting and fire services in unincorporated areas of L.A. County, and use surplus revenues to establish an emergency bailout fund. They can also aggressively lobby the state Legislature and Gov. Gray Davis to provide a greater share of state revenues for local public services. Most importantly, the supervisors can create mechanisms to implement regional solutions to planning and budget problems. This is a step that they have stoutly resisted in the past. Like most politicians, they reflexively think first and last of ways to get more programs and services for the constituents in their own districts. This narrow political pandering makes it nearly impossible to develop regional solutions to problems. The hands-off approach by county officials to meaningful regional planning ensures that the 88 cities and special agencies in L.A. County, such as the Metropolitan Transportation Authority, are pretty much left on their own to decide their spending priorities. The inertia and indifference of county officials to general budget and planning matters has had an adverse affect on many county residents. A survey of the attitudes of county residents toward government is contained in the Public Policy Institute’s report. It confirms that L.A. County residents have far less confidence in the ability of county officials to manage problems than residents of other counties. As long as L.A. County officials continue to forget their cliffhanger escape from past financial doom and refuse to come up with solutions to make sure it doesn’t happen again, they won’t change those negative attitudes. Earl Ofari Hutchinson is a radio commentator and the author of “The Crisis in Black and White.”