Tuesday, January 04, 2011

California Gov. Jerry Brown's new budget: the pain for L.A. city and county

Not thirty minutes after my prior post and the Los Angeles Times posts this new column:

Take, for example, just three of the proposals local officials confirm they expect to see in Brown's first budget: drastic cuts to Medi-Cal and the CalWORKS welfare-to-work program, and the diversion of so-called low-level offenders from the state prison system to local jails.

[Los Angeles] County Chief Executive William T. Fujioka told me this week that his office has been in talks with Sacramento for a couple of weeks on how to handle the staggering additional costs Los Angeles will be forced to assume. "They're just pushing these problems down to the local level with no real thought about the consequences, and I find that amazing," said Fujioka, who, at 60 and a veteran of both city and county politics, is no stranger to bitter budget warfare.

Fujioka expects Sacramento to pay 40 cents out of every dollar of additional costs the County will incur with regard to additional prisoners in County jails.

Local officials are also expecting Brown to eliminate Community Redevelopment Zones and Enterprise Zones.  These are special tax districts that allow revenue generated to stay in the Zone rather than flowing to Sacramento.  By eliminating them, Brown will have more money to spend while leaving less money for the cities that established those Zones.

[Los Angeles’] 32 districts pumped $178 million in direct investment into the city's economy. Although $100 million of that went to encouraging job-creating businesses, $50 million paid for more affordable housing across the city. Moreover, according to Essel, because every dollar spent by the CRA generates an additional $5 to $6 in private investment and payrolls, abolition of the CRA would take at least $890 million out of the city's economy in the new state budget's first year.

And so it starts.  Sacramento will tell cities and counties to take on these services, but keep the money that local taxpayers assume will be used to pay for those services.  The best part is how the column ends:

Both Essel and Fujioka, like other local officials with whom I spoke this week, believe that the brutal cuts Brown is proposing are meant to set up the anticipated spring election in which the governor will go to the people and ask them to approve the extension of existing tax surcharges. Playing chicken with voters whose own finances are, in many cases, stretched to the breaking point could be a dangerous proposition.

But that's what Governor Moonbeam is planning.  Does he have a back-up plan?  Heck, why should he?  I doubt any of Jerry’s wealth is tied up in California investments!

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