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object(Timber\Post)#3742 (44) { ["ImageClass"]=> string(12) "Timber\Image" ["PostClass"]=> string(11) "Timber\Post" ["TermClass"]=> string(11) "Timber\Term" ["object_type"]=> string(4) "post" ["custom"]=> array(5) { ["_wp_attached_file"]=> string(12) "R_600MBR.pdf" ["wpmf_size"]=> string(6) "284570" ["wpmf_filetype"]=> string(3) "pdf" ["wpmf_order"]=> string(1) "0" ["searchwp_content"]=> string(259559) "Risky Business: Providing Local Public Services in Los Angeles County ••• Mark Baldassare Michael Shires Christopher Hoene Aaron Koffman 2000 PUBLIC POLICY INSTITUTE OF CALIFORNIA Foreword When Orange County went bankrupt in December 1994, it focused public attention as never before on the fiscal and political balancing act that is a way of life for California counties. This balancing act is induced by the complexity of funding arrangements with the state and widespread public confusion about what level of government is responsible for what services. Counties are agents of state government and, since Proposition 13, have depended primarily on state resources for financial support of their programs and services. At the same time, counties are expected to respond to changing demands that often require them to provide services without the resources to do so. To help the county meet such fiscal demands, Orange County’s treasurer made the very risky investments that pushed the county into bankruptcy. At almost the same time, similar pressures brought Los Angeles County to the verge of a fiscal meltdown. PPIC research on the Orange County bankruptcy and, more generally, on the state/local fiscal relationship was beginning to identify the forces contributing to the iii unique vulnerability of county government in California. In 1998, these circumstances led PPIC to approach Los Angeles County with the objective of taking a careful look at the operations of the largest county in the state of California. The result is Risky Business: Providing Local Public Services in Los Angeles County, by Mark Baldassare, Michael A. Shires, Christopher Hoene, and Aaron Koffman. The authors provide a thorough analysis of perceived fiscal strains facing the county and its administrators, and the organizational stresses associated with a complex system of finances that makes it difficult to associate service delivery with accountability. One of the most valuable contributions of the research is the systematic linking of budget detail to the actual provision of services. Detailed tables in the appendices show exactly how complex this unit of government has become. This complexity suggests not only why the county is difficult to govern, but why it is vulnerable to a level of abuse and confusion that makes fiscal crises almost certain to occur on a regular basis. With 37 departments, 84,000 employees, 88 cities, and over 200 special districts and regional agencies, a single county government serving ten million residents faces formidable challenges. The report is not only about numbers; it also seeks to answer questions about how the county might do business more effectively. How could the county gain more fiscal control? How could it become more responsive to residents? And how could it deal with the everchallenging demands of a more regional orientation? These are just three of the key questions that are explored in detail through county staff interviews. It is striking how practical some of the answers to these questions are. What is also striking is how politically difficult it iv apparently is to pursue the specific suggestions mentioned in the interviews. Our hope is that, as they attempt to move county government out of its balancing act and onto more stable ground, all participants in county government—taxpayers, government administrators, and elected officials—will use the information in this report as a starting point for tackling this formidable task. David W. Lyon President and CEO Public Policy Institute of California v Summary County governments in California are in the risky business of having to provide essential services to an uncertain number of residents with funding sources that are largely beyond their control. All county governments participate in a system of delivering local services through complex state and local financial relationships that evolved over decades. From time to time, this fiscal system has shown signs of serious strain. During the recession in the early 1990s, county governments throughout the state had serious fiscal problems. Los Angeles County came close to a fiscal meltdown, and a large bailout in health care funding was needed from the federal government; but other large urban counties also suffered financial problems. Several rural counties also ran into serious fiscal troubles. Some observers have blamed the current state and local fiscal arrangements for the problems that county governments have faced, most recently, exemplified by the legislative action in the early 1990s allowing the state to take back property tax revenues from counties. This vii study of Los Angeles County thus has relevance for county governments throughout California. Los Angeles County was chosen for study because it is the most challenging environment in the state for local governments to provide services to their residents. The county includes almost ten million residents—nearly 30 percent of the state’s population—and is expected to be home to another two million people in the next two decades. It has been a leading immigrant destination, resulting in its current status as a “majority-minority” county in racial and ethnic composition—i.e., no racial or ethnic group represents 50 percent or more of the county’s population—and the county will soon have a majority Latino population. The responsibility for providing local services is in the hands of a massive county government, 88 city governments, and over 200 special districts and regional agencies. In recent years, the booming economy has produced extremes of both wealth and poverty. As the main provider of public social services, Los Angeles County is faced with ever-increasing demands for these services as a result of the expanding population and growing poverty. One example is that a very large uninsured population turns to county government for its health care. Local government officials in the county, as well as throughout California, have complained that citizens’ initiatives and legislative actions have severely constrained their abilities to meet these increasing local demands for services. This study of local public services in Los Angeles County was conducted through funding by the Public Policy Institute of California and with the cooperation of the Chief Administrative Office of Los Angeles County. The study had four goals: viii 1. Identify the perceived fiscal strains and organizational stresses in the provision of local public services, according to those familiar with Los Angeles County. 2. Describe the system for financing county-provided services. 3. Describe the broader context of local service provision by noncounty jurisdictions, including cities, special districts, and regional agencies. 4. Identify alternative fiscal and organizational arrangements for providing local services. We developed a methodology to meet the goals of this project within a one-year time frame. In identifying the perceived fiscal and organizational stresses, we conducted 31 in-depth interviews with elected and appointed officials from county, state, city, special district, and regional governments and community leaders from nonprofit, business, labor, media, academic, and civic organizations. For describing the county-provided services, we used the 1997–1998 county budget reports, which were the most recent county fiscal data available at the time the study began. For noncounty services, we identified the revenues, expenditures, and services provided in a sample of 24 cities in Los Angeles County and the special districts that involve most of the expenses for services in Los Angeles County. To ensure comparability with county government statistics, we derived the data for noncounty services from the 1997–1998 budgets. We identified alternative fiscal and organizational arrangements through the interviews and through supporting information from county and noncounty budget analyses. Perceived Fiscal Strains and Organizational Stresses Strong themes about the fiscal strains and organizational stresses experienced in providing local services emerged across the in-depth ix interviews with state, county, and local elected and appointed officials and Los Angeles civic leaders. These reflections by knowledgeable sources were useful for generating hypotheses for the quantitative analyses of county government and other local jurisdictions and for exploring ideas about alternative fiscal and organizational arrangements for providing local services. Perceived Fiscal Strains 1. The county government has little control over the revenues it generates and the monies it spends on services for residents. As a result of Proposition 13 and related legislation, there is a widespread perception that county government has lost control of its major revenue source, which was the local property tax. In filling the service needs of residents, county government has become increasingly dependent on state and federal monies that usually arrive with strings attached. This leaves county officials with little room for maneuvering in the types and amounts of services they provide annually—and little flexibility during recessions. 2. State, federal, and county governments are partners in delivering local services, but uncertainties about state and federal funding and mandates create tensions. In particular, the state government needs the cooperation of the county government as the “agent of the state” in delivering certain essential services at the regional level, and the county government needs the financial wherewithal from Sacramento to provide other local and countywide services to its residents. There was a feeling that the tensions surrounding the current state and local fiscal relationships—partly but not only as a result of the state government taking funding from the county government during the x recession—had done some harm to this key partnership. Some felt that relationships had improved in recent years, although largely as a result of a less stressful budget environment in Sacramento. 3. Health care is a chronic and unsolved problem facing countyprovided services. Although the 1994–1995 health care crisis was averted, no one today believes that the problem has been resolved. There are a variety of opinions on the severity of the problem, but there is general consensus that providing health care to the large, uninsured population of Los Angeles County is the most worrisome issue for county government. Most realize that the county government is heavily dependent on a continued federal bailout, and everyone knows that this funding source will not continue indefinitely. Despite recognition that the federal bailout will not continue and that another crisis is likely with the next recession, there is also a consensus that county government does not know how to solve the problem. 4. The scarcity of local revenue sources may be leading to development decisions that favor commercial growth that generates local sales tax dollars over the region’s housing and economic needs. Many of the leaders we spoke to believed that local development decisions are leaning too much toward retail and commercial building rather than residential and industrial construction, because the former generates sales tax revenues for the locality whereas the latter does not. In an era when local governments have few options for raising revenues, many are concerned that the “fiscalization of land use” results in too many local growth decisions that are not in the best interest of the region as a whole. 5. Fiscal uncertainties make long-term planning difficult, even though the county government is in better shape today than it was in xi the mid-1990s. There was near consensus that these are good fiscal times in county government, particularly compared with the dark days of the near fiscal meltdown during the recession of the early 1990s. A better economy and a more effective management structure are credited with the turnaround. Yet, there is a widely held belief that the current good times are only temporary and that county government will find itself in deep trouble again when the economy inevitably enters the next downturn. The uncertain fiscal environment makes it difficult to plan for this eventuality. Perceived Organizational Stresses 1. The size of county government and the large number of local governments operating in the county lead to public confusion about local service delivery. Local government in Los Angeles County includes the county government (84,000 employees and 37 departments), 88 cities, and over 200 special districts. Some of those interviewed considered the county government big and unwieldy. Others believed that there are too many cities and special districts. The size and complexity of these governmental units was linked to perceptions of “fragmentation” in decisionmaking about local services and a bureaucracy that is too difficult for the public to understand and access. 2. The connections between state revenues and local expenditures are so complex that is difficult to know who should be held accountable for local services. Many local and state leaders are troubled by the appearance of a “disconnect” in state and local fiscal relationships resulting from local government dependence on state funds. The current system raises public doubts about what tax monies go to what services xii and confusion about which branch of government can really be held accountable for delivering these services. 3. Contract cities (i.e., those cities that provide public services through contracts with the county government) seem to offer an efficient means of providing local services, even though these longstanding county-city relationships are still controversial. The topic of contract cities has for many years generated controversy in Los Angeles County. Some think that the county should not be in the business of selling its local services to cities. Large cities have complained that contract cities are not “real cities.” Others worry that the county government is already stretched too thin to be providing local services to contract cities and that making city incorporation easier only increases the fragmentation of the region. On the other side, some have argued that the contract city arrangement has reduced administrative overhead and service redundancies in the region. They argue that contract cities are an efficient way to achieve local governance. Most of those interviewed within county government spoke only of the benefits of contract cities—such as additional revenues and incentives to increase efficiency—whereas those in cities and special districts, as wells as civic leaders, offered mostly positive evaluations but more mixed reviews of this special county-city relationship. 4. Unincorporated areas may be an unwanted burden on county government, but many roadblocks prevent their incorporation or annexation by cities. About one million people in Los Angeles County—or approximately one in 10 residents—live in unincorporated areas. They are dependent on the county government for their municipal-level services, because they have no city government. For the urban unincorporated areas, these are services that would otherwise be xiii provided by city government, if these areas were annexed or incorporated. Again, this kind of local service activity reduces the county government’s ability to focus on its role of providing regional-level services. Given the revenue-generating limitations faced by the county government, many have suggested that urban unincorporated areas should be annexed by adjacent cities or incorporated into new cities, thus removing this service burden from county government. Most of the respondents in our study agreed with this idea in principle, although many understood why this process was not moving ahead. For the most part, residents in unincorporated areas seem to be satisfied with the services they are receiving and the cost of local government, so they are not seeking to incorporate or be annexed, and cities are in no hurry to annex land that is not generating enough revenues to cover the costs of services. 5. County government should work more closely with cities and other local governments, the private sector, and nonprofits in providing local services. There is a widespread recognition that the county government needs to improve its ability to be a partner with other local governments in providing services. Although most felt that relations between the county government and other local governments have improved in recent years, many also perceived that collaborative efforts were still too rare. Others want the county government to more actively seek partnerships outside local government, specifically, contracting with the private sector and taking advantage of the accumulation of wealth and talent in the nonprofit organizations throughout the region. Some called for public-private partnerships to meet the health services needs of the uninsured population. Many believed that if local governments are to succeed in such a challenging environment, the county government xiv must create a sense of purpose for the region as a whole—an endeavor seldom undertaken. The County as a Regional Government Los Angeles County serves as the regional government for the territories within its boundaries. In its regional role, the county has two responsibilities: (1) As an independent county government, it must respond to the needs and preferences of a countywide electorate, and (2) as an administrative agent of the California and U.S. governments, it must implement state and federal initiatives. Both responsibilities are considered part of the county’s regional role, because the services provided are delivered to the entire region within the county. To examine the county’s regional roles, we conducted an extensive, programbased analysis of the county’s finances. Our analysis identified several areas where, in its role as a regional government, the county has experienced the kinds of fiscal strains and organizational stresses identified in the interviews. 1. The county government has little control over its revenues. Only a small share of the county’s revenues are discretionary, thus limiting the government’s ability to respond to local preferences and needs. Ten percent of the county’s revenues come from unrestricted property taxes, 11 percent from service charges and fees, and 8 percent from other taxes and revenues. Since many service charges and fee revenues result from providing services (e.g., water and sewers), the use of these revenues is restricted. As a result, 21 percent of the county’s revenues are generally available to fund the regional activities that account for some 25 percent of county expenditures. This produces xv significant budget pressure and makes the county more reliant on intergovernmental transfers to provide these services. 2. The county government has little control over its expenditures. The county role as an agent of the state and federal governments dominates its regional responsibilities. Expenditures associated with the county’s “agency” role account for 62 percent of its total expenditures. Expenditures associated with its role as a provider of countywide services—such as county jails, flood control, planning, and consumer affairs—account for 25 percent of its expenditures. The remaining 13 percent of expenditures are for municipal services—such as local police, fire, animal control, and water and sewer services—which the county provides for residents of both unincorporated and incorporated areas within its jurisdiction. 3. Uncertainties about state and federal funding and mandates, notably in the area of health care, create intergovernmental tensions over local service delivery. Services the county provides as an agent of the state and federal governments often cost more than the county receives. In many instances, the county spends more on state and federally mandated programs than it receives in intergovernmental revenues. For example, the expenditures for health services the county provides in its agency role exceeded the intergovernmental revenues it received for these purposes by some $211 million in 1997–1998. Shortfalls such as this are produced by a combination of matching fund requirements (i.e., mandates that the county complement, by a certain percentage, the funds it receives from the state or federal government), maintenance of effort requirements (i.e., mandates that the county maintain a minimum level of service provision), and local county preferences. xvi 4. Fiscal uncertainties make long-term financial planning difficult for county government. The absence of a portfolio of local, discretionary streams makes county finances more vulnerable to economic shocks than other local governments. The majority of the county’s locally discretionary funds come from the property tax. Sales, business, franchise, and utility taxes are a minor portion of the county’s revenue stream. As a result, the county budget is particularly susceptible to changes in property tax revenues, through either state fiscal policies or downturns in the real estate market. Over time, cities have developed a greater ability to limit this vulnerability by expanding their reliance on alternative revenue streams. 5. The county government’s role as an implementing agent of the state and federal governments creates significant organizational problems. Aside from the accountability issues implicit in a system where the implementing body faces a different group of constituents than the policymaking body, the county’s agency role serves to create significant conflicts of interest within its boundaries. Maintenance of effort and matching fund requirements are excellent examples of how the policy choices of the state and federal governments constrain the county’s ability to customize programs to better suit local needs. Additionally, these two paternal governments can sometimes disagree and issue conflicting edicts, as has been the case with the new Los Angeles CountyUniversity of Southern California Medical Center. 6. The size and scope of Los Angeles County as a single government leads to confusion about the delivery of local services. One issue that is abundantly clear from our analysis is that the size and scope of Los Angeles County contributes directly to confusion about its role and objectives. This confusion is further complicated when the county is xvii acting as an agent of the state or federal government and is implementing their policies. Even with the direct assistance of the senior management of Los Angeles County and a well-trained staff, it took us several months to begin to understand the complexities of Los Angeles County’s many departments and agencies. It is inconceivable, therefore, that the average citizen can fully understand many of the county’s complex policy decisions, which in turn, leads to confusion and misunderstandings about the county’s goals and objectives. The County as a Municipal Government Los Angeles County’s municipal services are provided through three institutional mechanisms. The first of these is direct provision, in which the county provides municipal services to unincorporated areas through county departments, and cities provide services to their residents through municipal departments. The second mechanism is through a multitude of special districts, including specifically drawn assessment districts, county-governed special districts, and special districts that operate independent of county control. The final mechanism for providing municipal services is through contract service provision, which involves contractual relationships between the county, cities, and the private sector. Our analysis of these three mechanisms reveals a nexus between the county government, cities, and special districts providing municipal services to the county’s residents. However, this nexus also creates complications, both in terms of institutional arrangements and in the confusion that inevitably accompanies a system in which multiple levels of government are providing similar services. Our budget analysis xviii revealed several examples of the fiscal strains and organizational stresses mentioned in the interviews. 1. The large number of local governments providing services makes it difficult to ascertain which level of government is ultimately responsible for providing which service. The county, 88 cities, and more than 200 special districts simultaneously provide municipal services through numerous institutional relationships, including county provision to unincorporated areas, special districts, and contracting. The current system may be efficient from a local government perspective, but it is highly complicated and understandably breeds confusion, frustration, and even irritability with government when one tries to identify who is responsible for providing a given service. 2. The institutional arrangements between the county, cities, and special districts make it difficult for the public to know whom to hold accountable. The complexity that results from multiple levels of local government providing municipal services makes it difficult for the public to know whom to hold accountable. The complexity is reinforced by the complicated flow of revenues and expenditures between local governments. Financing of municipal services in Los Angeles County is accomplished through revenue transfers between cities and the county, between the county and special districts, and between cities and special districts. From a constituent perspective, understanding which services are provided through property taxes and which through special assessments is difficult, and this creates uncertainty about how the taxpayers’ money is being spent and a sense of alienation and distrust because no identifiable accountability is affixed to the expenditures. 3. Eliminating the county’s role as a municipal service provider to unincorporated areas through annexation and incorporation is subject xix to many impediments. One proposal suggested in the interviews for reducing the complexity of municipal service provision is to eliminate the county’s role as a municipal service provider to unincorporated areas through annexation and incorporation. However, forced annexation and incorporation is a policy no level of government is likely to embrace. Most unincorporated areas remain so because they are either rural or, in the case of urban areas, not desirable areas of annexation to the surrounding cities. Given the limitations on property tax revenues, most cities are unlikely to annex areas of the county that have low property values or that offer little sales tax revenue. At the same time, the county officials we interviewed did not they think that the county’s role as a service provider to unincorporated areas should be eliminated, arguing instead that the level of services provided to those areas is equivalent to the level they would otherwise receive. 4. The contract city is an efficient means of providing municipal services at both the county and city level, and offers one model for local governments working closely together to provide local services. Another issue raised by those interviewed was the efficacy of the contract city model, given its prevalence in the county. Although opponents of contract cities argue that residents countywide are subsidizing the overhead costs of providing these services through the county, our analysis indicates that this is not the case or that there are sufficient other factors—including economies of scale—that justify the contracting of services. At both the county and contract city level, those we interviewed resoundingly felt that the contract city model resulted in the most efficient allocation of services and was a positive relationship for both sides. xx 5. Reliance on sales tax revenues, particularly in the case of contract cities, creates an incentive to prioritize commercial growth and development over housing and other regional needs. Although we did not analyze the fiscalization of land use in great detail (see Lewis and Barbour, 1999), one issue emerging from our analysis is the incentive the sales tax provides for favoring retail business over housing and regional economic needs. Such fiscalization does seem likely, given cities’ reduced reliance on traditional revenue sources, such as the property tax. Contract cities, in particular, rely heavily on sales tax revenues to pay for the services they receive. Fiscal and Organizational Alternatives There is general consensus about what the Los Angeles County government needs to do to get ready for the growth and change that will occur in the 21st century. Four particular goals emerged from the interviews and were validated by our analysis of the revenue and expenditure data. We endorse the goals and their importance. However, we do not endorse any of the specific suggestions mentioned in the interviews (and listed below) for arriving at these goals. Rather, the approaches for reaching these goals must depend on the development of a consensus among state and local government officials, civic leaders, and residents. 1. More Fiscal Control. Suggestions emerging from the interviews for increasing fiscal control included giving a greater portion of property tax revenues to county and local governments, returning control of the property tax to local governments, distributing sales tax revenues on a per capita or constituency-served basis, earmarking a portion of the state income tax for county government, changing from a two-thirds majority xxi vote requirement to a simple majority requirement for approval of tax measures, and reducing minimum-service-level requirements placed on the county by state government. 2. Expanded Partnerships. Suggestions included increasing contract relationships with cities, expanding partnerships with cities, nonprofit organizations, and the private sector—especially for providing health services—and establishing a forum for interaction on service issues between the county, other local governments, and the private sector. 3. Greater Responsiveness. Suggestions included increasing the number of county supervisors, electing a county mayor or chief executive officer, making the budget process more understandable to the public, and utilizing performance-based budgeting. Other suggestions included improving public relations, particularly with the Latino media, increasing the use of the Internet for information and services, and monitoring citizen satisfaction through public opinion surveys. 4. Increased Regional Focus. Emphasizing the county’s role as a regional service provider was mentioned by many of those interviewed. Suggestions included eliminating the county’s role as a municipal service provider to unincorporated areas by encouraging annexation or incorporation of these areas, creating a municipal services district for funding and delivering services specifically for these areas, and distributing sales tax revenues on a per capita basis to make these areas more capable of financing their own service provision. Other suggestions included increasing contract relationships with cities, expanding the number of locally based county offices to increase the county’s presence in the region, prioritizing housing needs, providing a forum for interjurisdictional cooperation, and eliminating the county’s involvement xxii with dependent districts, either through consolidation of these districts or relinquishing county control over them. Clearly, there is recognition that county government has made great strides in recent years as a result of better management and a growing economy. But the consensus is that county government will need to build on these recent accomplishments if it is to effectively meet current service needs and to prepare for the two million more residents who will call Los Angeles County their home in the next 20 years. This preparation will require public policy discussions and consensus building among county residents and their elected officials. The four goals presented above—emerging from our interviews and fiscal analysis— offer a framework and reason for having these discussions. xxiii Contents Foreword..................................... iii Summary..................................... vii Tables ....................................... xxvii Acknowledgments ............................... xxix 1. INTRODUCTION ........................... Goals of This Study ........................... Methods .................................. Perceived Fiscal Strains and Organizational Stresses...... Analyses of the County’s Role as a Regional and Municipal Government............................. Fiscal and Organizational Alternatives .............. The Los Angeles Context ........................ Organization of This Report ...................... 2. PERCEIVED FISCAL STRAINS AND ORGANIZATIONAL STRESSES ................. Perceived Fiscal Strains ......................... Perceived Organizational Stresses ................... 3. THE COUNTY AS A REGIONAL GOVERNMENT .... The County as an Independent Government ........... Challenges the County Faces as an Independent Government............................. 1 6 7 7 8 9 10 14 15 17 22 29 31 33 xxv The County as an Administrative Agent of the State and Federal Governments ....................... Challenges the County Faces as an Agent of the State and Federal Governments ....................... Special Case Study: Health Services ............... Fiscal and Organizational Issues Relating to the County’s Role as a Regional Government ................ 36 38 42 45 4. THE COUNTY AS A MUNICIPAL GOVERNMENT ... Overview .................................. Services Provided by Municipal Governments ........... Mechanisms for Providing Services .................. Direct Provision ............................ Special Districts ............................ The County as a Contract Service Provider ........... Some Issues Related to the County’s Role as a Municipal Government............................. 49 49 50 53 54 56 59 68 5. CONCLUSIONS: FISCAL AND ORGANIZATIONAL ALTERNATIVES ............................ More Fiscal Control ........................... Expanded Partnerships ......................... Greater Responsiveness ......................... Increased Regional Focus ........................ 71 72 77 79 83 Appendix A. Departments in Los Angeles County ................ 89 B. Los Angeles County Departmental Expenditures, by Role, 1997–1998................................. 91 C. Los Angeles County Departmental Revenues, 1997–1998 ... 95 D. Sample City Revenues, 1997–1998 ................. 107 E. City Service Overview Matrix ..................... 115 F. City Expenditures, by Department or Program, 1997– 1998 ..................................... 131 G. City Contract Expenditures, by Department or Program, 1997–1998................................. 139 Bibliography .................................. 147 About the Authors ............................... 151 xxvi Tables 1.1. Los Angeles County Characteristics .............. 2.1. Individuals Interviewed ...................... 3.1. Los Angeles County Expenditures, by Role and Institutional Structure, 1997–1998............... 3.2. Responsibilities of the County as an Independent Government ............................. 3.3. Los Angeles County Revenues, 1997–1998.......... 3.4. Agency Roles of Los Angeles County ............. 4.1. Sample of Other Local Governments.............. 4.2. List of Municipal Services ..................... 4.3. Los Angeles County Municipal Services Provided, by Department and Institutional Arrangement, 1997– 1998 .................................. 4.4. Los Angeles County Cities Receiving Municipal Services from the County, 1997–1998 .................. 4.5. Contract Services, by Full-Service and Contract City, 1997–1998 .............................. 4.6. City General Fund Revenue Sources, 1997–1998 ...... 11 16 31 32 34 38 51 52 55 58 63 65 xxvii 4.7. Full-Service and Contract City Expenditures, 1997– 1998 .................................. 67 5.1. Suggestions for Increasing Fiscal Control ........... 73 5.2. Suggestions for Expanding Partnerships ............ 78 5.3. Suggestions for Improving Responsiveness .......... 80 5.4. Suggestions for Increasing the County’s Regional Focus .................................. 85 B.1. Los Angeles County Departmental Expenditures, by Role, 1997–1998 .......................... 92 C.1. Los Angeles County Departmental Revenues from Taxes, Service Charges, and Fees, 1997–1998............. 95 C.2. Los Angeles County Departmental Revenues from Other Sources, 1997–1998 ........................ 101 D.1. Sample City Revenues, 1997–1998............... 108 E.1. City Service Overview Matrix .................. 116 F.1. City Expenditures, by Department or Program, 1997– 1998 .................................. 132 G.1. City Contract Expenditures, by Department or Program, 1997–1998 .............................. 140 xxviii Acknowledgments This idea for this study began with a conversation two years ago between David Lyon, President and CEO of the Public Policy Institute of California, and Gil Garcetti, District Attorney of Los Angeles County, after a briefing by Mark Baldassare on the Orange County bankruptcy. Over the course of the next year, a proposal for research took form through meetings between PPIC staff and elected and appointed officials in county government. These discussions culminated in a “Memorandum of Understanding” in September 1998 between David Lyon and David Janssen, Chief Administrative Officer in Los Angeles, to conduct a study of the role of county government in providing local services. Michael Shires and Mark Baldassare were the co-principal investigators on this project. They recruited Chris Hoene from Claremont Graduate University to manage the research project in Los Angeles and hired Aaron Koffman to provide research assistance in San Francisco. We wish to thank Michael Teitz, Fred Silva, and Paul Lewis at PPIC for their advice at various stages of the study. We received xxix invaluable help from David Abel of the Metropolitan Forum and Los Angeles County Citizens’ Economy and Efficiency Commission. We are especially grateful to David Janssen and his staff for their assistance at every stage of this project. We consulted with staff members Sandra Davis, Laura Jessee, and Martin Zimmerman and were assisted by Gwen Andrizzi on a regular basis. We also wish to thank Michael Teitz, David Janssen, Steven Erie, Fred Silva, and Dean Misczynski for their comments on an earlier draft of this report. The authors made the final decisions on the study’s scope and content, and all of the opinions expressed in this report reflect those of the authors alone. xxx 1. Introduction Local governments in California today face serious constraints whenever they want to increase local funding for the services they provide to residents. These constraints began when the voters passed Proposition 13 in 1978, which limited increases in local property taxes, lowered the existing tax base to 1 percent, and required local governments to seek a two-thirds majority from their voters whenever they wanted to raise local taxes. A series of legislative acts, in response to Proposition 13 and its political aftermath, has placed the state government in the dominant role of allocating revenues to the cities, counties, school districts, and other governmental entities that are responsible for providing local services to residents. The state’s fiscal power over local services is even stronger when we consider that the supermajority vote needed to raise local taxes is often difficult to achieve because many voters do not trust their governments. The effects of the state’s strong role in allocating revenue for local services have for many years been an issue of controversy. Some 1 observers claim that the separation of fiscal responsibility from service accountability breeds public confusion and, ultimately, voter cynicism about the role of government in their daily lives. Others say that the current level of state involvement in service provision is inefficient, because local governments have too little control over the decisions affecting their residents. Still other experts are not concerned about the separation of revenue collection and spending. They argue that Proposition 13 and its progeny have given the California voters what they want—government that delivers local services at the lowest cost possible without the threat of unwanted tax increases by their local governments. To date, there is little evidence to support any of these strongly held positions. In recent years, the fiscal calamities that have befallen California’s local governments have led to a closer examination of, and calls for change in, the state and local fiscal relationships at the foundation of local service provision (Baldassare, 1998a; Hoene, 1998; Shires, 1999). The latest round of reform discussions began soon after the state took back billions of dollars that it previously had allocated to local governments, so that it could reduce the ballooning state budget deficit during the recession in the early 1990s. Fiscal calamities followed the local funding reductions, including the Orange County bankruptcy, a near meltdown in Los Angeles County, and financial problems in several rural counties in Northern California. Some have argued that these problems were caused by local actions rather than by the state, although others claim that local governments no longer have the tools they need to adjust to a loss of state funds. As the California economy improved in the late 1990s, and as large budget surpluses led to more generous revenue allocations to local 2 governments from the state, the mention of fiscal problems by local governments diminished. Yet calls for state and local fiscal reform continue, including requests that the state government return property tax revenues to local governments. Local governments are quick to point out that their next fiscal crisis is just a recession away, unless the state government is able to provide them with more control over the revenues and expenditures involved in providing services to their local residents. We decided that the best way to address the issues related to the public finance of local services in California was to study them at the county level. County government is of particular concern given its responsibility for providing health and welfare services to an increasingly large population in the state. Moreover, county governments are highly dependent on state revenues for providing services to local residents. The size and significance of Los Angeles County in California’s structure of governance made it the ideal choice for this purpose. The County of Los Angeles, like all other counties in the state, serves as a principal local government for its residents. This role emerges as a result of the division of the state into 58 distinct regions or counties. Los Angeles County, established in 1850, was one of the state’s original 27 counties. The challenges and issues that the county faces as a regional government are often mirrored in the state’s other 57 counties, and especially in California’s large urban counties. This is because all of the county governments share a common system of state and local government financing of local services that has been shaped by a variety of forces, including the state Constitution, Proposition 13 and its legislative responses, and federal laws and programs. Thus, the findings and conclusions of this report, although obviously of special significance 3 to Los Angeles County and other large urban counties, are relevant to even the smallest and most rural county governments in California. We chose Los Angeles over other counties for several reasons. It is by far the most populous county in the state and, for that matter, in the nation. It is more demographically diverse than any other urban county in the state, offering a glimpse into California’s future. And it recently experienced fiscal problems that serve as an early warning signal of the future challenges it faces in using state and local funds to provide local services (see Legislative Analyst’s Office, 1995). Moreover, the long history of having numerous “contract cities” rely on county government to provide their municipal-level services offers unique lessons about the importance of city-county relationships. Finally, the fact that the county government is also the major provider of many local services for the large populations living in unincorporated areas offers an opportunity to analyze the dual role of the county as a regional government that provides services as an agent of the state and as a local government for those living in incorporated cities. Over the past decade, for example, Los Angeles County has struggled with the problem of keeping its public health and hospital system solvent. The recession of the early 1990s exerted tremendous pressure on the county’s budget and exposed a great weakness in the county’s portfolio of local services—its public hospital and clinic system. During the recession, a combination of reduced county income, state transfers of revenues from the county to the education system, and reductions in federal aid payments resulted in a county budget that hovered dangerously close to bankruptcy and threatened the closure of much of the county’s hospital system. A federal government bailout of the county’s health system—still in force—has allowed the county to avert 4 financial disaster; but despite the bailout, the county continues to underwrite approximately $100 million in hospital costs from its general fund. Without federal assistance, the health department would face a large annual deficit. In our study, we define the services provided by local governments in the broadest sense possible. Some define public services as those activities that cannot be offered efficiently and adequately by the private sector. Others consider public services as activities that governments engage in for the betterment of individuals, communities, and society. Still others see public services as any government activities that affect certain problems and achieve specific goals. We define local services as all of the activities provided by local governments for the benefit of their residents, as measured by their expenditures. Our definition does not differentiate between so-called “essential” services—such as police, fire, and sanitation—and “nonessential” services such as libraries, parks, and recreation. Local services by our definition could be provided to geographical areas of different sizes, including a neighborhood, city, county subarea, county, or multicounty region. Our study of Los Angeles County government commenced in September 1998. We had the full cooperation of senior leadership in the Chief Administrative Office. Our objective was to study local service delivery and the supporting financial structure. We held ourselves to a one-year timetable, so that we could provide information in a timely fashion to the Chief Administrative Officer and other interested local parties, such as the Los Angeles County Citizens’ Economy and Efficiency Commission, as well as the Speaker’s Commission on State and Local Government Finance. 5 Goals of This Study This study had four interrelated goals. 1. Identify the fiscal strains and organizational stresses in the provision of services, as perceived by those familiar with Los Angeles County. We wanted to understand the challenges the county government faces today in providing local services and the opportunities for changes within state, county, and other local government relations. Rather than devising hypotheses only from the fiscal databases, we talked with a number of individuals who are highly informed about the issues. We conducted interviews with a selected sample of county, state, city, special district, and regional officials and civic leaders. 2. Describe and summarize the system for financing countyprovided services. We created a database that included all of the local services the Los Angeles County government provides to its residents, how much was spent for each service, and how each service was paid for. For our study’s purposes, we defined county-provided services as all programs in the county’s 37 departments. We identified 276 countyprovided services, as well as their revenues and expenditures. 3. Describe the broader context of service provisions and revenue collections by other jurisdictions in the county, including cities, special districts, and special agencies. We developed a database of services provided by local and regional governments, so that we could contrast their service data with the county government statistics. This allowed us to understand what services other local and regional governments provide, how much they spend on each, and where they get their funds. Given the very large number of governmental units, we selected a sample that reflects the service activities of a wide range of cities, special districts, and regional agencies in Los Angeles County. 6 4. On the basis of both qualitative and quantitative analysis, identify alternative fiscal and organizational arrangements, if appropriate, for the provision of countywide and local government services. We sought to offer general suggestions about important goals for the county government. We also offered a list of alternative arrangements for providing county services based on our extensive interviews and budget information. We focused on possible changes in the areas of state and county relations, county and local relations, and current activities within county government. Methods The methodology we followed in meeting the four goals of this project is briefly described below. Additional information on our methods is presented in the appendices. Perceived Fiscal Strains and Organizational Stresses We conducted in-depth interviews with people who were highly knowledgeable about service provision. This included elected and appointed officials from county, state, city, special district, and regional governments and community leaders from nonprofit, business, labor, media, academic, and civic organizations. We contacted every member of the county board of supervisors and most of the county’s elected officials and major department heads and asked them to participate in the study. Most agreed to be interviewed in our March to July 1999 time frame. Everyone who was interviewed was granted anonymity, in that their names would not be associated with quotes in this report, to elicit their candid comments. We did tape the interviews to have accurate quotes in the report. A total of 31 interviews were completed, 7 mostly in person, with a few by telephone. The interviews typically lasted from 30 minutes to one hour and included such topics as state and county fiscal relations, county-local relations, and the roles and operations of county government with respect to municipal services in unincorporated areas, contract cities, health care, and regional services. We also asked these people for their views about the future of Los Angeles County and how expected changes might affect the role of county government. Analyses of the County’s Role as a Regional and Municipal Government We derived our data from the 1997–1998 county budget reports (the most recent county fiscal data available at the time the study began). The budget numbers were initially coded from the “County of Los Angeles: 1998–1999 Proposed Budget,” which breaks down the 1997– 1998 proposed budget appropriations and revenues for 276 programs within each of the county’s 37 departments.1 We then updated these data with the “County of Los Angeles: 1997–98 Final Budget,” correcting for the changes occurring after the proposed appropriations. We contacted county departments for more-detailed budget information and clarification, which enabled us to code the county revenues and expenditures into service categories. Keeping in mind the goals of the project, we designed our statistical efforts to provide a descriptive analysis of the local services reported in the county budget. To provide additional context for the county’s role as a municipal service provider, we studied a sample of 24 cities in Los Angeles County. ____________ 1The county’s departments are listed in Appendix A. 8 Special care was taken to create a broad cross-section of cities. We drew our sample from different regions, each of the five county supervisorial districts, contract and noncontract cities, older and newer municipalities, larger and smaller cities, and cities with varying social, economic, racial and ethnic, industrial, and tax-base profiles (see Table 4.1). We identified the revenues, expenditures, and services provided in our sample cities with the attention to detail as our work at the county level. To ensure comparability with the county government statistics, we derived these data from the 1998–1999 proposed and annual city budgets, which contain final numbers for 1997–1998 at the program level. We also gathered budget data from several special districts, functional assessment districts, and property tax agencies, as well as regional agencies and joint powers authorities. Since there are a large number of special districts, we chose the governmental entities that involve most of the expenses for the services to Los Angeles County residents (see Table 4.7). We used the data reported for 1997–1998 in their 1998–1999 budgets. Our purpose here, once again, was to provide a descriptive analysis of the local governments’ budgets with regard to local services.2 Fiscal and Organizational Alternatives On the basis of both qualitative and quantitative analysis, we sought to identify alternative fiscal and organizational arrangements, if appropriate, for the provision of countywide and local government ____________ 2Two notable omissions from the “other local services” category are school districts and redevelopment agencies (RDAs). Given the number and complexity of issues related to school district funding and service provision, an analysis of school districts would require an independent study of at least the scope of the current study. School districts are therefore excluded. Similarly, confronting the range of issues raised by redevelopment agencies would have required a significant diversion from the study’s goals and methodology. For an analysis of redevelopment agencies, see Dardia (1998). 9 services. The project staff each had primary responsibility for different parts of the study, depending on their areas of expertise. Michael Shires analyzed the budget data on county-provided services. Christopher Hoene analyzed the budget data on services provided by other Los Angeles County government entities. Mark Baldassare analyzed the interviews on fiscal and organizational stresses. Aaron Koffman assisted in all three areas. The authors together drafted a set of goals for the county government and a list of alternative fiscal and organizational arrangements, based on the suggestions that were made by those participating in our interviews. In doing this it is not our intention to make a specific set of recommendations or to advocate certain policy changes. Instead, we offer a broad and diverse list of proposals for consideration by local, county, and state policymakers. The Los Angeles Context Los Angeles County is the most challenging environment in the state for local governments to provide services to their residents. Table 1.1 presents a demographic profile of the county, the most populous in the nation with over 9.6 million residents in 1998. The county includes nearly 30 percent of California’s population. It has grown by over two million residents in the past 20 years. In the process, it has changed from a majority white to a “majority-minority” county (i.e., no single racial or ethnic group makes up a majority), receiving more immigrants than any other region of the country except New York. Today, the county’s population is 44 percent Latino, 34 percent white, 12 percent Asian, and 10 percent black. Los Angeles County’s population is projected to increase by another two million by 2020. In the future, Latinos will be 10 Table 1.1 Los Angeles County Characteristics Population, 1998: 9,603,300 (28.9% of California’s total population) Ethnic Distribution of Los Angeles County, 1998 Ethnicity/Race Latino White Asian Black % Share of Population 44 34 12 10 Total 100 Ten Largest Cities in Los Angeles County, 1998 Los Angeles Long Beach Glendale Santa Clarita Torrance Pomona Pasadena Lancaster Inglewood Palmdale Unincorporated areas 3,722,500 446,200 197,600 143,800 143,600 143,200 140,400 127,100 118,500 117,300 997,000 Public Finance Expenditures in Los Angeles County, 1995–1996 Local Government County Cities School districts Special districts Redevelopment agencies Expenditures ($ billions) 10.9 12.2 8.5 2.8 1.5 % Share of Total Local Expenditures 30 34 24 8 4 Total 35.9 100 SOURCES: California Department of Finance (1998, 1999). 11 the majority group (Baldassare, 2000; United Way of Greater Los Angeles, 1999; California Department of Finance, 1998). The demography of Los Angeles County has created a diverse and complex urban region filled with stark contrasts. This social and economic profile has great bearing on the delivery of local services to residents. The county includes some of the poorest and richest communities in the country. Income inequality is highly evident in the population, with the largest number of poor of any metropolitan area and a higher proportion of upper-income households than elsewhere in the state and the nation. Nearly one out of three children lives below the poverty level. Housing is generally expensive and scarce, resulting in more renters than homeowners, the second highest ranking on “excessive” housing costs in the nation, the highest ranking in crowded housing among large metropolitan areas, and an estimated quarter million homeless. About one million residents—10 percent of the county’s population—are currently 65 and older, and this number will increase over the next two decades. One in three adults and one in four children have no health insurance, for a total of 2.7 million residents, largely as a result of low-wage, part-time, and temporary work. Yet, Los Angeles County is also a place with great personal and corporate wealth, which contributes to the region’s potential for addressing some of its formidable needs for services. Nearly 18,000 nonprofits operate in the county, raising $4.9 billion annually in income, with $27 billion in assets (United Way of Greater Los Angeles, 1999). The structure of local government that delivers services in the area is large and complicated, reflecting the geographical size and social diversity of this urban region. The latest figures place the total tax receipts for all local governments at $36.5 billion in fiscal year 1995–1996. Total 12 expenditures for local governments during that same fiscal year were $35.9 billion. Of these funds, 30 percent were spent by the county government ($10.9 billion), 34 percent by the city governments ($12.2 billion), 24 percent by the local school districts ($8.5 billion), 8 percent by the special districts ($2.8 billion), and 4 percent by the redevelopment agencies ($1.5 billion), according to the California Department of Finance (1999). Los Angeles County includes 88 cities. The largest city is Los Angeles with 3.7 million residents. Six other cities have populations of more than 130,000: Long Beach, Glendale, Torrance, Pomona, Pasadena, and Santa Clarita (Swenson, 1999). Nearly one million people, or one in 10 county residents, live in unincorporated areas, receiving their municipal-level services from the county government. There are 58 “contract cities” for which the county government, or another agency, provides municipal-level services on a contract basis.3 The county provides police protection to 41 cities on a contract basis. Fifty-four cities receive fire protection and 51 cities receive library services from two property-tax agencies: the Los Angeles County Fire District (LACFD) and the County Library District.4 Los Angeles County also includes more than 200 special districts that provide services such as water, sanitation, library, and fire services. The county government itself is one of the largest public bureaucracies in the ____________ 3Contract cities are defined here as the cities that are members of the California Contract Cities Association. 4At times throughout this study, we will refer to cities that receive fire and library services through these property-tax agencies as “contract cities.” In most instances, this is the case because the majority of these cities are also members of the California Contract Cities Association. 13 country, including over 84,000 employees in 37 departments delivering local services through 276 programs. Organization of This Report This report is organized around the four goals presented above. Chapter Two summarizes the themes from our interviews with government officials and civic leaders. Chapter Three examines the fiscal data on the issue of the county’s role as a regional government. Chapter Four examines the fiscal data on the issues of the county’s role as a municipal service provider and also provides insights into how the county’s role relates to the role of cities and special districts in providing the same or comparable services. Chapter Five provides a summary of the goals and the list of policy alternatives for addressing the problems and issues raised in this report that were suggested by those participating in our interviews. 14 2. Perceived Fiscal Strains and Organizational Stresses To better understand the current context of service delivery in Los Angeles County, as well as the challenges facing the county government and other local governments that are charged with this task, we interviewed state and local officials and civic leaders who are highly informed about the role of county government in proving local services to Los Angeles County residents. Table 2.1 lists the individuals we interviewed in this portion of the project. We describe below several themes that emerged during our interviews, and we also include a number of direct quotes from those we interviewed. The observations we include do not necessarily represent the facts about fiscal and organizational conditions of Los Angeles County, but we used these observations to formulate hypotheses to be explored in our quantitative analysis of the fiscal data and to guide us in thinking about alternative fiscal and organizational arrangements for providing local services. 15 Table 2.1 Individuals Interviewed Name, Title, Affiliation David Abel, ABL Inc., Los Angeles County Citizens’ Economy and Efficiency Commission Michael Antonovich, Supervisor, Los Angeles County Leroy Baca, Sheriff, Los Angeles County James Bickhart, Field Representative for Speaker Antonio Villaraigosa Yvonne Brathwaite-Burke, Supervisor, Los Angeles County Larry Calemine, Director, Local Agency Formation Commission, Los Angeles County Michael Colantuano, City Attorney, Cudahy and La Habra Heights Rick Cole, City Manager, Azusa; Former Mayor, Pasadena Keith Comrie, Former Chief Administrative Officer (CAO), City of Los Angeles Diane Cummins, Chief Fiscal Policy Advisor, President Pro Tempore John Burton Ron Deaton, Chief Legislative Analyst, City of Los Angeles Mark Finucane, Director, Health Services, Los Angeles County Joel Fox, President Emeritus, Howard Jarvis Taxpayers Association Michael Freeman, Fire Chief, Los Angeles County Fire District William Fulton, Editor, California Planning and Development Report Gil Garcetti, District Attorney, Los Angeles County Joe Haggerty, President, United Way of Greater Los Angeles James Hankla, Chief Executive Officer, Alameda Corridor Transportation Authority David Janssen, Chief Administrative Officer, Los Angeles County Monica Lozano, Executive Editor, La Opinión Harry Peacock, City Manager, Malibu Mark Pisano, Executive Director, Southern California Association of Governments John Perez, Executive Director, United Food and Commercial Workers Union, Region 8 Alexander Pope, Director, California Citizens’ Budget Commission Sally Reed, Chief Administrative Officer, Monterey County; Former CAO, Los Angeles County Constance Rice, Co-Director, Advancement Project James Stahl, Assistant General Manager, Sanitation Districts of Los Angeles County Harry Stone, Director, Public Works, Los Angeles County Steve Szalay, Executive Director, California State Association of Counties Dan Wall, Chief Legislative Representative, Los Angeles County Zev Yaroslavsky, Supervisor, Los Angeles County 16 Perceived Fiscal Strains 1. The county government has little control over the revenues it generates and the money it spends on services for residents. The fact that our respondents thought that the county government does not have the tools to financially cope with the next economic recession is a reflection of their views about state and local fiscal relationships. As a result of Proposition 13, there is a widespread perception that county government has lost control of its major revenue source—the local property tax. Most recognize that the two-thirds majority needed from voters to raise local taxes has severely limited local governments’ abilities to generate new revenues. “Governmental units charged with providing services do not have the power in the current system to establish priorities and effect change,” remarked a civic leader. “The county is especially put upon in that all of its revenue-generating authority has been taken away,” said a state official. “Counties, more than any other form of government, are at the mercy of circumstances outside of their control,” said an elected county official. “The biggest problem we face is the loss of our property tax base,” said another elected county official. This comment reflects the belief that, in filling the service needs of residents today, the county government has become very dependent on state money that usually arrives with strings attached. This circumstance is perceived as leaving county officials with little room for maneuvering in the types and amounts of services they are providing on an annual basis—and little flexibility when revenues and expenditures vary sharply from budget projections, as can be the case during severe recessions. “Since Proposition 13, the real decisionmaking authority for local government resides in Sacramento,” observed a local official. “County government 17 lost the independence it had prior to Proposition 13. Its ability to control its own destiny was taken away,” said a former county official. “We haven’t capped the county’s liabilities, but we have capped the county’s revenues,” said a state official. 2. State, federal, and county governments are partners in delivering local services, but uncertainties about state and federal funding and mandates create tensions. Most respondents felt that the success of service delivery in Los Angeles County depends on a healthy relationship between the state and county governments. Sacramento needs the cooperation of the county to be the “agent of the state” in delivering certain essential services at the regional level, and the county needs the financial wherewithal from Sacramento to provide other local and countywide services to its residents. There was a feeling that the tensions surrounding current state and local fiscal relationships—partly the result of the state taking back funding from the county during the last recession—had done some harm to this key partnership. Some felt that the relationships had improved in recent years as a result of changes in county management and a less stressful budget environment. Still, everyone seemed to agree there was room for improvement. “The state needs to be a true partner with county government,” said an elected county official. “I think we need to move away from a paternal relationship with counties and toward a true partnership. Having a more open and honest dialogue would help both sides,” said a state official. “The state needs to be realistic about what they expect from counties and about what they mandate," observed a former county official. “If the economy takes a turn for the worse, and the state balances its budget on our backs, we’ll be right back where we started,” said an elected county official. “Certainly, the state continuing to take 18 money away from Los Angeles County is a problem. They take away the property tax, give back a little of the sales tax, effectively undercutting local control by taking away the home base,” said a civic leader. “All we hope is that the state will leave us alone and let us manage our own affairs. What we need from the state is a stable, reliable source of income,” remarked an elected county official. “The county leadership is justified in feeling that they shouldn’t be underfunded [i.e., with reference to mandates]. If the state is going to force them to implement certain programs, than the funding should be provided,” said another state official. 3. Health care is a chronic and unsolved problem facing countyprovided services. The county government came close to a fiscal meltdown in 1994–1995 and was saved by a federal rescue plan that paid for the county’s ballooning health care deficit. Although the immediate crisis was averted, no one today seems to think that the problem has been resolved. There are a variety of opinions on the severity of the problem, but consensus that providing health care to the large, uninsured population of Los Angeles County is the most worrisome issue for county government. Most realize that the county government is heavily dependent on a continued federal bailout, and everyone knows that this funding source will not continue indefinitely. “We’ve turned it around, but it could definitely happen again,” predicted an elected county official. “Besides the federal waiver, the county has done some cost cutting since the crisis and has saved themselves about $90 million a year. But, it probably still needs to find a $100 million more,“ said a state official. “Most importantly, the number of uninsured people in Los Angeles County continues to grow rapidly,” observed a county department head. “It is certainly a possibility that the 19 crisis could emerge again. The demands are still enormous,” said a county official. “The county could absolutely find itself in dire straits again,” remarked a regional official. Despite recognition that the federal bailout will not continue indefinitely and the likelihood of another crisis when a recession hits, there is also consensus that county government does not know how to solve the problem. “The deficit is structural and the county has little control over fixing it,” observed one civic leader. “There is no game plan to this day on the part of the county. I haven’t seen that they’ve learned from the crisis,” said a regional official. “It is probably five years until the next crisis,” warned another county official. “I’m not sure that anyone knows what to do about it,” admitted a county elected official. 4. The scarcity of local revenue sources may be leading to decisions that favor commercial growth and local sales tax dollars over the region’s housing and economic needs. More jobs and more affordable housing should certainly be among the priorities for the largest urban county in the state, especially given the level of poverty in the current population and the expected population growth over the next two decades. Many of the leaders we spoke to felt that local development decisions were leaning too much in the direction of retail and commercial building, at the expense of residential and industrial construction, because the former generates new sales tax revenues for the locality and the latter does not (Lewis and Barbour, 1999).1 The ____________ 1Lewis and Barbour (1999) found that local public officials favor retail development over other forms of development, but it is unclear whether this preference has affected urban form. First, there is no evidence to suggest that California has more retail space per person than other states. Second, it is questionable whether the favor given to retail actually leads to differences in retail location. However, Lewis and Barbour also note that 20 proliferation of municipal redevelopment agencies and the system of finance supporting these agencies is also cause for concern (Dardia, 1998). In an era in which local governments have few options for raising their revenues, many local leaders are concerned that the “fiscalization of land use” results in too many local growth decisions being made to raise tax dollars that are not really in the best interest of the region as a whole. “Our fiscal structure for local government is so skewed to sales tax and retail right now that there is no coherent community development,” said a civic leader. “Everybody agrees that the situs approach to sales tax needs to be modified, if not eliminated,” said another civic leader. “Unless we quickly move toward restructuring the state-local fiscal relationship and its impact on land use, we won’t be able to build livable communities in the long term that provide high-quality jobs,” said another community leader. “The current system of finance in the state spawns its own set of behaviors which only make the problems worse day by day,” observed a civic leader, in referring to the fiscalization of land use. 5. Fiscal uncertainties make long-term planning difficult, even though the county government is in better shape today than it was in the mid-1990s. There was near consensus that these are good fiscal times in county government, particularly compared to the dark days of the last recession. Many attribute these positive conditions to forces outside the county government’s control—specifically, the improved economy, increased tax revenues, a reduction in demand for welfare services, and a state budget surplus. Those inside county government also give credit to the management team and a better working ________________________________________________________ the more cities favor retail development over housing and industrial development the more difficult the latter land uses will be to develop. 21 relationship between the county supervisors, other elected officials, and the administrative staff. “Things are going reasonably well, certainly better than they were six years ago during the recession,” said an elected county official. “The professional management has improved dramatically. We’re now talking to each other about what might be coming around the corner,” said a county department head. Yet, there is a belief that the current good times are only temporary and that the county government will find itself in deep trouble again once the economy enters the next inevitable downturn. “I think it is fortuitous that the economy is doing as well as it is, otherwise it would be a disaster. If we have another recession soon, all of the cities and counties will go right back into the tank,” said a local official. “The county has done a terrific job within the past few years. Part of it is because the economy is good. Of course, the good times are only temporary,” said a state official. Perceived Organizational Stresses 1. The size of county government and the large number of local governments operating in the county lead to public confusion about local service delivery. Local government in Los Angeles County includes the county government (84,000 employees in 37 departments), 88 cities, and more than 200 special districts. Thus, it is not surprising that many of those we interviewed described the government in the county as big and unwieldy, whereas others believed that there were just too many cities and special districts. Some felt that the size and complexity of these governmental units led to a “fragmentation” in decisionmaking about 22 local services and a bureaucracy that was too difficult for the public to understand and access. “My overall view is that no one has a clue about what the county does. Part of it, I’m sure, is that LA County is just too big,” said a civic leader. “The county government is just an enormous set of bureaucracies, and it is very difficult to get them coordinated and moving in the same direction,” said another. “The county government is too big and detached to serve all of its residents,” said a city leader. “Having only five people in charge, plus a CAO, is a very difficult administrative structure,” said a civic leader. “We have too many special districts. There are tremendous inefficiencies,” said an elected county official. “Special districts are to government what inefficiencies are to the private sector, said another. “There is some efficiency in terms of how local governments work together, but the public has no clue who does what,” said a local official. Others commented that this situation is exacerbated by the large numbers of immigrants and non-English-speaking residents in Los Angeles County. “The county doesn’t reach out to the Hispanic community at all,” observed a civic leader. 2. The connections between state revenues and local expenditures are so complex that it is difficult to know who should be held accountable for local services. Many of the leaders were troubled by the appearance of a “disconnect” in state and local fiscal relationships that occurs now that local governments are so reliant on state funds. Today, most of the taxes collected at the local level are passed on to the state, which then redistributes the revenues to local governments. Among other things, the current system raises public doubts about what tax 23 money goes to what services, as well as confusion about which branch of government can really be held accountable for delivering those services. “The jurisdiction responsible for providing services needs to have the financial wherewithal to provide those services,” said a city official. “As long as you have the responsibility with the local governments, and the revenue authority with the state, there will always be problems,” said an elected county official. “There is no relationship between the collection of those revenues and the services they pay for,” observed a regional official. “The current system thwarts effectiveness,” said a civic leader. “All we’ve done is inherit an old system through voter and state intervention. It is a chaotic and dysfunctional patchwork,” said a city official. 3. Contract cities (i.e., those cities that provide public services through contracts with the county government) seem to offer an efficient means of providing local services, even though these longstanding city-county relationships are still controversial. The topic of contract cities has for many years generated controversy in Los Angeles County. As this report shows in the following chapters, significant differences exist between contract and full-service cities in how they generate revenues and allocate their resources. Some think that county government should not be in the business of selling local services to cities, and that it should focus its efforts, instead, on being a regional service provider. Large cities have complained that contract cities are not “real cities.” They argue that because county government is prohibited by state law from charging overhead costs to contract cities, the costs are unfairly subsidized by the other cities in the county. Others worry that county government is already stretched too thin to be providing local services to contract cities, and that making cityhood easier to achieve 24 through the contract city mechanism only increases the fragmentation of the region. “The contract model forces the county to give a subsidy to those cities. They don’t pass overhead costs on to those cities,” observed a regional official. “There are too many forms of cities right now. There are a lot of cities that aren’t really cities in the traditional sense,” said a city official. Others believe that the contract city arrangement reduces administrative overhead and service redundancies in the region. They argue that contract cities are a very efficient way to achieve local governance. Most of those we interviewed inside county government spoke only of the benefits of contract cities—such as additional revenues for the county government and incentives to increase efficiency—whereas civic leaders and officials in cities and special districts offered mostly positive but more mixed reviews of this special city-county relationship. “Allowing cities to exist through contracts with the county government allows them to focus on the issues they are primarily interested in—land use,” said one county official. “The upside is a lot of local control. The downside is that you have a more complicated environment in which to try to achieve regional policy,” said a city official. “The contract cities approach is still viable. It allows them to maintain their identities and it overcomes redundancy in service provision,” said a city official. “It is a good thing because it forces competition,” observed an elected county official. “If you believe in giving people a say in local governance, this is a very cost-effective way to go about it,” said another county official. “One of the benefits of Proposition 13 is that it forces efficiencies and different ways to deliver services, like contract relationships,” said one civic leader. “In terms of 25 contract cities, for the county’s purposes, it’s been good,” observed a state official. 4. Unincorporated areas may be an unwanted burden on county government, but many roadblocks prevent their incorporation or annexation by cities. About one million people in Los Angeles County, or approximately one in 10 residents, live in unincorporated areas. They are dependent on county government for their municipal-level services, because they have no city government. Again, this kind of local service activity reduces the county government’s ability to focus on its role of providing regional-level services. Given the revenue-generating limitations faced by the county government, many have suggested that unincorporated areas should be annexed by adjacent cities or incorporated into new cities, thus removing this service burden from county government. “My view is that unincorporated areas should be annexed or forced to incorporate. It gets back to the issue of what is county government,” said a city official. “The unincorporated areas should be annexed or incorporated. It would help the county figure out what it’s spending on municipal services,” said a civic leader. “There ought to be clearly defined levels of services, which means that these areas should be annexed or incorporated,” said a city official. “Counties should be regional service providers and shouldn’t be providing municipal-level services,” observed a state official. Most of the respondents in our study agreed with this idea in principle, though many understood why this process was not moving ahead. For the most part, residents in unincorporated areas seem to be satisfied with the services they are receiving and the cost of local government, so they are not seeking to incorporate, and adjacent cities 26 are in no hurry to annex land that is not generating sales tax revenues or enough property tax revenues to cover the costs of services. “Nobody wants the unincorporated areas right now because they are high cost, in terms of services, and don’t generate significant revenues,” said a county department head. “I think the unincorporated areas are very satisfied with the services they receive,” said a county elected official. “These islands exist for a reason. Either people don’t want to be part of cities, or the surrounding cities do not want to be part of these areas,” said a regional official. 5. County government should work more closely with other local governments, the private sector, and nonprofits in providing local services. Many of the state, county, and local officials and civic leaders we interviewed had a clear understanding of the limitations that the county government was operating under today. The county government could not possibly meet all of the demands for its services, either now or any time in the foreseeable future. This perception reflects a combination of demographic and institutional factors. There is a large and growing population of needy residents in Los Angeles County, but the opportunities for generating revenues to pay for increased services are limited. There is a widespread recognition that the county government needs to improve its ability to be a partner in providing services with other local governments. Although most felt that the relations between the county government and other local governments have improved, many felt that collaborative efforts were still too rare. “If the county, cities, and communities don’t develop a partnership, we won’t be able to deliver services effectively,” said a regional official. “A clearer delineation of roles between the counties and cities is needed, and regional cooperation should be encouraged,” said a city official. 27 “The key is to provide incentives for cities to cooperate,” remarked a civic leader. “People just don’t feel they have a shared stake in the region,” said a city official. “We need more metro government. We have 88 cities—which is kind of ridiculous. There is no natural grouping where different jurisdictions come together,” observed another civic leader. Others want the county government to more actively seek partnerships outside local government, specifically contracting with the private sector and taking advantage of the accumulation of wealth and talent in the nonprofit organizations throughout the region. To succeed, the county government must create a sense of purpose for the region as a whole—an endeavor seldom undertaken today. “The future of local government service provision will be public and private partnering,” said an elected county official. “Public-private partnerships are going to increase in the future. We need to overcome traditional thinking about service provision,” said a state official. 28 3. The County as a Regional Government In its regional role,1 the county has two responsibilities: (1) As an independent county government, it must respond to the needs and preferences of a countywide electorate, and (2) as an administrative agent of the California and U.S. governments, it must implement state and federal initiatives. Both responsibilities are considered part of the county’s regional role because the services provided are delivered to the entire region within the county. In each of these cases, the county government is seen as the vehicle of choice for implementing important regional policies. As an independent county government, the county is granted power and responsibilities by both the state Constitution and ____________ 1The term “regional” is used in this portion of the analysis to describe the county’s role as the overall government for a specific geographic region of the state, including as a superordinate entity with some jurisdiction even within the boundaries of incorporated and independent governments within its boundaries. It is narrowly construed to reflect this role and not in the broader sense of a cooperative effort by several subordinate governments to build and execute a collaborative agenda. 29 statute to locally elect a board of supervisors and to implement policies and make choices that reflect the interests and preferences of local residents. As an agent of the state and federal governments, the county is used as a vehicle to implement larger policy initiatives at the local level and, in some cases, to customize these initiatives to better reflect and accommodate local needs and interests. In both cases, the county government is specifically selected because of its proximity to its residents and constituents and because every person in California is located within the boundaries of a county government. The relative importance of these two aspects of Los Angeles County’s regional role is shown in Table 3.1 in comparison to its role as a municipal services provider (this role is discussed in Chapter 4). Here, we have categorized expenditures for Los Angeles County program by program for the 1997–1998 fiscal year and incorporated them under their respective county roles. The county’s role as an administrative agent of state and federal policy dominates, including 62 percent of expenditures, and its role as an independent county government accounts for 25 percent of expenditures. The remaining 13 percent of expenditures are for municipal services the county provides to both incorporated and unincorporated areas within its jurisdiction. The percentages in the table are derived from the $11.9 billion in total expenditures for both county departments and dependent districts; $11 billion or 92 percent of the total expenditures are from departments. In this chapter, we examine the importance of this distribution of expenditures and explore the issues associated with the county’s role as a regional government. We then briefly examine the broader context and issues raised by this regional role and its implications for local government finance and organization. 30 Table 3.1 Los Angeles County Expenditures, by Role and Institutional Structure, 1997–1998 Role County government Institutional Structure Dependent Departmenta Districts 2,913,284,557 114,752,300 Agent of state and federal governmentsb 7,151,849,582 175,144,100 Municipal service provider 943,098,422 604,004,738 Total 11,008,232,561 893,901,138 Total 3,028,036,857 7,326,993,682 1,547,103,160 11,902,133,699 Role County government Institutional Structure Dependent Departmenta Districts 26% 13% Total 25% Agent of state and federal governments 65% 20% 62% Municipal service provider 9% 67% 13% Total 100% 100% 100% aDepartment totals include budgetary allocations in the Health Services Department related to SB 855 and various miscellaneous funds controlled by county departments. bNote that $450,776,000 of interfund expenditures and $674,166,846 of SB 855 revenues for health services were excluded from these totals to avoid double counting these amounts. The County as an Independent Government Much of the county’s authority as an independent government is outlined in Article XI of the state Constitution and in the Government Code of the State Statutes, which assign a range of privileges and responsibilities to the county government and its elected body—the 31 board of supervisors. Table 3.2 provides a list of Los Angeles County’s responsibilities as an independent government. Included in this list are the county general government, such as the Board of Supervisors and the Chief Administrative Office, as well as the registrar of voters, office of weights and measures, tax assessor, tax collector, and clerk. Also Table 3.2 Responsibilities of the County as an Independent Government General Government Social Services Chief Administrative Adoptions Office Birth/Death Certificates Board of Supervisors Aging County Clerk Career Services and Job County Attorney Training Alternate Public Defender Disability County Counsel Community/Family Small Claims Counseling Assessor Bees/Insect Information Controller Treasurer Civil Services Finance Consumer Affairs Property Taxes Claims Property Ownership Veteran/Military Services Collections Marriage Dissolution Human Resources/ Fraud Personnel Job Information Affirmative Action Marriage Information Systems Ombudsman Legal/Legislative Recycling Annexations/Incorporations Economy and Efficiency Public Safety Commission Sheriff’s Department Elections Flood Control Voter Registration Chemical/Toxicology Purchasing Jails Smog Control Disability Worker’s Compensation Leisure and Cultural Services Parks and Recreation Cultural Centers Public Entertainment Youth and Senior Programs Planning Boundary Changes/Cities and Districts Incorporations of Cities Agricultural Agricultural/Weights and Measures Produce/Egg Quality Other Airports Marina 32 included is the Local Agency Formation Commission (LAFCO), a separate agency created by the state, whose job is to oversee boundary disputes within the county. The table also includes the Sheriff’s Department in its capacity both as the regional law-enforcement agency responsible for providing countywide coordination of law enforcement and as the operator of the county jail system. The Sheriff’s Department also serves a municipal role in the county, as discussed in Chapter 4. Challenges the County Faces as an Independent Government Perhaps the biggest challenge the county faces as an independent government is the pressure created by its public finance system. Although much of the blame for this pressure has been laid at the feet of Proposition 13—the landmark 1978 initiative to roll back property taxes and moderate their growth—many other factors contribute to the fiscal box in which most counties find themselves today. True, before Proposition 13, boards of supervisors did have the ability to raise property taxes to fund local county initiatives. But a closer examination of county revenues points to several other issues as well. Table 3.3 shows Los Angeles County’s revenues for the year of our analysis. When thinking about funding the county governance-related roles identified listed in Table 3.2, one would automatically look for countyderived and -determined revenues. In Table 3.3, this would include the property tax, the sales tax, other taxes, and service charges and fees (i.e., a revenue stream that reflects the government’s efforts to recapture the cost of service provision through user fees). In this table, we see that they total $3.29 billion, more than covering the $3.03 billion in county 33 Table 3.3 Los Angeles County Revenues, 1997–1998 Revenue Property taxesa Sales taxes Other taxes Service charges and fees Intergovernmental revenues Other revenues Debt proceeds Amount, $ 1,872,350,364 57,562,795 71,277,173 1,293,004,487 7,517,923,247 742,496,974 510,377,833 Share, % 15 1 1 11 62 6 4 Total 12,064,992,873 100 NOTE: A detailed departmental summary is presented in Appendix C. All internal fund transfers and $674,166,846 of SB 855 revenues were excluded to avoid double counting the amounts. aThis includes all property taxes under the control of the Los Angeles County Board of Supervisors. Of these taxes, $668,173,522 is generated by special district-funded activities (such as fire and library) and is not fungible for other purposes. government expenditures we identified in Table 3.1. However, of the $3.29 billion in property tax revenues, some $667 million represents property tax streams that are required by law to be spent on specific, municipal service-related activities, such as fire protection, storm drains, and street lighting. Thus, only $2.62 billion of these generally fungible monies is available to fund county government programs. Furthermore, these monies must also be used in many instances to provide municipal services to unincorporated areas, as discussed in Chapter 4. This property tax level is not, however, purely a result of Proposition 13. True, Proposition 13 did result in a significant reduction in property tax revenues overall and prevented locally elected officials from raising the property tax rate. However, during the recession of the early 1990s, 34 the state government sought to relieve the fiscal pressure on its budget by transferring a significant portion of city and county property tax revenues to school districts. The now-infamous Education Revenue Augmentation Fund (ERAF) has been the subject of significant debate today as county and city officials attempt to recapture these lost monies in the cash-flush times of the late 1990s. Another factor contributing to the fiscal pressure felt by the county is the lack of a local, diverse, discretionary funding pool. The property tax remains the primary component of the county’s local funding, and Proposition 13 eliminated both the local and the discretionary aspects of this revenue. Unlike cities, and especially charter cities, counties have very few alternative sources of revenues. Sales taxes and other taxes each account for only 1 percent of county revenues. In most cases, the county receives these revenues only for transactions within its unincorporated areas. With the sales tax, for example, the county can collect sales taxes only (1) for designated transit purposes, (2) for sales in unincorporated areas of the county, and (3) within city jurisdictions that have chosen not to assess their full share of the Bradley-Burns sales tax (currently, all cities are assessing their full share). Since unincorporated areas are historically sparsely populated and often incorporate once they grow large enough to generate significant sales tax, franchise fee, hotel tax, and business license revenues, the county has little opportunity to realize any significant revenues from these sources. At the same time, there is considerable local and state-level concern that the concentration of sales taxes at the city level creates counterproductive incentives for these governments that lead to a wide range of unintended consequences, including a shortage of housing and uneven economic development. Although this report does not examine 35 these issues in detail (see Dardia, 1998, and Lewis and Barbour, 1999, for a thorough analysis of some of these issues), many of the solutions discussed point to the need for a more regional allocation of these revenues—a result that, if properly implemented, could go a long way toward diversifying the county’s revenue pool and its reliance on the property tax. As a result of the current state-local fiscal relationship, the county faces considerable financial strain in trying to fund the activities associated with its role as a county government. Where do the additional monies come from to fund these activities? In many cases, they come from transfers from the federal and, especially, the state government. In recent years, for example, the state has increased the number of programs for which it provides direct funding and has, in some cases such as welfare reform, created incentive programs that allow counties to spend revenues in excess of costs on other purposes. The magnitude of the county’s reliance upon other levels of government for its revenue stream does not necessarily represent a problem if the other actors in the intergovernmental revenue process were to simply pass the revenues through with no strings attached. Unfortunately, this is usually not the case. Shires (1999) found that discretionary spending among local governments has fallen dramatically over the past 20 years, and especially for counties. The County as an Administrative Agent of the State and Federal Governments The second responsibility of Los Angeles County in its role as a regional government is to serve as an implementing agency for the state 36 and federal governments. As shown in Table 3.1, 65 percent of the county’s departmental expenditures and 62 percent of its overall expenditures are for activities resulting from edicts and policy actions by these two superordinate governments. This role is not new to county government. Since the early 1900s, counties in California have been the implementing arm of the state for a wide range of policy initiatives, such as care of the indigent and poor. Even as early as the 1920s and 1930s, a significant portion of California county budgets came from the state. (For a more detailed examination of the historical relationship between the state and counties in California, see Silva and Barbour, 1999.) Yet today, the situation is much more complex. Fiscal and structural pressures, such as those we discussed above, have rendered the county particularly vulnerable to any increased demands on its resources. The types of programs that the county administers in its agency role and the ways that the programs are assigned, however, lead precisely to the increased pressures and strains on the county budget. Table 3.4 lists the programs that the county undertakes in its agency role. Although these activities accomplish goals that are in county residents’ interests, they have traditionally been established, funded, and maintained by the federal and state governments. In the context of this analysis, these activities represent areas where the county serves as the implementation agent for broader state and national objectives. These programs largely include the county’s welfare support programs (funded primarily through federal dollars with major state oversight), the county’s hospital and public health enterprises, various federal jobs and housing 37 Table 3.4 Agency Roles of Los Angeles County Social Services Career Services and Job Training Community/Family Counseling Welfare Public Health Public Health Programs Hospitals Development and Housing Housing Assistance Development and Housing Public Safety Courts programs, and most mental health programs.2 In all of these cases, nearly all of the discretion relating to the eligible populations and the level of benefits is determined and funded by other levels of government. The court system is included here because it effectively functions as a state agency under the Trial Court Funding Act. Challenges the County Faces as an Agent of the State and Federal Governments From a broad perspective, the county’s agency role makes a lot of sense. The state and federal governments have very large geographic ____________ 2Until the budget crisis during the recession of the early 1990s, this responsibility was largely shouldered and administered by the state. After 1992, it was assigned to the county along with monies transferred to the county through the motor vehicle license fee—a revenue stream now being phased out. 38 boundaries and strive to set policy priorities that reflect state and national interests. At the same time, these two levels of government have very blunt policy instruments that are not particularly effective in responding to local needs, interests, and differences. Thus, they assign the implementation of their policy initiatives to units of government that (1) are locally elected and hence responsive to local preferences, and (2) encompass all of the physical geography of the state and nation—i.e., county governments. Three factors, however, are problematical: (1) unfunded mandates, (2) maintenance of effort requirements, and (3) unfunded operating costs. Each of these factors produces increased fiscal pressures on the county’s already limited resources. Unfunded Mandates. Unfunded mandates occur when the federal or state government requires the county to provide a service and does not provide sufficient resources to fund the activity. Although Proposition 4 in 1979 theoretically prevents the state from requiring local governments to provide services without providing the corresponding funding, two complications arise: (1) The definitions surrounding mandates are very narrow and take years to litigate,3 and (2) restrictions typically apply only to new state policy initiatives, and thus escalating costs in pre-existing programs are typically not factored into the equation. Mental health services are an excellent example of the latter issue. In 1991–1992, the state transferred control of the majority of the state’s mental health ____________ 3An excellent example of this problem, although not county-specific, is special education in California’s school districts. It has taken several years and a major lawsuit even to bring the state to the bargaining table to try to get the state to pay the actual costs of providing state-mandated special education programs, and yet the state continues to delay resolution on the issue. There is currently some pressure on Governor Davis to negotiate a settlement to the lawsuit, but it has yet to happen. 39 system to county governments as part of its “realignment of state and local government.” In this action, the state also transferred a revenue stream to counties in an effort to provide some funding for these services, although the funding was not at the same level that the state had previously spent on mental health. Concurrent with the growth in overall health costs during the 1990s, the unit cost of the mental health programs has grown dramatically. But the state has yet to review whether the revenue stream it provided in 1992 has grown enough to meet rising costs. In fact, in many cases, it has not, which has resulted in significantly lower levels of service provision or increased cost to the county’s general fund revenues. Maintenance of Effort Requirements. The costs of the county’s role as an agent of the state and federal governments is further exacerbated by the popularity of “maintenance of effort” and “matching fund” requirements in state and federal policy initiatives. These provisions require the county to meet federal- and state-defined levels of expenditures and program efforts to be eligible for support. The goal of such provisions in state and federal policy initiatives is twofold: (1) to encourage local governments to take specific actions consistent with the legislature’s intent and (2) to curtail abuses of monies made available to local governments. An interesting example of this kind of intervention is the ongoing debate over the size of Los Angeles County’s new general-purpose hospital, which would replace the quake-damaged, 870-bed Los Angeles County-University of Southern California Medical Center. State lawmakers are exerting pressure on the county government to make the new hospital larger (increasing its size from 600 to 750 beds) as a condition of receiving state dollars—not only for the project, but also for 40 other unrelated purposes. This pressure to expand continues, despite a 4-1 vote by the board of supervisors in favor of the smaller hospital, fueled by concerns over the county’s ability to fund the operating costs of a larger facility and by federal pressure to have fewer beds. Unfunded Operating Costs. The county’s role as an agent of the state and federal governments is accompanied by significant intergovernmental transfers. As shown in Tables 3.1 and 3.2, 62 percent of the county’s revenues come from other levels of government, and 62 percent of its programmatic expenditures are related to its agency role. At the most aggregate level, one would think that this is the optimal situation because equal proportions of the county’s budget are assigned by superordinate levels of government and then funded by those levels. The reality, however, is quite different, since portions of these state and federal monies are earmarked for specific purposes and thus cannot be moved from program to program to cover the overall costs. The fact that intergovernmental revenues are often inadequate to cover all of the specific expenditures needed for a program is evident when we analyze the budget at the program level. For example, the cost of providing the health services required by the state exceeded the intergovernmental revenues received by nearly $211 million in 1997– 19984 and estimates today remain at about $100 million. Similar calculations for the Children and Family Services and Public Social Services Departments produce funding shortfalls of $50 million and $407 million, respectively. Even though intergovernmental revenues are but one portion of the funding for these departments, it is still clear that ____________ 4This calculation compares those programmatic expenditures in the Health Services Department that we have identified as a result of the county’s agency role with the total intergovernmental revenues received by the county’s Health Services Department. 41 the county annually provides significant additional funding from its general resources to pay for these programs—programs that often exist at the behest of other levels of government—leaving less for programs that are initiated by the county. Special Case Study: Health Services The Health Services Department represents an excellent opportunity to study the county’s role as an agent of the state and federal governments and the problems that can arise as a result of these relationships—in this case, nearly resulting in the bankruptcy of the county. Since the early 1990s, Los Angeles County has struggled to keep its public health and hospital system afloat. The recession at the outset of the decade exerted tremendous pressure on the county’s budget and exposed the great weakness in the county’s portfolio of local services—its public hospital and clinic system. Depending on which set of numbers one uses, the county’s Department of Health Services spent either $2.4 billion, $3.3 billion, or $4.2 billion in 1997–1998. Much of the difficulty in ascertaining precisely how much was spent in Los Angeles County hospitals has to do with the complex matching fund procedures and requirements introduced by SB 855.5 In any case, the total expenditures are significant and are supported by private payments (insurance and fees), federal payments (Medi-Cal, Medicare, and grants), state payments (vehicle ____________ 5SB 855 is a state program that requires payments by public hospitals to the state so that the state may obtain matching funds from the federal government. The monies are then returned to the local jurisdictions from which they were obtained. The matching monies received from the federal government are allocated according to a separate formula. In the county’s accounting systems, these funds are either excluded ($2.4 billion), included once ($3.3 billion), or reported twice (once on disbursement to the state and once on expenditure by the county—$4.2 billion). 42 license fees, grants, and special fees), and county contributions. The latter totaled some $150 million to $350 million in 1997–1998 and remain at about $100 million today. They reflect monies that the county must take out of its general discretionary funds to underwrite the operation of the hospital system—a function and role that is almost entirely determined and assigned by the federal government. During the recession of the early 1990s, the Los Angeles County budget faced a triple-hit: (1) Because of the most severe recession in recent history, overall public revenues declined dramatically, (2) the state took an additional $1 billion of county revenues through the ERAF and replaced only $400 million, and (3) the implementation of new federal caps and rules on the amount of supplemental aid the federal government could provide led to a decline in Los Angeles County’s federal payments. In addition, the county used several one-time measures—including accelerating future federal payments under the SB 855 program—during the early years of the recession (1992–1993 to 1994–1995) in an attempt to “ride out” the fiscal storm. As a result, by 1995–1996, the county budget hovered dangerously close to bankruptcy, with few options left. The 1995–1996 proposed budget ignited more controversy when it proposed the closure of a majority of the county’s local health centers and clinics and the LA County-USC Medical Center.6 Although some argue that this was simply political posturing to obtain fiscal relief from outside the county, it does point to the severity of the fiscal situation created by the county’s budgetary constraints and service obligations. In ____________ 6Some alternatives were also provided, including closing all hospitals except CountyUSC and the Martin Luther King Medical Center. 43 any case, the proposal ignited a firestorm over the provision of local health services to Los Angeles County’s substantial uninsured population—a role assigned to the county by the state and federal governments but funded in a haphazard and patchwork way. Just days before the board of supervisors were to act (a plan that included closing 28 of 39 health clinics and six community hospitals— including LA County-USC), the federal government bailed out the county by providing $364 million, largely through waivers of the federal government’s Medicaid rules for reimbursement. Of course, these monies also came with strings attached. The federal government called for the county to drastically increase the number of patients seen in lower-cost outpatient clinics, to reduce the number of hospital beds in the county by one-third by the middle of 2000,7 to generate major reductions in administrative costs, and to increase its investment in preventive care for its uninsured clientele. In the ensuing years, the county greatly expanded its outpatient clinic network from 45 to 149 clinics and decreased its total beds by 28 percent. The desired savings on overall costs were much more elusive, and today the county is still far short of its goals. The federal government, however, rewarded the county’s progress by extending its relief package for three additional years through 2000, despite a decline of almost one million patients using the county’s outpatient clinics. Today, the county faces a difficult dilemma as a result of the conflicting issues and priorities of its two masters—the state and federal governments. Although the leadership of the California legislature is ____________ 7Ironically, some of the provisions waived by the federal bailout appear to create incentives to keep patients in hospital beds instead of pursuing less costly outpatient treatment. 44 exerting pressure on the board of supervisors to expand the size of the county’s new general-purpose hospital to 750 beds (as discussed above), the federal government has made it an explicit condition of the bailout monies that the county reduce the number of beds in its system. Without the federal waiver, the health department would face an annual deficit of about $300 million. With the renewal of the federal waivers looming, the supervisors face some difficult choices. Fiscal and Organizational Issues Relating to the County’s Role as a Regional Government As the complexity and contradictions inherent in the health services context show, the county’s role as a regional government is difficult to address. The two components of the county’s regional role—i.e., as an independent government and as an agent of the state and federal governments—are in some ways incompatible. As a provider of countywide services, the county must respond to its immediate constituents—the residents and voters of Los Angeles County. At the same time, the fiscal realities of modern county finance demand that the board of supervisors answer first to the state and federal governments to ensure that they receive needed local services. However, in many instances, answering to the state and federal governments first does not assure adequate funding of county activities. We review below some of the findings of our fiscal analysis, which support the perceptions expressed in our interviews with county officials and others knowledgeable about the county’s activities. 1. County government has little control over its revenues. Perhaps the greatest issue facing Los Angeles County is its lack of control over its revenue stream. General discretionary revenues are in short supply. For 45 instance, only 10 percent of overall revenues come from unrestricted property taxes. Several other studies (see Shires, 1999, and Swenson, 1999) have pointed to county governments’ lack of local discretionary revenues in California. 2. County government has little control over its expenditures. Some 62 percent of the county’s expenditures fall under its agency role; thus, much of the county supervisors’ work relates to implementing state and federal initiatives as opposed to seeking local solutions to local problems. This complicates the chain of accountability between voters and elected officials. When few resources are available to lawmakers and few options for their expansion, it is difficult or even unfair to hold supervisors accountable for a lack of effort or intervention in a discretionary area. 3. Uncertainties about state and federal mandates, notably in the area of heath care, create intergovernmental tensions over local service delivery. In the case of state and federal intergovernmental transfers, the monies typically come with strings attached and frequently further diminish local control because of embedded matching fund and maintenance of effort requirements. This is ironic in that one reason for using a local bureaucracy rather than a state or federal bureaucracy to implement programs is to allow a better match of funds to local needs and purposes. This lack of county discretion, however, is very real and significantly impedes its ability to respond to local interests and purposes. Moreover, in several instances, the county spends more on state and federally mandated programs than it receives in intergovernmental programs. A prime example is expenditures for health services, which cause tensions between local, state, and federal government over the delivery of local services. 46 4. Fiscal uncertainties make long-term financial planning difficult for county government. Another problem we have identified in our fiscal analysis is the lack of diversity in the county’s funding base. Beyond intergovernmental transfers, which contain their own level of uncertainty, Los Angeles County’s primary discretionary revenues come from property taxes and service charges. And even the property tax is not completely under the county’s control, as the state demonstrated during the recession of the 1990s. Other local governments, especially cities, have much more diversified revenue portfolios, relying much more heavily on such sources as business licenses, transient occupancy taxes, utility taxes, sales taxes, and franchise fees. The county is precluded from most of these forms of revenues except in the sparsely populated, highcost-of-service unincorporated areas. As a result, the county’s fiscal fortunes rise and fall at the behest of state and federal generosity. 5. The county government’s role as an implementing agent of the state and federal governments creates significant organizational problems. Organizationally, Los Angeles County’s role as a regional government is complex. Not only must it serve as an arbitrator between the various cities and special districts within its boundaries, but it must often serve as an arbitrator between the state and federal governments when the implementation of programs involves inconsistent decisions or goals. Such conflict of interests, illustrated in the debate over the size of the Los Angeles County-USC Medical Center, places county officials in the awkward position of resolving issues that should have been considered at the originating level of government. 6. The size and scope of Los Angeles County as a single government leads to confusion about the delivery of local services. The county government is a massive and complex bureaucracy, and this 47 contributes directly to confusion about its roles and objectives. For example, even with the full cooperation and direct assistance of county officials, it took the authors of this report months to fully understand how the many county departments and agencies provide local services to county residents. It is inconceivable, therefore, that the average citizen can fully understand many of the county’s complex policy decisions. This, in turn, leads to public confusion and misunderstanding about the county’s goals and problems. In general, the county’s role as a regional government, and especially as an agent of the state and federal governments, dominates its day-today operations. This leads to conflicting responsibilities as the county tries to serve the local constituencies and broader state and national interests, often without adequate resources. This dilemma, in turn, leaves the county’s constituents in an ongoing state of frustration and confusion about the cause of the county’s problems, the solutions to those problems, and who should be held accountable for making things right. Moreover, the distractions raised by the county’s dominant role as an agent of other governments lead to a reduced focus on regional issues. Although the county government is in an ideal position to tackle pressing regional problems, such as traffic congestion, housing mix, and economic development, the vision and leadership—not to mention the fiscal ability—to resolve such important public policy issues are currently absent. 48 4. The County as a Municipal Government Overview Los Angeles County also serves as a significant provider of municipal services, in addition to its regional role as a provider of countywide services and as an implementing agent of the state and federal governments. The municipal services role is the most complex aspect of county service provision. The institutional arrangements include both direct county spending on services to unincorporated areas and extensive use of dependent special districts to both fund and provide specific services. The county’s role is also complicated by its provision of a range of services on a contract basis to incorporated jurisdictions within its boundaries. For example, the Los Angeles County Sheriff’s Department serves as the primary police department for many cities within the county, in addition to the communities in unincorporated areas. Within the municipal services role, the county provides services in three ways: 49 (1) County departments provide municipal services directly to residents of unincorporated areas, (2) special districts directly or indirectly under county control provide services to residents of both unincorporated areas and incorporated cities, and (3) county departments provide municipal services to residents of incorporated cities through contractual arrangements. These three approaches in providing municipal services are examined in detail below. Along the way, we offer some insights into the fiscal and organizational issues explored in the interviews and discussed in Chapter 2. Los Angeles County is of course not the only provider of municipal services within its boundaries. Within the county’s 4,000 square miles are also 88 cities and over 200 special districts that also deliver public services. The sheer number and range of governments providing municipal-level services supports the contention of many of those interviewed that the size and number of local governments in the area breed confusion. To explore this issue, we examine below the broader context of local service funding and provision, supplementing our analysis of county-provided municipal services with a sample of 24 cities and five special districts (see Table 4.1).1 Services Provided by Municipal Governments Although the county under state law is the “provider of last resort” for local services, cities are the “providers of first resort” for municipal services. By “municipal services,” we imply that the responsibility for ____________ 1The sample of cities and special districts was selected in such a way as to represent a cross-section of the county in terms of geography, population, racial and ethnic diversity, and institutional structure. 50 Table 4.1 Sample of Other Local Governments 1st District Los Angelesa Bell Gardens Irwindale Monterey Park Pomona Rosemead Cities, by County Supervisorial District 2nd District 3rd District 4th District Los Angeles Los Angeles Los Angeles Compton Beverly Hills Cerritos Gardena Malibu Lakewood Hawthorne Santa Monica Long Beach Inglewood West Hollywood Manhattan Beach Signal Hill 5th District Los Angeles Bradbury Glendale Pasadena Santa Clarita Walnut Special Districtsb Dependent Special Districtsc Independent Special Districts Los Angeles County Fire District Metropolitan Water District Los Angeles County Library District Sanitation Districts of LA County Community Development Commission NOTE: Contract cities appear in boldface. aPortions of the City of Los Angeles are included in each of the five districts. bWe use the term “special districts” to refer to property tax agencies, functional assessment districts, and special districts. cSpecial districts are considered dependent or county-governed, if they are under the direct control of the County Board of Supervisors. certain services lies first with the municipalities themselves. Put simply, if the entire area within the county’s boundaries were incorporated within cities, there would be no need for the county to engage in these service activities at all. Cities in the sample spent more than $13 billion on municipal services in 1997–1998, an amount similar to that spent by the county for all of its services. The range of services provided by the 24 sample cities is presented in Table 4.2. General areas of municipal service provision include public safety (police and fire); social services (family and senior programs, job training); public health; culture and 51 Table 4.2 List of Municipal Services General Government Public Officials Mayor Council Manager/Administrative Officer Clerk Attorney/Legal Services Auditor/Controller Treasurer/Treasury Program Prosecutor/Prosecution Administrative Administration/Central Services Insurance/Liability/Risk Management Intergovernmental Relations Finance Property Ownership/ Management/Maintenance Human Resources/Personnel Information Systems Purchasing Central Stores/Warehouse Resident Services Smog Control/AQMD Programs Weed Abatement Pest Control Volunteer and Community Support Programs Public Safety Police Police/Law Enforcement Parking Fire Fire Paramedics/EMS Flood Control Leisure and Cultural Services Libraries Parks and Recreation Parks and Recreation Park/Open Space Maintenance Beach/Harbor Cultural Centers and Activities Sports Facilities Public Entertainment/Special Events Youth and Senior Programs/Centers Television/Media Public Works Administration Transportation Street Maintenance Median/Parkway Maintenance Bikeway/Pedestrian Facilities/Maintenance Lighting Engineering Building and Safety Inspection/Regulation Code Enforcement Sidewalk Maintenance Tree Maintenance Traffic Control (Signals and Signs) Environmental Compliance Social Services Human Services Senior Services Family Services Employment and Career Services Public Health Public Health Enterprise Activities Power Water Sewers/Sanitation Garbage and Recycling Transit Proprietary Departments: Airports/Harbor/Oil Debt Service/Public Financing Capital Improvements Animal Regulation/Control Housing Housing Assistance Block Grant (CDBG) Other Emergency and Disaster Preparedness Planning and Development Planning Planning and Permitting Zoning Development Community Development Economic/Business Development Redevelopment Agencies NOTE: For a list of municipal services by city, see Appendix E. CDBG is Community Development Block Grant. AQMD is Air Quality Management District. EMS is Emergency Medical Service. 52 leisure services (libraries, parks and recreation); public works (streets, engineering); planning, development, and housing; general government (public officials, administration); and a variety of enterprise activities such as water and power provision and solid waste collection. Although the responsibility for these services lies first with the municipalities, many cities use a number of alternatives to providing these services themselves. Through these alternatives—which include contracting relationships and arrangements with special districts under county direction—the county plays a significant role as provider of local services, such as police/law enforcement, fire protection, libraries, parks and recreation, planning, and public works. As noted in Chapter 3, expenditures for municipal services account for 13 percent of total county expenditures. We discuss in greater detail below the various mechanisms by which municipal services are provided, and the institutional arrangements that result between the county, cities, and special districts in delivering these services. Mechanisms for Providing Services Municipal services in Los Angeles County are provided by the county, cities, and special districts through three institutional mechanisms. The first of these is direct provision, in which the county provides municipal services to unincorporated areas through county departments, and cities provide services to their residents through municipal departments. The second mechanism is through a host of special districts, including specifically drawn assessment districts, countygoverned special districts, and special districts that operate independent of county or city control. The final mechanism for providing municipal 53 services is through contract service provision, which involves contractual relationships between the county, cities, and the private sector. Direct Provision Services are often provided directly by the jurisdiction governing a given area. The entity responsible for providing a given service, however, can vary by location. Unincorporated Areas and the County. The county is obliged to provide municipal services to those residents who do not reside within the boundaries of an incorporated city.2 Because of the extensive scale of the unincorporated areas in Los Angeles County, the county serves as a provider of municipal services to a significant number of county residents. Some 900,000 people live in unincorporated areas, and the county government must provide them with the range of services normally provided by a city government: police and fire protection; zoning and general plan administration; libraries; parks; roads; and basic utilities including water, sewer, and refuse collection. About 30 percent of the municipal services provided by the county are provided directly by county departments. The largest providers are the Sheriff’s3 and Public Works Departments, as shown in Table 4.3. Incorporated Areas. Many cities, particularly the older and larger cities in the sample, provide a full range of municipal services to their residents through city departments. Other cities provide a more limited range of services directly and use other mechanisms to provide some key ____________ 2If they did reside within the boundaries of an incorporated city, the city would bear the burden of providing these services to its residents. 3See Appendix B for a discussion of the methodology used to identify this portion of the overall Sheriff’s Department’s expenditures. 54 Table 4.3 Los Angeles County Municipal Services Provided, by Department and Institutional Arrangement, 1997–1998 Department Municipal Agricultural Commissioner/ Weights and Measures Animal Care and Control 3,520,000 Beaches and Harbors 5,570,862 Community and Senior Services 1,381,000 County Counsel District Attorney Information Systems Advisory Body Internal Services LAFCO Parks and Recreation 24,197,994 Probation Public Library 58,168,303 Public Works 209,567,949 Regional Planning 7,193,819 Registrar-Recorder/County Clerk Sheriffb 85,165,673 Treasurer and Tax Collector Enterprise Funds 58,860,710 Dependent Special Districts Contracta 380,000 5,220,000 605,000 2,162,569 99,850 175,504 3,373,732 30,381 2,080,460 287,876,423 1,722 3,281,965 138,972,098 1,642,094 29,175,307 Dependent Districts 574,829,431 Total 380,000 8,740,000 5,570,862 1,986,000 2,162,569 99,850 175,504 3,373,732 30,381 24,197,994 2,080,460 58,168,303 497,444,373 7,195,541 3,281,965 224,137,771 1,642,094 58,860,710 604,004,738 Total 453,626,310 475,077,105 574,829,431 1,503,532,846 Share of municipal revenues, % 30 32 38 100 aWe requested detailed information from each department on services that were provided on a contract basis to other local governments. Given the county’s policy of billing the client for all nonoverhead costs for such services, we assumed that contract revenues directly corresponded to the appropriate contract expenses for that activity. bIn the case of the Sheriff’s Department, there was also an issue related to the cost of providing police protection to unincorporated areas of the county. It is difficult to separate the Sheriff Department’s role as the countywide law enforcement agency from its role as the police department of both unincorporated areas and contracting cities. In this analysis, we assert that because police services to unincorporated areas are often provided from the same substations throughout the county as the contract services, the relative costs should be approximately the same. Because of the county’s contracting activity, we do have good estimates of the costs associated with providing these contracting services. Subsequently, we used the average contracted cost per resident of a contracting incorporated city to generate an estimate of the cost per person that was then applied to the unincorporated area population. This produced an estimate of the county’s cost of providing these municipal services in unincorporated areas. The balance of the department’s expenditures was then attributed to the county’s regional role. 55 services. Cities such as Los Angeles, Long Beach, Pasadena, and Santa Monica typically provide police services through their own police departments, fire protection through city fire departments, and library services through their own library departments, whereas other cities provide these services through contracts with the county or through special districts. The differences and similarities between these “fullservice” cities and contract or partial-service cities,4 and the issues raised by these arrangements, are examined below in the section on contract service provision. Special Districts The second mechanism for providing municipal services—special districts—is the most complex. These districts come in many forms, three of which are included in this study. The first is the specifically drawn assessment district, which is created for the purpose of levying a special assessment on the users of a service within a specifically defined area. These districts are typically quite small, no larger than a few city blocks in some cases, and offer specific services such as street lighting and landscaping. Some of these districts are county-governed, as explained below. A second type of special district is the county-governed special district. Throughout the history of Los Angeles County, a range of special districts have been established explicitly for the purpose of ____________ 4The term “contract city” is used in this report to denote cities that provide services through contract relationships with outside agencies or through memberships in special districts. However, most special district arrangements are not contractual. Instead, cities are members of districts that provide a specific service funded by direct property tax passthroughs from the cities to the districts themselves. Coleman (1999) refers to these cities as “partial service cities.” 56 providing a type of service to a specific area within the county. Services provided by county-governed special districts include fire protection, libraries, sewer services and maintenance, street lighting and landscaping, flood control, and storm drain maintenance. Some of these districts are large, providing services to a broad swath of the county, such as the LACFD and the County Library District; others are smaller, such as the many street lighting and landscaping districts throughout the county. Each of these special districts is governed either directly by the board of supervisors or indirectly by a department under the control of the board of supervisors. Services provided by these special districts account for 38 percent of the municipal services provided by Los Angeles County, as shown in the “share of municipal revenues” row in Table 4.3. County-governed special districts are significant providers of key services to many cities, particularly fire protection and libraries. The relationship between cities and county-governed special districts takes two forms. Cities that were members of these districts before the passage of Proposition 13 contribute revenues to the districts through direct property tax pass-throughs, receiving fire protection and library services in return. In the case of the fire district, cities that were not members of the district before Proposition 13—meaning that their property tax revenues are not sufficient to pay for fire services—can contract directly with the fire district. Table 4.4 shows the number of cities that are members of the fire and library districts and the number of cities that contract directly with the fire district. Through such county-governed special districts, the county provides fire protection and library services to over half the cities in the county. 57 Table 4.4 Los Angeles County Cities Receiving Municipal Services from the County, 1997–1998 Department Animal Care and Control Fire Protection Library Police Protection Public Works No. of Cities in County No. of Cities % Special Contracting Contracting Districts 49 56 7 8 47 0 51 41 47 88 100 % in County Special Districts 0 53 58 0 0 % Using County as Municipal Provider 56 61 58 47 100 The third type of special district is the regional district, which operates independent of county government. These districts are usually large regional organizations managing a confederation of smaller districts and providing a specific service, as is the case of the Sanitation Districts of Los Angeles County and the Metropolitan Water District, which provide sanitation and water services to a large part of the county. The property tax is an important source of income for funding the activities of many districts that were established before the passage of Proposition 13. These districts were established largely to provide property-related services to specific parcels within the county, and the cost of that service provision was allocated to those parcels through the imposition of a property tax. Proposition 13 and its subsequent implementing legislation, however, changed the way that the process worked. This proposition set the statewide total property tax rate at 1 percent and AB 8 allocated those significantly lower revenues5 as a ____________ 5Comparable property tax rates averaged about 3 percent at the time of Proposition 13’s passage. 58 function of the overall distribution of property taxes in 1976. As a result, these districts continue to receive property tax revenues, but at a level much lower than they had previously received. The constraints on the property tax—the primary revenue source for most of these districts—have created a framework that is almost completely nonresponsive to reform. Because the state legislature controls the allocation mechanism for these revenues, it is difficult for the county to entertain proposals for reorganizing these districts to better suit the county’s purposes. At the same time, these districts and their attendant services continue to be controlled by the county government or to operate independently even when the residents within their boundaries incorporate. As a result, the municipal services these residents receive, in the case of the county-governed districts, are determined by the more distant county government rather than their local city councils. In the case of independent special districts, the decisions are made by boards of directors composed of representatives from each member city and from the county board of supervisors. The result is that the special district mechanism for providing local services has become increasingly complex and contributes to widespread confusion among residents and public officials about how these services are provided and funded. Adding to the confusion is the fact that resident property tax dollars are collected and then passed through to these districts, making it difficult for residents to know whom to hold accountable. The County as a Contract Service Provider The third mechanism for providing municipal services—shown in the second column of Table 4.3—is the contractual approach wherein 59 county departments provide services under contracts with other local governments—generally cities. As Table 4.4 shows, many of the county’s incorporated jurisdictions contract with the county for important municipal services. Rather than forming their own police or fire departments, for example, many cities contract with another government—often the County of Los Angeles or one of its subordinate districts—for those services. This approach—often called the “Lakewood Plan” after one of the first cities to adopt it—has resulted in the county serving as a major provider of municipal services. The County Perspective. As shown in Table 4.4, more than half of the cities in Los Angeles County use the county government to provide animal control and library and fire services,6 and nearly half use the county to provide police services. Essentially all cities in the county contract with its Public Works Department to provide miscellaneous services. These contracts account for 32 percent of the county’s municipal service expenditures (see Table 4.3). The largest contracts are held by the Public Works, Sheriff’s, and Animal Care and Control Departments. In the case of the Sheriff’s Department and Animal Care and Control, most of these expenditures are directly and completely recaptured as fee revenues from the contracting city or district. A number of state and county statutes require that these services be provided at the county’s operating cost7 and, thus, although these ____________ 6The county’s role in providing library services is somewhat different from the other services listed. In this case, the county is one of several governments that serve on the governing body of the special district that provides library services. In all the other cases in this table, Los Angeles County is the sole governing body over the services provided. 7There is some evidence that the county may incur additional overhead-related costs associated with these services that are not recaptured from the client government. There was a consensus among county officials that these costs are not substantial, and they are not calculated in our study. 60 revenues are technically fully fungible for other purposes, they only offset the costs generated by the provision of the services. In the case of the Public Works Department, there is some contracting activity, but most of the revenues are derived from earmarked property tax revenues through special districts, as discussed above. Over the course of the interviews we conducted for this report, it became clear that the contract city model is a source of contention among cities and among some cities and the county. Because the county is restricted by law to recapturing only its operating costs in contract relationships, it is unable to charge overhead costs to those cities using its services. Larger cities—Los Angeles and Long Beach in particular— argue that their residents, who constitute the largest share of the county’s population, are subsidizing the overhead costs for contract cities through the tax dollars collected from them by the county. Cities operating under the contract city model, they argue, are unable to pay for all the costs of the services they receive, leaving the county to recoup the funds from other places in its budget. On the surface, this argument, which has been around since the onset of the contract city model in the early 1960s, appears valid. However, our analysis of the Sheriff’s Department, which contracts with 41 cities in the county, and the LACFD, which provides fire services to 54 cities in the county via special district membership or contract, found two problems with the argument. First, the LACFD receives property tax revenues from the majority of the cities to which it provides services and is able to cover its overhead costs with these revenues. The LACFD, extremely cognizant of its revenues and expenditures in the postProposition 13 era, reported that it hired a consultant to examine this very issue. The consultant concluded that the department was covering 61 its overhead costs through its relationships with both member and contract cities. Second, the Sheriff’s Department readily admitted that the overhead costs of providing services to contract cities are not covered by the rates it charges to those cities. However, the main concern of the Sheriff’s Department is not overhead costs but economies of scale. Responsible for providing services to numerous unincorporated “island” areas throughout the county, the Sheriff’s Department argues that the contract cities relationship allows it to locate stations closer to these unincorporated areas because of its need to provide services to contract cities in the same vicinity. The department argues that without these contract relationships, it would not be able to provide as quick a response because it simply could not afford to locate a station near certain unincorporated “island” areas. The broader area of coverage that comes with the contract relationship thus allows the department to take fuller advantage of economies of scale. Thus, the argument that contract cities are unable to pay the full costs of the services they receive appears either to be unfounded, as in the case of the LACFD, or to be mitigated by other factors, as in the case of the Sheriff’s Department. Although other city residents in the county may be subsidizing some of the overhead costs of the Sheriff’s Department’s contracting relationships, it is likely that most if not all of these costs would be incurred by the department if it were to try to serve unincorporated areas in the absence of contracts with cities. Thus, it is not surprising that when asked about contract relationships with cities, county officials are quite positive in their response. The City Perspective. In addition to numerous contract relationships between cities and the county and county-governed special districts, cities also contract with independent, private sector 62 organizations. Table 4.5 lists the number of cities in our study sample of 24 cities that contract out for key municipal services, and identifies Table 4.5 Contract Services, by Full-Service and Contract City, 1997–1998 Contract Service General Government Attorney/Legal Services Property Ownership/Maintenance Information Systems Public Safety Police Parking Fire and EMS Animal Care and Control Leisure and Culture Libraries Parks and Recreation Public Works Transportation Traffic Control Street Maintenance Median/Parkway Maintenance Sidewalk Maintenance Tree Maintenance Lighting Engineering Building and Safety Code Enforcement Enterprise Activities Sewer/Sanitation Garbage/Recycling Transit Full-Service Cities 2 (8%) 5 (21%) 1 (4%) — 2 (8%) 1 (4%) 7 (29%) 2 (8%) 1 (4%) 2 (8%) 3 (13%) 2 (8%) 2 (8%) 2 (8%) 4 (17%) — 1 (4%) 3 (13%) 1 (4%) 4 (17%) 4 (17%) 4 (17%) Contract Cities Contracting Agency 8 (33%) 3 (13%) 3 (13%) Independent Independent Independent 8 (33%) 5 (21%) 12 (50 %) 13 (54%) County Mixa LACFD County 10 (42%) 6 (25%) County Library District Independent 5 (21%) 6 (25%) 9 (38%) 7 (29%) 2 (8%) 7 (29%) 4 (17%) 5 (21%) 6 (25%) 6 (25%) Mix Mix Mix Mix Mix Mix Mix Mix Mix Mix 10 (42%) 8 (33%) 8 (33%) Special District Mix Mix NOTE: Based on sample of 24 cities. Table shows the number of cities that contract out, at least in part, for each service listed. Total expenditures on contract services in sample = $505,994,733. For a list of services by city and provider, see Appendix E. aMix = combination of independent contractor and/or county and/or special district. 63 whether the contractor used is the county, a special district, an independent contractor, or a mix of these. As the table shows, the county is the lead contractor in the case of police protection, animal care and control, fire protection, and libraries; independent contractors are predominant in the areas of general government and parks and recreation; and cities use a mix of these contracting agencies to provide public works, garbage and recycling services, and transit. The issue that is inevitably raised when discussing contract cities—as it was in our interviews—is whether contracting out for key services results in discrepancies between full-service and contract cities in sources of revenue and expenditures on services. We examined the differences and similarities between full-service cities and contract cities and found substantive differences between the two types of cities in terms of the revenue sources upon which they rely. However, these differences did not translate into differences in expenditure patterns. We found that contract cities and full-service cities allocate resources in similar ways. Revenue Sources. Striking differences are apparent in comparing the general fund revenues of full-service and contract cities, as shown in Table 4.6. Full-service cities rely heavily on tax revenues from property taxes, utility user taxes, and other taxes, whereas contract cities are less reliant on these taxes and rely more upon sales tax revenues, which account for 28 percent of their general fund revenues.8 Contract cities also receive a higher percentage of their revenues from money and property use (interest income), intergovernmental transfers (primarily from the county and the state, particularly from vehicle license fees), and ____________ 8The sales tax rate for cities is 1 percent, meaning that for every dollar of sales within a city’s boundaries, $.01 is returned to the city. 64 Table 4.6 City General Fund Revenue Sources, 1997–1998 General Fund Category Property taxes Sales taxes Utility users taxes Other taxesa Licenses and permitsb Fines, forfeitures, and penaltiesc Money and property used Intergovernmentale Current service chargesf Other revenues Inter-/intra-fund transfersg Full-Service Cities, % 18 12 17 20 12 3 2 7 1 1 7 Contract Cities, % 10 28 7 13 4 3 9 13 9 2 2 Total, % 17 13 16 19 11 3 3 8 2 1 7 Total 100 100 100 NOTE: For total general fund revenues by city, see Appendix D. aExamples include transient occupant taxes and business license taxes. bExamples include building permits, building plan check fees, emergency ambulance fees, and dog licenses. cExamples include vehicle code fines and parking citations. dRevenue from interest earned on investments, land and facility rental, and parking meter revenue. eRevenue from the county, the state and federal governments, and any other cities or agencies. fExamples include library fines and fees for parks and recreational services. gPrograms funded by revenues other than the general fund often receive services from general fund-supported departments. This category includes reimbursements for those services and transfers to the general fund from special funds. charges for services, which account for 31 percent of their revenues compared to 10 percent for full-service cities. Part of the difference in sources of revenue is explained by the special district relationships outlined above. Contract cities that are members of special districts— 65 such as the LACFD, the County Library District, and the Sanitation Districts of Los Angeles County—do not receive any revenues from the property assessments levied by the special districts. Thus, they must rely more upon other revenue sources, such as sales taxes and service charges. Differences in reliance upon revenue sources between contract and fullservice cities are understandable, given that many contract cities were incorporated under the premise that they would fund their services through non-property tax revenue sources—namely, sales tax revenues (Miller, 1981). Contract cities’ reliance upon sales tax revenues, however, may have some negative implications because these cities have an obvious incentive to favor sales-generating businesses, such as Wal-Mart or auto dealerships when making land use decisions. Although all cities have this incentive, amid reduced reliance on and control over other revenue sources, it is likely that this incentive is stronger among contract cities because of their greater reliance on sales tax revenues as an income stream. Given that most contract cities are smaller, suburban cities, where the competition for retail sales-generating businesses tends to be most intense, the fiscalization of land use would seem hard to avoid. In fact, a recent PPIC survey of local government officials found that the officials gave higher priority to attracting businesses that generate additional sales tax revenues than to alternative land use decisions such as attracting industry or providing housing (Lewis and Barbour, 1999). Thus, the concerns we found in our interviews about the incentives produced by sales tax revenues appear to be well-founded, particularly in the case of contract cities. Expenditure Patterns. In terms of expenditures, full-service and contract cities generally spend money in similar ways. A comparison of 66 how these cities allocate their resources and prioritize services is presented in Table 4.7. The primary differences are that full-service cities spend 20 percent of their total on social services, compared to 12 percent for contract cities, and that contract cities spend 14 percent on planning and development, compared to 8 percent for full-service cities. Similarities in the public service provision of full-service and contract cities point to a key issue raised by several of those interviewed in this study. Despite the differences in sources and control of revenues, the demands and responsibilities for providing services remain largely unchanged. From a historical perspective, local governments in Los Angeles County have faced a similar challenge. Table 4.7 Full-Service and Contract City Expenditures, 1997–1998 Department/Program General Government Public Safety Social Services Culture and Leisure Public Works Planning, Development, and Housing Full-Service Cities, % 18 28 20 7 19 8 Contract Cities, % 18 27 12 9 20 14 Total 100 100 NOTES: These categories provide a summary snapshot of six major areas of municipal service provision. The general government category includes spending for public officials, administration, and internal services. Public safety includes police and fire protection and animal care and control. Social services includes health care and senior and family services. The culture and leisure category includes parks, recreation, and libraries. The public works category includes street maintenance and engineering. Planning, development, and housing includes regional planning and permitting, housing, redevelopment, and economic development. For expenditures by city, see Appendices F and G. Enterprise, capital improvements, and debt service are not included. 67 Some Issues Related to the County’s Role as a Municipal Government Our analysis of services and revenues reveals a nexus between the county, cities, and special districts providing municipal services to the county’s residents. The county plays a significant role as a partner to cities in this process, both through its own departments and through special districts over which it exercises some control. However, this nexus also creates complications, both in terms of institutional arrangements and in the confusion that inevitably accompanies a system in which multiple levels of government provide municipal services. Our fiscal analysis verified a number of the organizational and fiscal problems mentioned in the interviews. 1. The large number of local governments providing services makes it difficult to ascertain which level of government is ultimately responsible for providing which service. The county, 88 cities, and more than 200 special districts simultaneously provide municipal services through numerous institutional arrangements, including county provision to unincorporated areas, special districts, and contracting. For example, it is conceivable that in some cities a resident with a concern about garbage collection could call three different organizations before finally reaching the organization that actually collects the garbage. This might well be the case in a city that contracts with the county for garbage collection, with the county in turn contracting out garbage collection to a private company. Although this system might be efficient from a local government perspective, it is highly complicated from a constituent perspective and understandably breeds confusion, frustration, and even irritability with government. 68 2. The institutional arrangements between the county, cities, and special districts make it difficult for the public to know whom to hold accountable. The complexity that results from multiple levels of local government providing municipal services is reinforced by the complicated flow of revenues and expenditures between local governments. Financing of municipal services in Los Angeles County is accomplished through revenue transfers between cities and the county, between the county and special districts, and between cities and special districts. From a constituent perspective, understanding which services are provided through property taxes and which through special assessments is difficult, and this creates uncertainty about how the taxpayers’ money is being spent and a sense of alienation and distrust because no identifiable accountability is affixed to the expenditures. 3. Eliminating the county’s role as municipal service provider to unincorporated areas through annexation and incorporation is subject to many impediments. One proposal suggested in the interviews for reducing the complexity of municipal service provision is to eliminate the county’s role as a municipal service provider to unincorporated areas through annexation and incorporation. Although this proposal, if feasible, would reduce the county’s role in municipal service provision to that of contractor, perhaps decreasing the complexity of the system, there are many roadblocks to the proposal. Forced annexation and incorporation is a policy no level of government is likely to embrace. Most unincorporated areas remain so because they either are rural or, in the case of urban areas, are not desirable areas of annexation to the surrounding cities. Given the limitations on property tax revenues, most cities are unlikely to annex areas of the county that have low property values or that offer little sales tax revenue. At the same time, the county 69 officials we interviewed did not think that the county’s role as a service provider to unincorporated areas should be eliminated, arguing instead that the level of services provided to those areas is equivalent to the level they would otherwise receive. 4. The “contract city” is an efficient means of providing municipal services at both the county and city levels and offers one model for local governments working closely together to provide local services. Another issue raised by those interviewed was the efficacy of the contract city model, given its prevalence in the county. Although opponents of contract cities argue that residents countywide are subsidizing the overhead costs of providing these services through the county, our analysis indicates that this either is not the case or that there are sufficient other factors, including economies of scale, that justify the service contract. At both the county and contract city level, those we interviewed resoundingly felt that the contract city model resulted in the most efficient allocation of services and was a positive relationship for both sides. 5. Reliance upon sales tax revenues, particularly in the case of contract cities, creates an incentive to prioritize commercial growth and development over housing and other regional needs. One major concern emerging from the interviews was that the sales tax provides cities with an incentive to favor retail over regional economic and housing needs when development decisions are being made by local officials. Our fiscal analysis indicates that such “fiscalization of land use” is likely, given that cities today have little control over a major local revenue stream, that is, the property tax. Contract cities, in particular, are heavily reliant upon sales tax revenues. 70 5. Conclusions: Fiscal and Organizational Alternatives Four major themes emerged from our interviews and were validated by our analysis of the revenue and expenditure data. Translated into goals, they point to what Los Angeles County must do to more effectively provide local services to its residents in the 21st century: (1) gain more fiscal control, (2) expand county partnerships, (3) show greater responsiveness, and (4) increase the county’s regional focus. Clearly, there is recognition that the county has made great strides in recent years, as a combined result of better management and a growing economy. But the consensus is that county government will need to build on these recent accomplishments if it is to effectively meet current service needs and be prepared for the two million more residents who will call Los Angeles County their home in the next 20 years. These four goals for the Los Angeles County government contain some elements that are finance-driven, others that require changes in governmental structure, and yet others that call for better relations with 71 the public. Some elements call for actions at the state level, and others require local change inside county government, between local government entities, or between local governments and the public they serve. We believe that the goals are applicable to counties throughout the state, and especially to large urban counties like Los Angeles County, because county governments in California share a common system of state and local finance. We briefly review below the alternative arrangements that were suggested for achieving these four goals by those participating in our interviews. Although we endorse the goals noted above, we do not endorse any of the specific suggestions mentioned in the interviews for arriving at these goals. Rather, the approaches for reaching these goals will ultimately depend on developing a consensus among state and local government officials, civic leaders, and residents. For this reason, it might even prove counterproductive to offer specific policy recommendations at this time. So, we simply present the goals as a framework and a reason for having a new round of discussions about the role of county government in Los Angeles County and elsewhere in California. More Fiscal Control The fact that county government has little control over its revenues and expenditures is the major finding of both our qualitative and quantitative study of Los Angeles County. The county government is highly dependent on outside sources for its funds and is limited in its abilities to generate its own revenues. Moreover, there is little flexibility on the expenditure side, because county-provided services are often 72 paid for by the state and federal governments through intergovernmental transfers that include specific requirements on how the money is to be spent. The state’s ERAF transfer in the early 1990s, which took back property tax funds that had previously been given to county governments, had the immediate effect of creating a local fiscal crisis and the longer-term effect of reminding county officials how little control they have over their budgets. With the county government so heavily dependent on state government funding, which ebbs and flows with the economy, it is very difficult for county officials to engage in strategic planning about the delivery of county-provided services. “If you talk to the elected officials in county government there doesn’t seem to be any recognition that there needs to be a plan. They are simply focused on how to make it through each year,” remarked one civic leader. Table 5.1 lists some of the ideas proposed in the interviews for increasing the county’s control over its finances and budget. Table 5.1 Suggestions for Increasing Fiscal Control Alternatives Provide a greater share of property tax to local governments Return control of property tax rate and allocation to local governments Distribute growth in sales tax revenues on a per capita or constituency-served basis Distribute greater share of sales tax revenues to counties Earmark a portion of state income tax for discretionary use by the county Use performance-based budgeting Reduce maintenance of effort provisions Switch to a two-thirds majority vote for general taxes and simple majority for specific taxes Change two-thirds majority vote to simple majority for approval of tax measures Expand partnerships with cities and private sector in health care provision Contract and partner with the private sector and nonprofits for assistance in providing public services 73 On the revenue side, alternative arrangements were proposed by both government officials and civic leaders that would increase budget control in county government. The suggestion offered most often, in various forms, is to increase the share of property tax revenues allocated to the county and other local governments. One mechanism for achieving this goal would be to cap the ERAF property tax transfers at current levels so that any growth in property taxes could be returned to the county government. In the 1999–2000 budget deliberations, the governor signed legislation that provided an additional $150 million of fiscal relief to cities and counties—half was based on population and the rest on the amount of property tax shifted away from the cities and counties during the recession. The legislation also included a provision that would place a cap on the growth of the property tax shift if a local finance reform measure was placed on the ballot in 2000.1 Another mechanism would be to return the property tax distribution to where it was before the ERAF transfers occurred in 1992–1993. This would return more than $5.6 billion dollars to Los Angeles County and $1.2 billion to cities in the county. State officials have argued that ERAF funds have in part already been returned to local governments through ____________ 1The governor signed the bill with the following statement of reluctance: “I am concerned about the provisions of this bill that would enact, contingent upon the passage of a constitutional amendment, capping the Education Revenue Augmentation Fund and requiring the state to provide specific property tax administration subventions to counties. Although I concur with the need to address the state-local fiscal relationship, AB 1661 presupposes that capping the ERAF and state assumption of certain property tax administration costs incurred by counties are appropriate solutions to reforming state and local government finance. I believe sustainable state and local government finance reform must be approached more broadly and comprehensively and not be restricted to examination of the property tax only. Furthermore, capping the ERAF value at the 1999–00 level would ignore various measures that have already mitigated the impact of the property tax shift. For some counties, the value of these mitigation measures exceeds the current value of their property tax shifts.” 74 Proposition 172, which provided local governments with funding for police and fire services starting in 1993–1994. A compromise solution would be to return the balance of ERAF transfers, less Proposition 172 funding, resulting in a return of $3.2 billion dollars to Los Angeles County and $960 million to cities in the county. Several other alternatives suggested in the interviews might indirectly increase the budget control of the county, but these suggestions are more relevant to other themes and are discussed below. These include distributing sales tax revenues on a per capita or constituency-served basis as opposed to a situs basis; increasing partnerships with cities, the private sector, and nonprofits to provide health services; and using performancebased budgeting. Distributing sales tax revenues on a per capita or constituency-served basis would increase the sales tax revenues available to the county because of its responsibility for providing a variety of services to the entire region. Increasing partnerships in the provision of health care would help reduce the county’s overburdened Health Services Department and reduce the chances of a recurrence of a fiscal crisis like that experienced earlier in the decade. Expanding these partnerships is, in fact, a requirement of the federal government under the waiver granted to the county (which provides the revenues that have offset the county’s structural deficit in health services). Finally, performance-based budgeting may help the county provide services more efficiently by tying county revenues to specific service objectives. Other suggestions for developing a more stable revenue source for county governments include returning control of the property tax to the counties, increasing the share of sales tax revenues distributed to counties, and distributing a portion of the state income tax to counties. These tax-related alternatives represent a consensus on the part of the 75 local government officials we interviewed that local governments need a stable revenue stream that comes from more than one source. As one city official noted, “The jurisdiction responsible for providing services needs to have the financial wherewithal to provide those services. It can’t just be property tax or sales tax directed. You have to look at everything together.” These alternatives would also strengthen the home rule of the county, as recommended by the California Constitution Revision Commission in 1996. Suggestions for generating new revenues through governance changes include (a) changing the two-thirds majority to a simple majority vote for passing all tax increases, and (b) switching from a simple majority to a two-thirds majority vote for general taxes and a twothirds majority to a simple majority vote for specific taxes. These voterelated recommendations hold advantages for both Los Angeles County and cities in that they would provide local governments with a greater likelihood of increasing revenues through voter-approved tax increases, while not compromising the spirit of Proposition 13—that the voters must approve such increases. Another suggestion was to expand county partnerships with cities, the private sector, and nonprofits in the provision of all social services, much like the efforts already begun. As for increasing fiscal control on the expenditure side, some want the state and federal governments to allow the county to have greater flexibility in deciding which specific programs it provides with state and federal monies. This would help address the problem of funding shortfalls for mandated services. Maintenance of effort provisions represent another area of fiscal constraint for local governments, and as 76 one county official observed, “Eliminating MOEs would free up some room for maneuvering for us.”2 Expanded Partnerships Our interviews tapped into a strong desire for the county government to “reach out” to other organizations, and our budget analysis confirmed the value of expanded partnerships. Many feel that the county government lacks the wherewithal to meet all of the service demands it faces. Indeed, the county’s limited ability to raise new revenues and direct its expenditures to specific services makes this a real concern. It will thus need the increased participation of other service providers. Moreover, some believe that Los Angeles County as a whole is lacking the cooperation that is needed between the public, private, and nonprofit sectors to deliver a wide range of regional and local services in an efficient and effective manner. Our budget analysis of services and expenditures in “contract cities” offered one tangible example of what can be achieved with increased local cooperation. The county government seems to be in an ideal position to foster and facilitate further efforts at expanding partnerships in service delivery. Table 5.2 lists some of the ideas proposed to expand the county’s partnerships with other governments and the private sector. One critical area where expanded partnerships have been proposed is health care. The county government will probably face a large deficit in health care spending whenever the federal bailout ends, which could occur in just a few years. Perhaps other local governments can be called ____________ 2Maintenance of effort provisions are provisions placed upon county government by the state and federal government, requiring the county to maintain a minimum level of service in a given area to maintain eligibility for related funding. 77 Table 5.2 Suggestions for Expanding Partnerships Alternatives Increase contract relationships with cities Expand partnerships with cities and private sector in health care provision Contract and partner with the private sector and nonprofits for assistance in providing public services Prioritize housing needs Provide a forum for interaction with cities and special districts upon in meeting the service needs, either independently or through contracts with the county. “Cities can also be involved in health care if they want. Maybe we need to look at whether it is solely the county’s responsibility,” said a state official. In addition, since the private sector contributes to the problem by not providing health insurance to working families, and private hospitals and clinics are struggling with cost containment, the business and health care communities should be involved in the dialogue about future solutions. Moreover, nonprofit organizations could be a major source for both revenues and service delivery for health care. One example of county partnerships that could be expanded is its relationship with the United Way of Greater Los Angeles, through which health services are provided to an increasing number of county residents. This partnership could be expanded to include other nonprofits, as well as private sector hospitals and clinics. This model could also be applied to other service sectors in the county. Many of those we interviewed thought that the county government could reach out more effectively to the private sector and nonprofit organizations in providing local services. Suggestions ranged from contracting out for services to public-private partnerships to grants from nonprofits to help the county government in its role of caring for the 78 poor and needy. “I don’t think they reach out enough to the private sector,” said one civic leader. Local government was also seen as another important arena for expanded partnerships. Some have proposed that the county government take a more active role in providing a forum for bringing together the service providers in county government, cities, special districts, and the private sector. “In LA there is no structure, and the cities are frustrated,” said a regional official. Some have suggested that the organizing features are already in place. “SCAG [Southern California Association of Governments] has drawn up subregions, and maybe those are the appropriate divisions,” said another civic leader. Expanded partnerships are also needed to help the county, in conjunction with other local governments, deal with unmet housing needs and economic development issues. Greater Responsiveness We often heard in our interviews that local government is remote and unresponsive to the public it serves. County government is a huge bureaucracy, as demonstrated by our budget analysis and the data we present in the appendices of this report. The sheer size and complexity of the county government could foster a belief that it is detached from the communities and people it serves. The large number of cities and special districts that provide all of the local services we identified in our budget analysis could add to the public’s frustration and confusion about who is accountable for what. “The feeling of the general populace is that the government is wasteful and inefficient, and that is why voters are reluctant to give government additional money to provide the services they demand,” said an elected county official. In Los Angeles County, it is a great challenge for local governments to be up close and personal 79 with a population of 10 million residents, especially given the highly diverse racial and ethnic mix that has resulted from immigration over the last 20 years. In addition to the duties inherent in public service, it is a political necessity to convince voters that local governments are responsive to their needs and perform worthwhile activities. Since the passage of Proposition 13, the voters have decided which government reforms to support and which to reject; and for the past 20 years, voters have opted to limit taxing and spending authority. Some of the current proposals for change, such as increasing revenue options and allowing more flexibility in spending, will require a public that believes local governments are responsive and local officials can be held accountable. Table 5.3 lists some of the suggestions offered for ways to improve the county’s responsiveness to its many constituencies. We received many suggestions for increasing the responsiveness of county government. A more transparent budget process was proposed, Table 5.3 Suggestions for Improving Responsiveness Alternatives Make budget process more transparent Use performance-based budgeting Eliminate county’s role as municipal service provider to unincorporated areas and establish a municipal services district to serve these areas Increase the number of county supervisors Elect a county mayor or CEO Monitor citizen satisfaction using public opinion surveys Expand number of locally based offices Increase interaction with media Reach out to Latino community and media Increase use of Internet services 80 so that people might have a better idea of where their money goes and could participate in budget decisions. The use of performance-based budgeting was seen as another step toward increasing the public’s perception of greater responsiveness on the part of county government, through implementing a process that would set clear and public expectations for the most efficient allocation of existing funding and a system of accountability. Monitoring citizen use of local services and their satisfaction with those services through large-scale public opinion surveys would provide a feedback mechanism for county bureaucracies and increase the public perception that the government cares about how the people rate their services. A PPIC Statewide Survey in April 1998 found some evidence that supports the importance of such communication between public officials and their constituents. Only 10 percent of Los Angeles County residents named county government as the level of government they trusted the most to solve problems that concerned them. Forty percent had little or no confidence in the ability of their county board of supervisors when it comes to handling county problems. In both survey items, Los Angeles County residents expressed more dissatisfaction than other state residents with their county officials (Baldassare, 1998b). Clearly, this issue and many others should be fully explored by fielding public opinion surveys throughout the county. Using the Sheriff’s Department as a model, the county government could also expand its locally based offices, which would help reduce the perception of the county as a remote and isolated bureaucracy. “The dilemma of LA County is that it doesn’t have the capacity to develop community-based networks to provide services,” said a regional official. “The challenge is to make government occur in a township fashion,” 81 observed an elected county official. Others have proposed that the county expand its public relations efforts to improve its image, through paid advertisements and more media coverage. “This would be a perfect time for the county [government] to work on its image and make what they do more understandable to the public,” said one civic leader. Outreach with the Latino community was cited as one particular area where media relations needs to be improved. Many of the users of county health and welfare services are Latino and many of the problems associated with the delivery of these local services stem from a lack of communication between the county and this rapidly growing constituency. Some propose that the county officials keep Latino print, radio, and broadcast media in the county more fully informed. Others suggested expanding communication through the Internet. Providing electronic information about services and service delivery (such as recordkeeping) would literally bring county services closer to residents. We believe that all of the proposed efforts would increase the responsiveness and accountability of county services and begin to break down voter distrust in government. Some have also suggested changes in governance structures to help improve the county’s responsiveness. For example, there is currently only one county supervisor per approximately two million residents in Los Angeles County. Some of those we interviewed suggested that having more supervisors would bring county government closer to its constituents by making each supervisorial district smaller. Others wanted to add the countywide offices of an elected mayor or an elected CEO. Increasing county government responsiveness is also inherently tied to increased fiscal control. As noted above, one of the most difficult tasks for the county is to meet the growing demand for services while 82 lacking control over the revenues that finance those services. Thus, returning control of the property tax to county and other local governments, providing a greater share of sales tax revenues or a share of the state income tax to the county, and reducing the two-thirds vote requirement for tax measures would provide the county with substantially more revenues that could then be devoted to meeting service demands. The disconnect between revenues and services therefore underscores many of the other challenges facing the county. As one county official noted, “We are handicapped by dysfunctional funding of local government. Financing is the foundation of local government’s problems.” A final suggestion for improving county responsiveness, as mentioned in the discussion of expanded partnerships, was that the county help establish a forum for interaction with cities and special districts that would seek to better define the roles of each sector of government and deal with regional issues, such as the need for additional housing. Increased Regional Focus Many expressed concern that county government is too involved in delivering local services that are typically reserved for city governments and special districts. They believed that the county government should assume more of a regional role, focusing on local services that need to be delivered throughout the entire county. Two reasons for increasing the county’s regional focus were given in the interviews and were confirmed by our budget analyses. The first is that the county should concentrate its limited resources on regional-level services. Clearly, we saw significant dollars and organizational efforts associated with the county’s role in providing municipal-level services. If 83 the provision of municipal-level services were left to cities and special districts, the county could devote itself to its regional role as an agency of the state and federal governments and as a regional service provider. The second reason for increasing the county’s regional focus us that there is a need for some government entity to look at “big picture” issues— housing, economic development, the natural environment, and quality of life in the region as a whole. At a minimum, this requires balancing the needs and demands for additional housing against the effect that such development may have on the region’s open spaces and wilderness areas. Growth management measures, such as those instituted in Santa Clara and Ventura Counties, and appearing on the ballot in other coastal regions, are examples of one option for the county to pursue. Of the current forms of local government, county government is in the best position to assume this leadership role. The need for a regional focus is especially important in Los Angeles County, given the population growth that is expected, the competition for jobs and industry with other regions such as New York and the Silicon Valley, and the increasing role the county plays in the global marketplace. Some of the alternatives proposed for increasing the county’s regional focus are listed in Table 5.4. A recurrent suggestion was that the county get out of the business of providing municipal-level services in the unincorporated areas. One way to accomplish this would be to encourage the annexation and incorporation of unincorporated communities. However, as many of those interviewed acknowledged, forced annexation and incorporation are difficult and unlikely prospects. A more viable alternative, as discussed above, would be to establish a municipal services district that would provide municipal services to 84 Table 5.4 Suggestions for Increasing the County’s Regional Focus Alternatives Distribute growth in sales tax revenues on a per capita or constituency-served basis Encourage unincorporated areas to incorporate or be annexed Eliminate the county’s role as municipal service provider to unincorporated areas, establishing a municipal services district to serve unincorporated areas Increase contract relationships with cities Consolidate or dissolve dependent special districts Prioritize housing needs Provide a forum for interaction with cities and special districts Expand number of locally based offices unincorporated areas. Such a district might be funded by a special assessment (or by existing property taxes) on property in these areas. One significant advantage of a municipal services district for unincorporated areas is that it would improve local government responsiveness in unincorporated areas by having one agency responsible for providing services, rather than having a county government that must balance services between these areas and the better-represented cities in the county. Currently, county supervisors charged with representing more than nine million residents countywide make municipal service decisions for the 900,000 people living in the unincorporated areas. Implementing this alternative in the unincorporated areas, however, would involve significant problems that should be carefully considered. For example, this new level of government, while certainly providing much more direct accountability and responsiveness to local needs, would also face the challenge of adequately representing and addressing the concerns and interests of an extremely diverse constituency. It would be difficult to simultaneously address the needs of the unincorporated areas in the San Pedro and Wilmington areas, those of Pepperdine University on the coast, and those of the high desert surrounding 85 Lancaster and Palmdale. One solution would be to have more than one such municipal services district, but that would exacerbate the other problem that such an approach would involve—namely, the loss of efficiencies resulting from scale and scope. Establishing such a district would also introduce new administrative costs and overhead—an effect currently mitigated by the scale of the overall Los Angeles County municipal service enterprise. To fund these activities, an argumentative political dialogue over the reallocation of the property tax would have to occur. Overall, a municipal services district for unincorporated areas would represent a tradeoff between local representation and government complexity. The obstacles to incorporation, annexation, and a municipal services district demonstrate that although there is a consensus for eliminating the county’s municipal service role in unincorporated areas, it is an objective difficult to achieve. Other suggestions for increasing the county’s regional focus included taking the “contract cities” approach to a new level by negotiating police, fire, and library service agreements with more noncontract cities in the region, which would take further advantage of regional economies of scale. Expanding the number of locally based county offices would also make the county’s role as a regional service provider more visible, particularly to smaller or outlying cities and areas in the county. “The greatest deficiency that we face in Southern California is that we have very few community-based governance structures, so we have few community-based service delivery systems,” noted one civic leader. Other suggestions for increasing the county’s regional focus call for changes in large single-purpose special districts, both independent and dependent. Some argue that regional single-purpose districts, like the Sanitation Districts of Los Angeles County and the LACFD, could be 86 consolidated into the county as general services. From a regional perspective, the advantage of this alternative is that it would allow revenue and resource allocation decisions to be made by one governmental entity, allowing the county to balance resources and to set priorities among competing demands for services. Under the current system, it is argued, certain services are overfunded, such as sanitation and fire services, but health and welfare services are underfunded. Others argue that the independent single-purpose districts are good examples of regional service-provision already occurring through the cooperation of cities and counties. Thus, the county might be better served by providing more services based upon the independent special district model. One suggestion was to change the governance structure of county dependent special districts, such as the LACFD and the County Library District so that their member cities and agencies have a vote in the policy directions pursued by these districts. This alternative could make these districts more responsive to local needs and could enhance their status as regional service providers. It was also suggested that the county disengage itself from dependent districts altogether, allowing them to operate as independent special districts. Regardless of the direction pursued with respect to dependent special districts—consolidating them into county general services or disengaging them from county control—the end result would be the same: elimination of the county’s role as overseer of dependent districts, a role that some argue creates confusion and contributes to the fragmentation of local government in Southern California. Finally, some suggested that to reinforce its regional focus, the county government should add regional housing needs and regional economic redevelopment to the list of its county programs and services. 87 These new efforts would require cooperative ventures with local governments, the private sector, and nonprofits and the creation of a forum where the various actors influencing regional service delivery could interact, as discussed in previous chapters. Regional cooperation, it was argued, has to start among the various local governments and nongovernmental agencies, for which there is currently little incentive. As one civic leader observed, “There is a lack of a strategic game plan for coordinating services between the county and other jurisdictions. There is no master plan in the county for how to accomplish it either. If there is one thing that the county needs to do institutionally, it is to come up with a master plan for dealing with interjurisdictional and regional issues.” In sum, a wide variety of alternative fiscal and organizational arrangements were suggested by those we interviewed, and our budget analyses offer compelling reasons for seriously considering these proposals. As noted by one county official, a more cooperative environment exists among local governments today than in the darker economic days of the early 1990s: “Today, cities and counties are working together to get the property tax money back from the state.” Local governments that were for many years in contentious and adversarial relations have rallied around the state and local finance issues that affect them all. The next task is to have a serious dialogue between the state and local governments about how to improve county government’s ability to finance and provide services. Today’s healthy economy offers the best opportunity to move ahead with ideas for achieving more fiscal control, expanded partnerships, greater responsiveness, and an increased regional focus. If not now, when? 88 Appendix A Departments in Los Angeles County Administrative Office, Chief Affirmative Action Agricultural Commissioner/Weights and Measures Alternate Public Defender Animal Care and Control Assessor Auditor-Controller Beaches and Harbors Board of Supervisors Chief Information Office Children and Family Services Community and Senior Services Consumer Affairs Coroner County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Military and Veterans Affairs Museum of Art Museum of Natural History Music and Performing Arts Commission Office of Ombudsman Parks and Recreation Probation Public Defender Public Library Public Social Services Public Works Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector 89 Appendix B Los Angeles County Departmental Expenditures, by Role, 1997–1998 91 Table B.1 Los Angeles County Departmental Expenditures, by Role, 1997–1998 92 Department Administrative Office, Chief Affirmative Action Agricultural Commissioner/ Weights and Measures Alternate Public Defender Animal Care and Control Arts Commission Assessor Auditor-Controller Beaches and Harbors Board of Supervisors Chief Information Office Children and Family Services Community and Senior Services Community Development Commission Consumer Affairs Coroner County Counsel Dependent Special Districts District Attorney Enterprise Funds Regional Government 24,971,028 654,090 6,800,909 18,125,012 1,337,910 1,522,104 89,886,664 29,970,314 10,384,633 34,042,069 1,526,888 37,039,405 10,493,768 114,752,300 1,430,851 13,250,162 31,144,386 272,179,365 189,859,127 Agent of State and Federal Governments Federal State Combined 695,604 421,606 633,793 7,571,697 157,026 1,063,311 2,400,940 175,144,100 948,178,703 8,699,027 77,209,126 722,801 Municipal Service Provider Dependent Municipal Contract District 3,520,000 380,000 5,220,000 5,570,862 1,381,000 605,000 58,860,710 2,162,569 29,175,307 99,850 574,829,431 Total 24,971,028 2,405,094 14,752,606 18,125,012 11,141,221 1,679,130 89,886,664 32,371,254 15,955,495 34,042,069 1,526,888 985,218,108 98,387,921 289,896,400 2,153,652 13,250,162 33,306,955 604,004,738 272,279,215 248,719,837 Table B.1 (continued) 93 Regional Department Government Fire Department—Lifeguards 6,617,000 Grand Jury 485,830 Health Services 2,899,867,133 Human Relations Commission 1,055,710 Human Resources 17,039,687 Information Systems Advisory Body 13,701,959 Internal Services 221,977,223 Local Agency Formation Commission 273,430 Mental Health Military and Veterans Affairs 666,072 Museum of Art 15,739,166 Museum of Natural History 13,667,305 Music Center Operations 7,572,983 Office of the Ombudsman 259,046 Parks and Recreation 41,160,906 Probation 25,302,753 Probation—Community- Based Contracts Public Defender 81,646,066 Public Library Public Social Services Agent of State and Federal Governments Federal State Combined Municipal Service Provider Dependent Municipal Contract District 2,334,000 84,930,000 52,309,000 457,051,282 480,739 145,562 175,504 3,373,732 30,381 278,222,286 24,197,994 1,480,602 2,414,088 405,453,814 58,168,303 2,080,460 Total 6,617,000 485,830 3,039,440,133 1,055,710 17,039,687 13,877,463 225,350,955 303,811 457,051,282 1,146,811 15,884,728 13,667,305 7,572,983 259,046 65,358,900 305,605,499 1,480,602 84,060,154 58,168,303 2,405,453,814 Table B.1 (continued) 94 Department Public Works Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Trial Court Operations— Municipal Courts Trial Court Operations— Superior Court Regional Government 40,613,355 40,488,058 919,821,190 43,570,315 Agent of State and Federal Governments Federal State Combined Municipal Service Provider Dependent Municipal Contract District 209,567,949 287,876,423 7,193,819 1,722 9,668,037 18,381,058 85,165,673 3,281,965 138,972,098 1,642,094 309,706,532 272,229,945 Total 538,057,728 7,195,541 53,438,060 1,162,340,019 45,212,409 309,706,532 272,229,945 Total 5,280,896,171 187,998,767 2,393,954,619 2,535,751,296 453,626,310 475,077,105 574,829,431 11,902,133,699 Appendix C Los Angeles County Departmental Revenues, 1997–1998 Table C.1 Los Angeles County Departmental Revenues from Taxes, Service Charges, and Fees, 1997–1998 Department Property Tax Administrative Office, Chief Affirmative Action Agricultural Commissioner/ Weights and Measures Agricultural Commissioner— Vehicle Accumulative Capital Outlay (ACO) Fund Air Quality Improvement Fund Alternate Public Defender Animal Care and Control Arts Commission Assessor Sales Tax Other Taxes 400 1,778,299 400 Service Charges and Fees 3,924,672 814,962 7,182,193 52,819 7,019 9,545,350 28,041,951 95 Table C.1 (continued) Department Asset Development Implementation Fund Auditor-Controller Beaches-Harbors Board of Supervisors Cable TV Franchise Capital Projects/Refurbishments Child Abuse/Neglect Prevention Program Children and Family Services Civic Center Employee Parking Community and Senior Services Community-Based Contracts Consumer Affairs Coroner County Counsel Courthouse Construction Criminal Justice Facility Temporary Construction Del Valle ACO Dependency Court Facilities Dependent Special Districts Detention Facilities Debt Service Fund Dispute Resolution Fund District Attorney District Attorney Asset Forfeiture District Attorney Drug Abuse/Gang Diversion Domestic Violence Program Emergency Preparedness and Response Energy Management Extraordinary Maintenance Federal and State Aid Property Tax Sales Tax Other Taxes 227,975 2,000 12,321,447 8,463,776 Service Charges and Fees 11,285,965 6,950,144 2,168,839 1,290,577 38,742 547,214 13 1,613 1,261,478 1,475,109 11,415,047 1,163 33,503,772 3,443,418 2,969,076 1,414,552 13,500 (1) 100,000 572,013 96 Table C.1 (continued) Department Property Tax Fire Department—Helicopter Replacement ACO Fire Department Developer Fee 1,467,478 Fire District 326,134,266 Fish and Game Propagation Ford Theater Development General Fund—Financing Elements 1,201,330,606 Golf Course Grand Jury Hazardous Waste Health Services—General Health Services—Enterprise Hospitals Human Relations Commission Human Resources 2,846,236 Information Systems Advisory Body (ISAB) Internal Services ISAB Marketing Judgments and Damages/Insurance Jury Operations Improvement LA Community Development Corporation 4,092,000 LAFCO Landscape Maintenance District and Landscape and Light- ing Assessment District (LLAD) 5,142,350 Linkages Support Program Marina Del Rey Debt Service Fund Marina Replacement ACO Marketing Program Mediation Services Dependency Court Mental Health Military and Veterans Affairs Sales Tax Other Taxes 77,314 800 11,000 Service Charges and Fees (2,869) 47,928,562 341,989 183,857,078 225,572,262 7,434,233 59,479,175 417,500 165,951 312,247 802,285 1,199,990 30,197,359 67,992 97 Table C.1 (continued) Department Property Tax Sales Tax Other Taxes Miscellaneous Enterprise Funds 10,909,333 Motor Vehicles ACO Municipal Court Automation Museum of Art Museum of Natural History Music Center Operations Non-Departmental Revenue Summary 2,702,418 34,825,862 67,356,869 Non-Departmental Special Accounts Oak Forest Mitigation Off-Highway Vehicles Office of Public Safety Park In-Lieu Fees—ACO Parks and Recreation 322,471 Probation Productivity Investment Public Defender Public Library 38,152,794 400 Public Social Services Public Works Public Works—Article 3 Bikeway Public Works—Aviation Capital Project Public Works—Facility Project Management Public Works—Flood Control District 163,265,073 Public Works—Flood Control/Debt Services 9,465,000 Public Works—Garbage Disposal District Summary 2,284,811 Public Works—Off Street Meter and Preferential Parking Districts Public Works—Other Special Districts Summary 55,783 54,000 Service Charges and Fees 554,894 73,482 1,202,064 2,064,462 87,615,448 51,435 8,794,174 28,316,390 14,708,502 262,630 2,276,851 4,925,508 31,913,411 5,739,615 5,125,415 8,840,295 2,310 4,060,243 98 Table C.1 (continued) Department Property Tax Sales Tax Other Taxes Public Works—Pre-County Improvement District Studies Public Works—Proposition C Local Return 9,048,149 Public Works—Road Fund 117 2,725,451 Public Works—Sewer Maintenance Districts Summary 1,573,468 Public Works—Solid Waste Management Public Works—Special Road Projects 2,805,542 Public Works—Street Light District/LLAD Summary 14,019,820 Recreation and Parks and LLAD Summary 219,296 Recreation Fund Regional Park and Open Space District Summary 76,007,654 Regional Planning Registrar-Recorder/County Clerk 400 Rent Expense San Gabriel Canyon Recreation Sheriff 29,500 Sheriff—Automated Fingerprint Identification Sheriff—Automated Fund Sheriff—Countywide Warrant System Sheriff—Inmate Welfare Sheriff—Jail Store Sheriff—Narcotic Enforcement Sheriff—Processing Fee Sheriff—Special Training 6,010 Sheriff—Vehicle Theft Prevention Fund Small Claims Advisor Program Service Charges and Fees 20,462 225,527 20,044,556 17,949,285 11,945,094 107,680 104 2,630,735 36,457,427 243,823,925 1,262,578 965,968 655,196 1,134,961 99 Table C.1 (continued) Department Property Tax Special Development Funds— Regional Parks Telephone Utilities Treasurer and Tax Collector 429 Trial Court Operations Trial Court Operations Fund Utilities Sales Tax Other Taxes 1,456,435 3,500 3,400 Service Charges and Fees 340,083 17,923,509 27,573,512 17,506,121 115,681 Total 1,872,350,364 57,562,795 71,277,173 1,293,004,47 100 Table C.2 Los Angeles County Departmental Revenues from Other Sources, 1997–1998 Inter- governmental Department Revenues Administrative Office, Chief 1,544 Affirmative Action 176,284 Agricultural Commissioner/ Weights and Measures 3,127,372 Agricultural Commissioner— Vehicle ACO Fund Air Quality Improvement Fund Alternate Public Defender Animal Care and Control Arts Commission 215,000 Assessor 14,864,740 Asset Development Implementation Fund Auditor-Controller Beaches-Harbors 587,913 Board of Supervisors 717,058 Cable TV Franchise Capital Projects/ Refurbishments 5,326,629 Child Abuse/Neglect Prevention Program Children and Family Services 897,973,795 Civic Center Employee Parking Community and Senior Services 82,850,616 Community-Based Contracts 812,000 Consumer Affairs 386 Coroner 144,395 County Counsel 33,623 Courthouse Construction Criminal Justice Facility Temporary Construction Del Valle ACO 350,000 Dependency Court Facilities Other Revenues 2,602,976 55,955 613,751 1,090,718 98,817 202,493 107,350 2,292,855 1,265,000 459,523 2,530,688 1,489,638 77,876 8,338,016 2,601,378 1,854,108 4,309,475 172,998 176,246 110,076 263,423 34,665,395 22,908,436 4,725 183,937 Debt Proceeds Department Total 6,529,592 1,047,201 12,701,615 52,819 1,090,718 105,836 9,748,243 322,350 45,199,546 1,265,000 11,745,488 10,296,720 4,377,535 1,368,453 13,664,645 2,640,120 900,375,117 4,309,488 83,025,227 812,000 1,438,110 1,729,580 11,712,093 34,665,395 22,908,436 355,888 183,937 101 Table C.2 (continuted) Inter- governmental Department Revenues Dependent Special Districts Detention Facilities Debt Service Fund 129,664 Dispute Resolution Fund District Attorney 182,012,790 District Attorney Asset Forfeiture 186,373 District Attorney Drug Abuse/Gang Diversion Domestic Violence Program Emergency Preparedness and Response 136,448 Energy Management Extraordinary Maintenance Federal and State Aid 8,812,302 Fire Department— Helicopter Replacement ACO Fire Department Developer Fee Fire District 16,553,049 Fish and Game Propagation Ford Theater Development General Fund—Financing Elements Golf Course Grand Jury Hazardous Waste Health Services—General 330,430,740 Health Services— Enterprise Hospitals 1,807,133,080 Human Relations Commission 24,000 Human Resources 255,508 Information Systems Advisory Body 263,480 Other Revenues 11,084,041 517,374 95,387 8,358,081 1,021,398 4,978 246,143 877,274 97,598 4,400,618 28,274 174,333 20,119,769 30,188 198,720 2,784,532 18,959 81,057 6,808,175 416,488 86,116 134,510 2,948,901 Debt Proceeds Department Total 56,909,260 9,110,814 3,538,805 193,339,947 1,207,771 4,978 1,660,695 149,948 877,273 197,598 13,784,933 28,274 1,638,942 410,812,960 30,188 540,709 1,201,330,606 2,784,532 18,959 81,057 521,095,993 2,033,121,830 110,116 10,670,487 3,212,381 102 Table C.2 (continuted) Inter- governmental Other Department Revenues Revenues Internal Services 130,485 2,819,317 ISAB Marketing 224,241 Judgments and Damages/ Insurance 120 Jury Operations Improvement 1,106 LA Community De- velopment Corporation 252,005,200 29,437,400 LAFCO 1,709 Landscape Maintenance District and LLAD 7,882 609,989 Linkages Support Program 429,067 Marina Del Rey Debt Service Fund 26,630,354 Marina Replacement ACO 432,308 135,076 Marketing Program 90,070 Mediation Services Dependency Court 123,794 Mental Health 355,953,400 2,541,313 Military and Veterans Affairs 217,953 164,093 Miscellaneous Enterprise Funds 5,436,695 Motor Vehicles ACO 9,550 Municipal Court Automation 1,395,426 Museum of Art 122,400 Museum of Natural History 2,535,419 Music Center Operations 3,881,802 Non-Departmental Revenue Summary 829,517,343 80,126,018 Non-Departmental Special Accounts 157,173,875 Oak Forest Mitigation 98,573 Off-Highway Vehicle 122,541 2,881 Office of Public Safety 3,580 46,062 Park In-Lieu Fees—ACO 1,400,575 Parks and Recreation 1,926,193 4,816,411 Probation 101,940,105 2,697,572 Debt Proceeds Department Total 62,429,777 224,241 120 1,106 285,952,100 167,660 5,760,221 741,314 27,432,639 567,384 90,070 1,323,784 388,692,072 461,038 16,900,922 83,032 1,395,426 1,324,464 4,599,881 3,881,802 1,102,143,958 157,225,310 98,573 125,422 8,843,816 1,400,575 35,381,465 119,346,179 103 Table C.2 (continuted) Inter- governmental Department Revenues Productivity Investment Public Defender 1,110,958 Public Library 4,399,178 Public Social Services 1,998,743,108 Public Works 759,350 Public Works—Article 3 Bikeway 218,006 Public Works—Aviation Capital Project 3,150,958 Public Works—Facility Project Management Public Works—Flood Control District 4,787,815 Public Works—Flood Control/Debt Services Summary Public Works—Garbage Disposal District Summary 39,220 Public Works—Off Street Meter and Preferential Parking Districts Public Works—Other Special Districts Summary Public Works—Pre- County Improvement District Studies Public Works—Proposition C Local Return 74,477 Public Works—Road Fund 134,826,044 Public Works—Sewer Maintenance Districts Summary 33,596 Public Works—Solid Waste Management 709,126 Public Works—Special Road Projects 50,612 Public Works—Street Light District/LLAD Summary 182,679 Other Revenues 574,278 373,085 2,654,394 5,592,492 1,440,779 610,640 222,190 20,502,821 460,000 1,065,521 126,669 784,006 3,285,946 11,103,852 984,654 909,665 118,337 2,418,888 Debt Proceeds 192,833 Department Total 574,278 1,746,673 47,483,617 2,009,261,108 34,113,540 828,646 3,150,958 5,961,805 193,681,124 9,925,000 12,229,847 128,979 4,954,032 20,462 12,634,099 168,700,020 20,733,836 13,563,885 2,974,491 16,729,067 104 Table C.2 (continuted) Inter- governmental Department Revenues Recreation and Parks and LLAD Summary 1,688 Recreation Fund Regional Park and Open Space District Summary 3,039 Regional Planning 359,074 Registar-Recorder/County Clerk 2,362,984 Rent Expense San Gabriel Canyon Recreation Sheriff 390,572,516 Sheriff—Automated Fingerprint Identification Sheriff—Automated Fund Sheriff—Countywide Warrant System Sheriff—Inmate Welfare Sheriff—Jail Store Sheriff—Narcotic Enforcement Sheriff—Processing Fee Sheriff—Special Training Sheriff—Vehicle Theft Prevention Fund 6,140,949 Small Claims Advisor Program Special Development Funds—Regional Parks Telephone Utilities Treasurer and Tax Collector 58,243 Trial Court Operations 2,634,884 Trial Court Operations Fund 71,328,964 Utilities Other Revenues Debt Proceeds 60,529 1,072,029 16,406,711 510,185,000 1,528,511 1,016,667 1,104,394 185,105 21,719,990 3,874,507 70,915 586,854 35,339,875 4,117,623 6,433,198 100,251 249,213 22,122 696,755 640,300 8,512,653 95,440,860 14,154,238 3,975,782 Department Total 281,513 1,072,133 602,602,404 4,518,320 39,837,478 1,104,394 185,105 656,145,931 3,874,507 1,333,493 586,854 35,339,875 4,117,623 6,433,198 1,066,219 661,206 6,390,162 1,157,083 696,755 980,383 27,951,269 125,652,756 102,992,723 4,091,463 Total 7,517,923,247 742,496,974 510,377,833 12,064,992,873 105 Appendix D Sample City Revenues, 1997–1998 107 Table D.1 Sample City Revenues, 1997–1998 Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/ Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Bell Gardens 435,000 1,325,000 7,975,000 140,600 125,100 2,726,840 4,062,255 173,815 381,500 Beverly Hills Bradbury 16,988,321 107,500 15,630,322 2,000 36,403,660 5,519,757 37,500 43,500 5,169,727 4,447,816 55,000 4,516,602 6,698,560 19,000 151,600 10,200 4,500 Cerritos 1,400,000 21,000,000 1,882,000 803,500 306,000 14,824,000 7,256,060 8,733,740 207,330 Total General Fund 17,345,110 95,374,765 430,800 56,412,630 Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 4,070,862 1,360,000 1,465,000 923,070 46,600 16,999,576 40,473,186 28,345,495 56,106 3,661,360 2,260,000 8,075,500 5,000 Total Other Funds 7,865,532 85,818,257 56,106 14,001,860 Grand Total 25,210,642 181,193,022 486,906 70,414,490 108 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/ Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Compton Gardena Glendale Hawthorne 3,090,036 12,128,000 6,121,985 11,000,000 2,362,025 7,258,088 20,913,000 168,800 3,023,000 2,590,000 7,420,000 3,900,000 3,733,000 556,300 205,000 1,000,000 1,406,400 73,000 5,795,000 208,658 2,800,031 1,638,672 100,300 8,972,000 2,474,000 6,299,000 2,578,450 1,682,000 4,338,401 25,039,000 Total General Fund Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 0 28,156,338 90,344,000 30,373,808 16,917,615 34,782,067 4,149,043 12,771,000 483,000 192,948,800 2,753,222 7,007,960 1,785,000 20,375,000 461,145 8,899,732 25,499,760 2,817,163 10,037,278 5,376,616 2,228,469 Total Other Funds 0 26,549,025 276,784,559 45,959,286 Grand Total 0 54,705,363 367,128,559 76,333,094 109 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Inglewood Irwindale Lakewood Long Beach 8,260,000 6,905,000 13,230,900 14,689,060 383,000 159,739 2,650,000 1,959,414 1,419,459 920,061 2,036,920 7,485,000 1,850,000 1,150,792 332,400 45,600,000 30,900,000 56,300,000 23,900,000 10,700,000 4,440,500 114,236 272,000 8,500,000 387,300 456,681 1,592,000 12,000,000 5,093,500 2,410,400 6,660,600 5,001 273,375 1,047,180 3,611,557 4,845,600 543,600 32,200,000 10,500,000 79,400,000 Total General Fund Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 62,460,260 9,005,146 23,719,869 310,085,701 110,156,160 18,112,536 14,395,000 16,013,239 8,633,831 1,360,110 5,423,400 189,292,303 189,588,623 253,944,841 605,847,587 Total Other Funds 140,564,399 18,112,536 15,417,341 1,238,673,354 Grand Total 203,024,659 27,117,682 39,137,210 1,548,759,055 110 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Los Angeles 499,204,000 309,140,000 477,625,000 567,836,000 386,735,000 89,000,000 30,447,000 197,853,000 138,566,211 Manhattan Malibu Beach 2,158,868 1,500,000 1,810,000 1,132,000 150,000 5,832,636 6,300,000 4,100,000 1,143,300 301,500 1,242,500 263,000 2,637,532 2,530,000 2,399,200 12,000 1,766,390 2,517,960 1,556,784 Monterey Park 4,001,000 3,400,000 2,600,000 4,003,000 1,266,000 710,000 1,276,200 3,617,421 426,000 Total General Fund 2,696,406,211 12,256,568 27,097,102 21,299,621 Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 1,311,113,668 62,371,922 2,536,425 3,164,300 3,421,422 12,529,990 70,620 35,000 51,590 15,504,648 3,457,000 5,900,000 2,681,348 1,239,379 874,820 Total Other Funds 1,373,485,590 2,536,425 19,272,922 29,657,195 Grand Total 4,069,891,801 14,792,993 46,370,024 50,956,816 111 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Pasadena Pomona Rosemead Santa Clarita 18,796,104 8,409,900 22,844,000 12,145,224 18,816,000 12,250,000 15,167,595 3,370,300 703,400 3,205,904 1,020,000 2,575,000 1,580,600 781,200 4,950,000 15,500,000 4,244,135 2,069,230 3,147,500 793,200 297,500 4,535,153 833,735 451,200 6,955,176 4,864,649 1,985,135 6,285,163 2,458,188 2,263,256 2,547,000 178,000 41,700 158,000 1,112,575 6,271,450 3,597,035 855,703 19,814,599 2,224,855 1,097,300 Total General Fund Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 117,629,311 54,239,725 10,569,500 38,758,128 76,517,758 37,593,282 190,715,158 24,494,081 8,207,300 24,014,161 54,029,214 8,932,903 6,698,088 35,904,903 Total Other Funds 304,826,198 119,677,659 6,698,088 35,904,903 Grand Total 422,455,509 173,917,384 17,267,588 74,663,031 112 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Santa Monica Signal Hill Walnut West Hollywood 18,788,538 22,409,000 24,855,000 24,143,879 26,257,135 270,600 7,950,000 943,900 340,000 750,000 1,050,000 635,000 257,600 4,769,000 6,630,000 9,174,680 1,659,555 7,985,000 9,747,836 228,300 8,539,226 9,007,586 94,500 12,000 6,025,923 231,000 1,056,920 2,669,356 400,450 651,800 8,700 1,550,420 84,700 426,170 2,359,347 2,344,375 246,000 369,750 Total General Fund 151,961,500 11,260,700 5,822,810 35,878,236 Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 82,255,757 16,105,828 55,984,197 2,372,998 3,082,200 4,337,890 8,877,207 2,421,900 861,100 4,999,075 Total Other Funds 154,345,782 8,738,198 4,337,890 13,876,282 Grand Total 306,307,282 19,998,898 10,160,700 49,754,518 113 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Sample Total 661,746,162 521,882,531 617,558,339 755,692,648 447,159,242 131,306,586 97,827,802 299,065,100 69,548,808 34,160,304 270,854,616 Total General Fund Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 3,906,802,138 1,984,960,323 298,730,347 819,366,711 151,769,141 66,291,216 622,041,649 Total Other Funds 3,943,159,387 Grand Total 7,849,961,525 114 Appendix E City Service Overview Matrix 115 116 Service Category General Government Public Officials Mayor Council Manager/Administrative Officer Clerk Attorney/Legal Services Auditor-Controller Treasurer/Treasury Program Prosecutor/Prosecution Administrative Administration/Central Services Insurance/Liability/Risk Management Intergovernmental Relations Finance Property Ownership/Management/Maintenance Human Resources/Personnel Information Systems Purchasing Central Stores/Warehouse Commissions Table E.1 City Service Overview Matrix Bell Beverly Gardens Hills Bradbury Cerritos Compton Gardena Glendale Hawthorne MM MM M M M M M MM M M M M M MM M M M M M MI I I MIM M M MM M I MM M M M M M MM M M MM MM M M MM MM M M M M M MM M MM M M M MM M M MM MM MM M M M M M M M M M M M MI M 117 Service Category Resident Services Smog Control/AQMD Programs Weed Abatement Nuisance Abatement Pest Control Volunteer Programs Community Support Programs Public Safety Police Police/Law Enforcement Parking Fire Fire Paramedics/EMS Animal Regulation/Control Other Emergency and Disaster Preparedness Public Assistance Human Services Senior Services Family Services Employment and Career Services Table E.1 (continued) Bell Beverly Gardens Hills Bradbury Cerritos Compton Gardena Glendale Hawthorne MI MI MI C MM MM C C MM M MI CM CM C C MM M CM C C MM M MC C C C C MM M M M M M M MM M M MM MM M M C C C M M M 118 Service Category Public Health Public Health Mental Health Programs Leisure and Cultural Services Libraries Libraries and Information Services Parks and Recreation Parks and Recreation Park/Open Space Maintenance Beach/Harbor Cultural Centers and Activities Sports Facilities Public Entertainment/Special Events Youth and Senior Programs/Centers Television/Media Public Works Public Works Administration Transportation Street Maintenance Median/Parkway Maintenance Bikeway/Pedestrian Facilities/Maintenance Lighting Engineering Table E.1 (continued) Bell Beverly Gardens Hills Bradbury Cerritos Compton Gardena Glendale Hawthorne CM CM C M C C M C MI M M M MM M MI MI I M MM M M MM M M M MM M M MM M M MM M M MM M MIC M MIC MIC M M M MIC MM M M M M M MI MC MC MI M M M MI MIC M M M M I MI M M I MM I MM M M M M M MIC 119 Service Category Building and Safety Inspection/Regulation Code Enforcement Sidewalk Maintenance Tree Maintenance Traffic Control (Signals and Signs) Environmental Compliance Other Community Development and Housing Planning Planning and Permitting Development Community Development Economic/Business Development Redevelopment Agencies Housing Housing Assistance Block Grant (CDBG) Enterprise Activities Power Water Sewers/Sanitation Garbage and Recycling Transit Table E.1 (continued) Bell Gardens I I M MI Beverly Hills M M M I M Bradbury I I M Cerritos C MC MIC I MIC Compton Gardena MM M MM MM Glendale M M M M Hawthorne MI MI M MI MC M M MI M MM M M M M M MM MM MM M M M MM MM MM M MM M M M IM M MI M I M MI IC MM M MC IC M I MM M I CC CM M 120 Service Category Oil Proprietary Departments Airport Harbor Debt Service/Public Financing Capital Improvements Table E.1 (continued) Bell Beverly Gardens Hills Bradbury Cerritos Compton Gardena Glendale Hawthorne MM M M M M M MM M M M M M M M M 121 Service Category General Government Public Officials Mayor Council Manager/Administrative Officer Clerk Attorney/Legal Services Auditor-Controller Treasurer/Treasury Program Prosecutor/Prosecution Administrative Administration/Central Services Insurance/Liability/Risk Management Intergovernmental Relations Finance Property Ownership/Management/Maintenance Human Resources/Personnel Information Systems Purchasing Central Stores/Warehouse Commissions Table E.1 (continued) Long Los Manhattan Monterey Inglewood Irwindale Lakewood Beach Angeles Malibu Beach Park M MM M M M MMM M M M M MMM M M M M MMM M MI I M M MI M MM M MM M MM I MMM MM M MMM MM M MI MMMM MM MI M MI MI MI M M M MMM M M I MMM M M MM M MM M MM MM M M MI I M M M M M MI M I M M M 122 Service Category Resident Services Smog Control/AQMD Programs Weed Abatement Nuisance Abatement Pest Control Volunteer Programs Community Support Programs Public Safety Police Police/Law Enforcement Parking Fire Fire Paramedics/EMS Animal Regulation/Control Other Emergency and Disaster Preparedness Public Assistance Human Services Senior Services Family Services Table E.1 (continued) Long Los Manhattan Monterey Inglewood Irwindale Lakewood Beach Angeles Malibu Beach Park MCM M MCM C MM M M M C MM C M MM CI M M M M C C MM C M M M C C MM C M M CC I M M C MC MI M M MC M M M M M M M M MI M MC 123 Service Category Employment and Career Services Public Health Public Health Mental Health Programs Leisure and Cultural Services Libraries Libraries and Information Services Parks and Recreation Parks and Recreation Park/Open Space Maintenance Beach/Harbor Cultural Centers and Activities Sports Facilities Public Entertainment/Special Events Youth and Senior Programs/Centers Television/Media Public Works Public Works Administration Transportation Street Maintenance Median/Parkway Maintenance Table E.1 (continued) Long Inglewood Irwindale Lakewood Beach M Los Angeles Manhattan Monterey Malibu Beach Park M M M C MM C C M M MI M M MI M MI M M M M M M M MM M MMM MI M MM M M M MMM M M MI MI MIC MIC M M MI MI M M MM M M M CI M M MI MC CI M MI M MI M IM M MI MI M M I M MI M M I 124 Service Category Bikeway/Pedestrian Facilities/Maintenance Lighting Engineering Building and Safety Inspection/Regulation Code Enforcement Sidewalk Maintenance Tree Maintenance Traffic Control (Signals and Signs) Environmental Compliance Other Community Development and Housing Planning Planning and Permitting Development Community Development Economic/Business Development Redevelopment Agencies Housing Housing Assistance Block Grant (CDBG) Enterprise Activities Power Table E.1 (continued) Long Los Manhattan Monterey Inglewood Irwindale Lakewood Beach Angeles Malibu Beach Park M MC I M MM M M MIC M M M M M M MC CI M M M MI M M MC CI M MM M MI I MI MI MI MC I I MI M M M M M M M MI M M MM M MM M MM M I MMM M I MM MM M M I M M M 125 Service Category Water Sewers/Sanitation Garbage and Recycling Transit Oil Proprietary Departments Airport Harbor Debt Service/Public Financing Capital Improvements Table E.1 (continued) Inglewood Irwindale Lakewood MI M M MI I II C C CI Long Beach M M M M Los Angeles M M M M Malibu MI I Manhattan Monterey Beach Park MI M MC MI II C CMI MM MM M M M MMM M M M MMM M M M M 126 Service Category General Government Public Officials Mayor Council Manager/Administrative Officer Clerk Attorney/Legal Services Auditor-Controller Treasurer/Treasury Program Prosecutor/Prosecution Administrative Administration/Central Services Insurance/Liability/Risk Management Intergovernmental Relations Finance Property Ownership/Management/Maintenance Human Resources/Personnel Information Systems Purchasing Central Stores/Warehouse Commissions Table E.1 (continued) Santa Santa Signal West Pasadena Pomona Rosemead Clarita Monica Hill Walnut Hollywood MM M M M MMM M M M MM M M M MMM MMM MM M M M I M M M I MM M MM M M MC M M MMM M M M M M MM MM I IM M M M M M M M MI M M M M MI M MI MM MMM M M MM M M M MI MI MM M MM M 127 Service Category Resident Services Smog Control/AQMD Programs Weed Abatement Nuisance Abatement Pest Control Volunteer Programs Community Support Programs Public Safety Police Police/Law Enforcement Parking Fire Fire Paramedics/EMS Animal Regulation/Control Other Emergency and Disaster Preparedness Public Assistance Human Services Senior Services Family Services Table E.1 (continued) Santa Santa Signal West Pasadena Pomona Rosemead Clarita Monica Hill Walnut Hollywood MI C MI M MM C C MM C MC I IC M C C CMC C M C C CMC C M I C C M MI C M M M MMM M MM M M MMM MM I C I C C C C I 128 Service Category Employment and Career Services Public Health Public Health Mental Health Programs Leisure and Cultural Services Libraries Libraries and Information Services Parks and Recreation Parks and Recreation Park/Open Space Maintenance Beach/Harbor Cultural Centers and Activities Sports Facilities Public Entertainment/Special Events Youth and Senior Programs/Centers Television/Media Public Works Public Works Administration Transportation Street Maintenance Median/Parkway Maintenance Table E.1 (continued) Santa Pasadena Pomona Rosemead Clarita M Santa Monica Signal Hill West Walnut Hollywood I M I MM C C MM C C M M MI M M MI MI M M M M M MI MI MI MC M M M MM MM MMM M MM M M M M M MI M M M MMM M M MI MI M M M MIC MIC MIC MI MIC MIC M M M MM M M M MIC M MI MC M M M MIC MC MC M C MIC M MI IM I MIC 129 Service Category Bikeway/Pedestrian Facilities/Maintenance Lighting Engineering Building and Safety Inspection/Regulation Code Enforcement Sidewalk Maintenance Tree Maintenance Traffic Control (Signals and Signs) Environmental Compliance Other Community Development and Housing Planning Planning and Permitting Development Community Development Economic/Business Development Redevelopment Agencies Housing Housing Assistance Block Grant (CDBG) Enterprise Activities Power Table E.1 (continued) Santa Pasadena Pomona Rosemead Clarita MM MM I M MMMM M M MC M MI I MI M Santa Monica MI M MI I MI M M Signal Hill M MI M M M Walnut MI I I IC M West Hollywood M IC I CM M M M M MI M M M MM M M M MI M MM M MM MM M M M MM M M M MM M MI MM Table E.1 (continued) 130 Service Category Water Sewers/Sanitation Garbage and Recycling Transit Oil Proprietary Departments Airport Harbor Debt Service/Public Financing Capital Improvements Pasadena M Pomona Rosemead M M MIC MM MC CI Santa Clarita MIC I MC MMMM MMMM NOTE: M = municipal; C = county contract; I = independent contract. Santa Monica M MI M M M M M Signal Hill M M M M M M West Walnut Hollywood I MC MC MI MIC M MM MM Appendix F City Expenditures, by Department or Program, 1997–1998 131 Table F.1 City Expenditures, by Department or Program, 1997–1998 Department/Program Bell Gardens Administrative Officer (City Manager) 1,254,113 Affirmative Action Compliance Office 0 Agricultural Commissioner/ Weights and Measures 0 Animal Care and Control 0 Auditor-Controller 455,100 Board of Supervisors (City Council/Mayor) 314,000 Children and Family Services 501,800 Community and Senior Services 677,682 Consumer Affairs 0 County Counsel 780,000 District Attorney 0 Fire 0 Health Services 257,630 Human Relations Commission 0 Human Resources 391,003 Internal Services 0 Mental Health 0 Music Center Operations 0 Parks and Recreation 2,484,685 Public Library 0 Public Social Services 0 Public Works—County Engineer 479,250 Public Works—Facility Project Management 0 Public Works—Flood Control District 0 Public Works—Public Ways/Public Facilities 2,780,860 Public Works—Reimbursement for Sewer Construction 0 Regional Planning 3,733,588 Registrar-Recorder/County Clerk 264,500 Sheriff 7,203,648 Treasurer and Tax Collector 53,000 Enterprise Activities 3,428,960 Proprietary Departments 0 Capital Improvement Projects 3,689,636 Debt Service/Public Financing 0 Beverly Hills 3,726,268 0 0 0 2,898,723 0 0 0 0 1,554,277 0 10,132,600 0 0 971,174 16,949,221 0 0 27,083,245 4,927,290 220,858 6,844,414 0 0 6,264,649 0 1,156,832 469,876 18,581,611 0 31,469,307 0 6,688,744 0 Totals 28,749,455 139,939,089 Bradbury 37,880 0 0 1,750 45,991 9,375 4,804 8,500 0 40,250 0 0 0 0 0 63,706 0 0 18,708 0 0 56,400 0 0 21,035 0 78,311 16,540 54,439 0 0 0 624,100 0 1,081,789 Cerritos 2,291,950 0 0 105,460 748,210 285,330 0 965,140 0 393,880 0 0 0 0 0 6,554,020 0 8,286,510 7,704,240 2,341,320 0 4,522,900 0 0 3,157,670 0 5,243,320 348,170 7,314,220 0 6,534,120 0 24,811,210 0 81,607,670 132 Table F.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Public Works—Reimbursement for Sewer Construction Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Compton 3,614,724 0 0 0 1,094,927 649,998 9,789,096 0 0 4,527,064 0 8,949,647 0 0 479,867 22,975,746 0 0 2,684,368 0 2,258,945 7,399,299 0 0 7,255,970 0 24,885,647 358,551 17,740,715 551,434 12,283,435 0 0 0 Totals 127,499,433 Gardena Glendale 2,725,226 2,938,596 00 0 0 777,212 0 418,200 1,955,886 145,408 1,856,975 436,199 23,143,818 2,338,869 50,000 311,803 0 5,428,301 0 0 295,175 3,358,046 38,019 0 2,242,774 0 5,005,104 1,435,268 0 1,265,092 0 19,841,965 0 0 815,354 6,028,757 0 0 6,950,468 5,187,975 12,648,443 899,057 17,634,271 00 00 10,270,930 36,823,159 199,645 394,391 0 78,676,374 399,146 11,110,356 441,440 0 0 1,178,000 0 784,600 29,616,639 1,762,472 218,003,041 0 50,981,000 7,138,485 49,465,877 524,486,062 Hawthorne 1,520,911 0 0 0 364,075 140,057 9,437,077 93,557 167,441 279,188 213,251 0 0 0 1,365,687 10,084,623 0 0 2,035,153 0 0 8,800,998 0 0 6,396,216 0 5,322,658 170,382 15,772,670 303,658 1,412,242 711,207 750,000 2,139,811 67,480,862 133 Table F.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Public Works—Reimbursement for Sewer Construction Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Inglewood 13,870,198 0 285,205 0 1,112,499 462,746 13,053,734 18,403,695 0 697,699 304,626 9,668,912 0 0 9,210,294 13,828,104 0 0 5,408,351 2,547,317 0 11,349,592 0 0 6,804,366 0 18,277,206 378,862 29,404,075 570,446 15,952,476 0 44,657,255 13,094,119 Totals 229,341,777 Irwindale Lakewood Long Beach 1,008,401 2,697,475 9,077,557 00 0 0 0 318,085 0 52,704 549,515 0 1,697,404 226,335,545 225,044 0 136,702 1,581,722 3,602,475 51,829,199 333,571 0 126,261 0 0 0 0 389,719 942,528 0 0 831,732 190,724 0 1,337,536 0 257,728 0 0 0 0 1,134,487 2,669,281 0 0 4,217,445 0 0 17,300,129 0 7,740,256 3,133,067 57,924,783 18,886,147 4,505,186 4,362,740 52,031,668 0 0 42,723,454 11,307,374 0 893,586 3,892,104 154,360,956 00 0 00 0 835,677 4,805,641 26,834,083 0 176,565 0 343,210 0 69,534,098 77,212 2,741,298 43,982 0 0 200,500 0 180,036 6,953,793 115,696 11,155,076 0 5,581,597 0 2,882,351 129,867,702 11,731,396 185,774,832 312,516,649 207,197,787 0 9,334,885 47,661,748 1,613,156,838 134 Table F.1 (continued) Department/Program Los Angeles Administrative Officer (City Manager) 9,702,000 Affirmative Action Compliance Office 0 Agricultural Commissioner/ Weights and Measures 2,226,000 Animal Care and Control 7,785,400 Auditor-Controller 13,175,800 Board of Supervisors (City Council/Mayor) 27,854,770 Children and Family Services 14,963,500 Community and Senior Services 2,684,700 Consumer Affairs 0 County Counsel 116,262,000 District Attorney 0 Fire 304,791,000 Health Services 0 Human Relations Commission 714,600 Human Resources 804,434,241 Internal Services 313,830,000 Mental Health 0 Music Center Operations 0 Parks and Recreation 173,887,295 Public Library 47,208,200 Public Social Services 0 Public Works—County Engineer 326,635,250 Public Works—Facility Project Management 0 Public Works—Flood Control District 0 Public Works—Public Ways/Public Facilities 364,962,495 Public Works—Reimbursement for Sewer Construction 0 Regional Planning 247,457,445 Registrar-Recorder/County Clerk 22,208,000 Sheriff 809,993,650 Treasurer and Tax Collector 2,107,300 Enterprise Activities 4,035,626,054 Proprietary Departments 909,957,988 Capital Improvement Projects 261,735,479 Debt Service/Public Financing 431,799,135 Totals 9,252,002,302 Malibu Manhattan Beach Monterey Park 356,840 1,508,406 1,697,320 00 0 0 28,000 241,680 0 126,690 1,855,488 0 235,470 509,006 60,410 0 279,905 0 68,502 1,585,503 188,230 59,280 548,020 0 0 0 0 0 723,872 0 0 425,590 0 0 0 0 238,918 0 3,967,020 0 0 519,612 2,754,923 0 0 5,763,944 0 0 526,628 0 260,000 0 5,320,678 0 0 2,159,629 2,073,434 0 0 2,446,465 1,313,976 0 1,971,504 6,381,350 5,152,728 00 0 169,240 0 0 786,260 3,560,284 2,684,747 0 214,560 0 1,063,574 0 2,214,127 0 3,713,430 0 0 0 1,720,538 0 251,502 9,840,199 545,084 7,609,533 0 0 0 233,637 9,809,612 146,324 4,811,788 0 2,376,046 2,677,254 11,207,454 46,266,432 48,302,874 135 Table F.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Public Works—Reimbursement for Sewer Construction Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Pasadena 7,756,706 454,560 0 0 2,756,603 1,074,231 33,492,516 9,613,929 0 2,751,179 1,259,384 19,873,509 7,650,880 0 1,442,952 16,359,384 0 0 10,987,095 7,190,893 240,000 15,742,870 0 0 11,836,702 0 5,443,493 770,070 31,728,231 1,856,363 155,128,321 0 0 0 Totals 345,409,871 Pomona 4,605,267 0 0 292,652 1,086,210 201,515 13,042,599 2,276,891 0 406,929 0 13,314,791 0 0 2,880,462 4,334,155 0 0 165,973 1,612,671 0 0 0 0 15,856,695 0 30,331,354 278,184 27,557,273 0 37,840,020 0 2,765,025 49,225,746 208,074,412 Rosemead 877,270 0 0 77,000 242,750 93,850 0 0 0 127,700 0 0 0 0 0 424,610 0 0 1,898,800 0 0 759,000 0 0 2,376,050 0 1,502,221 82,540 4,355,220 12,020 150,700 0 0 0 12,979,731 Santa Clarita 1,771,840 0 0 0 752,015 171,140 433,485 2,357,045 0 0 0 35,000 0 0 410,890 4,120,515 0 0 8,373,747 0 0 5,151,505 3,402,340 0 13,969,328 0 2,140,665 430,730 9,560,000 0 1,909,760 0 24,749,920 5,490,515 85,230,440 136 Table F.1 (continued) Department/Program Santa Monica Administrative Officer (City Manager) 9,314,313 Affirmative Action Compliance Office 0 Agricultural Commissioner/ Weights and Measures 0 Animal Care and Control 455,008 Auditor-Controller 1,889,119 Board of Supervisors (City Council/Mayor) 206,326 Children and Family Services 10,788,358 Community and Senior Services 1,760,743 Consumer Affairs 699,181 County Counsel 3,923,342 District Attorney 0 Fire 11,473,302 Health Services 0 Human Relations Commission 0 Human Resources 1,975,738 Internal Services 31,912,693 Mental Health 0 Music Center Operations 0 Parks and Recreation 11,964,303 Public Library 4,852,817 Public Social Services 0 Public Works—County Engineer 14,901,241 Public Works—Facility Project Management 0 Public Works—Flood Control District 0 Public Works—Public Ways/Public Facilities 27,538,411 Public Works—Reimbursement for Sewer Construction 0 Regional Planning 7,420,407 Registrar-Recorder/County Clerk 1,134,459 Sheriff 32,386,955 Treasurer and Tax Collector 1,165,456 Enterprise Activities 22,860,745 Proprietary Departments 1,616,424 Capital Improvement Projects 82,164,989 Debt Service/Public Financing 0 Totals 282,404,330 Signal Hill 123,050 0 0 0 967,610 147,160 4,302,150 264,137 0 0 0 0 0 0 229,613 1,257,643 0 0 490,360 219,899 0 1,059,004 0 0 1,874,260 0 1,017,158 82,848 4,354,302 11,525 2,523,467 0 0 5,999,181 24,923,367 Walnut 554,336 0 19,000 21,492 230,189 21,451 12,910 926,441 58,139 114,300 0 0 0 0 46,445 220,592 0 0 3,062,037 0 0 376,818 0 0 2,044,591 0 1,178,780 131,338 2,474,429 13,895 15,000 0 3,499,893 29,260 15,051,336 West Hollywood 410,461 0 0 0 2,441,627 702,835 1,961,560 4,240,029 881,620 475,000 0 0 0 0 485,474 3,099,138 0 0 87,430 0 0 4,413,367 0 0 3,066,171 0 5,078,347 655,282 8,908,182 457,800 2,737,384 0 45,000,000 0 85,101,707 137 Table F.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Public Works—Reimbursement for Sewer Construction Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Totals Sample Total 83,441,108 454,560 2,530,205 11,297,230 262,803,865 37,289,429 191,780,806 67,732,720 1,915,661 143,080,886 4,910,328 470,721,508 26,794,657 5,219,786 834,000,556 516,596,659 38,019 8,286,510 323,937,662 88,900,456 20,373,350 599,677,464 3,402,340 169,240 562,806,250 199,645 512,884,331 32,588,816 1,231,042,649 21,889,291 4,757,226,261 1,224,802,268 770,371,719 517,593,506 13,336,759,741 138 Appendix G City Contract Expenditures, by Department or Program, 1997–1998 139 Table G.1 City Contract Expenditures, by Department or Program, 1997–1998 Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Bell Gardens 369,013 0 0 0 150,400 189,500 194,100 188,052 0 780,000 0 0 0 0 246,300 0 0 0 1,033,785 0 0 427,350 0 0 1,656,760 946,450 54,100 423,320 2,000 830,200 0 0 0 Totals 7,491,330 Beverly Hills 2,188,784 0 0 0 611,401 0 0 0 0 1,483,477 0 139,304 0 0 206,115 8,742,834 0 0 10,912,881 108,932 298,707 1,324,579 0 0 131,898 37,233 94,351 251,705 0 18,968,278 0 0 0 45,500,479 Bradbury 0 0 0 1,750 0 0 0 0 0 40,250 0 0 0 0 0 0 0 0 0 0 0 51,400 0 0 4,500 23,300 0 54,139 0 0 0 0 0 175,339 Cerritos 126,300 0 0 105,460 36,000 100 0 35,400 0 393,380 0 0 0 0 0 200,420 0 413,000 1,196,740 77,250 0 2,766,400 0 0 186,600 619,450 0 6,698,120 0 2,654,470 0 0 0 15,118,510 140 Table G.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Compton 2,319,976 0 0 0 74,297 90,000 214,108 0 0 226,500 0 57,000 0 0 35,000 3,758,011 0 0 11,000 0 65,861 786,000 0 0 340,000 487,332 8,000 394,951 0 9,120,107 0 0 0 Gardena Hawthorne 123,360 0 00 0 0 1,700 0 0 65,000 0 170,160 219,636 3,712 235,000 0 262,533 0 0 94,413 119,554 0 0 3,000 0 145,000 113,853 10,000 356,767 29,000 0 0 0 0 0 0 22,000 4,336,592 0 0 148,325 0 0 6,031,500 00 00 429,860 36,273 1,242 710,372 600 0 0 0 0 93,900 450,864 77,500 3,691,680 12,000 72,500 18,000 250,000 5,500 Inglewood 147,000 0 4,000 0 38,000 0 108,600 10,079,533 0 0 3,500 149,000 0 0 21,750 1,338,000 0 0 152,850 186,000 0 8,095,250 0 0 38,000 1,769,875 56,850 748,533 10,000 7,724,250 0 0 0 Totals 17,988,143 2,670,268 15,671,128 30,670,991 141 Table G.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Irwindale 40,160 0 0 0 8,225 2,400 0 18,000 0 77,000 0 0 0 0 2,775 35,900 0 0 12,696 0 0 69,300 0 0 332,039 155,000 0 13,000 2,000 0 0 0 0 Lakewood 338,200 0 0 48,850 51,445 0 1,475,000 141,375 0 188,280 0 0 0 0 24,150 667,888 0 0 370,791 0 0 3,233,100 0 0 2,920,945 16,150 500 6,105,903 28,179 281,540 0 0 0 Los Angeles 739,000 0 297,000 396,000 3,315,000 1,454,100 1,677,000 62,000 0 2,000,000 0 1,628,000 0 138,000 13,117,000 91,153,100 0 0 3,178,000 0 0 10,141,000 0 0 23,020,000 4,455,000 529,000 8,000,000 132,500 97,082,000 0 0 0 Totals 768,495 15,892,296 262,513,700 Malibu 48,000 0 0 28,000 27,980 0 0 155,300 0 292,000 0 0 0 0 0 2,847 0 0 55,140 0 0 664,320 0 110,000 536,630 145,000 0 3,505,680 0 0 0 1,720,538 0 7,291,435 142 Table G.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Manhattan Beach 17,150 0 0 9,500 166,900 500 0 0 0 26,250 0 199,400 0 0 22,140 593,527 0 0 667,270 0 0 3,122,721 0 0 395,989 104,745 115,480 658,810 31,910 3,512,478 0 0 0 Monterey Park 63,235 0 0 67,282 145,640 0 256,106 60,600 0 260,000 0 118,079 0 0 83,548 333,210 0 0 551,545 62,291 0 3,131,305 0 0 897,199 360,116 84,000 291,589 2,680 176,820 0 0 20,000 Totals 9,644,770 6,965,245 Pomona Rosemead 258,635 21,600 00 0 0 55,395 0 77,000 12,500 0 1,598,178 34,729 0 0 0 12,589,953 0 0 0 211,050 0 0 0 0 0 0 0 0 0 0 121,200 0 0 0 0 0 26,100 0 0 3,000 0 0 133,300 00 00 1,863,090 92,995 2,700 138,710 0 1,416,168 0 511,775 0 944,360 275,000 0 4,205,370 0 42,000 0 0 0 18,773,378 5,861,430 143 Table G.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Totals Santa Clarita 77,070 0 0 0 191,690 0 338,300 511,235 0 0 0 35,000 0 0 0 214,775 0 0 1,698,960 0 0 453,800 3,098,325 0 206,070 100,000 0 0 0 79,000 0 0 0 7,004,225 Santa Monica 72,000 0 0 15,592 26,965 0 292,281 45,153 154,396 119,424 0 55,190 0 0 10,000 991,165 0 0 2,890,166 95,600 0 824,517 0 0 2,884,425 1,008,077 87,226 306,833 421,949 3,574,414 50,890 0 0 13,926,263 Signal Hill 5,600 0 0 0 8,000 37,450 3,000 0 0 0 0 0 0 0 5,500 25,825 0 0 50 7,400 0 26,000 0 0 174,900 94,500 500 76,350 0 28,100 0 0 0 493,175 Walnut 500 0 19,000 15,000 0 0 25 154,750 0 0 0 0 0 0 0 1,140 0 0 817,944 0 0 43,000 0 0 434,540 28,800 21,200 2,397,244 1,500 0 0 0 0 3,934,643 144 Table G.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Totals West Hollywood 33,000 0 0 0 0 3,000 160,370 115,056 90,200 475,000 0 0 0 0 23,381 1,023,094 0 0 16,322 0 0 2,435,219 0 0 282,000 1,938,913 78,343 8,908,182 44,980 2,012,430 0 0 0 17,639,490 Sample Totals 6,988,583 0 320,000 764,434 4,986,538 1,787,050 6,843,995 11,849,819 248,308 6,717,761 3,500 15,233,459 0 138,000 13,914,072 113,775,032 0 413,000 23,720,465 537,473 509,568 43,873,914 3,098,325 110,000 37,773,705 13,145,073 1,210,992 47,580,491 690,298 147,574,755 68,890 2,482,313 25,500 505,994,733 145 Bibliography Baldassare, Mark, 2000. California in the New Millennium: The Changing Social and Political Landscape, University of California Press, Berkeley, California, and Public Policy Institute of California, San Francisco, California. Baldassare, Mark, 1998a. When Government Fails: The Orange County Bankruptcy, University of California Press, Berkeley, California, and Public Policy Institute of California, San Francisco, California. Baldassare, Mark, 1998b. PPIC Statewide Survey, Public Policy Institute of California, San Francisco, California, April. California Association of Public Hospitals and Health Systems, 1999. Policy Focus: Medi-Cal Disproportionate Share of Hospital Payment Program, Berkeley, California. California Constitution Revision Commission, 1996. Executive Summary: Final Report and Recommendations to the Governor and Legislature, Sacramento, California. California Department of Finance, 1998. “New State Projections Show No Ethnic Majority in Two Years: Total Population Nearly Doubling over 50-Year Period,” Press release, California Department of Finance, Sacramento, California. 147 California Department of Finance, 1999. California County Profiles, California Department of Finance, Sacramento, California. California State Auditor, Bureau of State Audits, 1996. Los Angeles County: Budget Challenges Continue, and the Sheriff’s Department Could Achieve Savings, Sacramento, California. California State Auditor, Bureau of State Audits, 1997. Los Angeles County: Although It Continues to Balance Current Budgets, Financial Uncertainties Linger, Sacramento, California. California State Auditor, Bureau of State Audits, 1997. Los Angeles County Metropolitan Transportation Authority: Effects of the Transfer of $50 Million to Los Angeles County, Sacramento, California. Chapman, Jeffrey I., 1998. Proposition 13: Some Unintended Consequences, Public Policy Institute of California, San Francisco, California. Coleman, Michael J., 1999. “Property Tax Fairness Among Local Governments Means Consolidating Local Governance,” Cal-Tax Digest. Dardia, Michael, 1998. Subsidizing Redevelopment in California, Public Policy Institute of California, San Francisco, California. Erie, Steven P., Christopher Hoene, and Gregory Saxton, 1998. “Coping with Loss of Fiscal Autonomy: Lessons from Los Angeles County and Selected Cities, 1990–98,” John Randolph Haynes and Dora Haynes Foundation, Los Angeles, California. Frates, Steven B., and Eric S. Norby, 1996. An Analysis of Los Angeles County Government for the Howard Jarvis Taxpayers’ Educational Foundation, The Rose Institute and Claremont-McKenna College, Claremont, California. Hoene, Christopher, 1998. “Fiscal Barriers to Municipal Governance: Proposition 13 Twenty Years Later,” paper presented at the Annual Meeting of the American Political Science Association, Boston, Massachusetts. 148 Jessee, Laura, 1990. “Productivity: Part of the Governmental Culture in Los Angeles County,” Government Finance Review, December, pp. 15–18. Legislative Analyst’s Office, 1995. Los Angeles County’s Fiscal Problems, Sacramento, California. Legislative Analyst’s Office, 1998. California Counties: A Look at Program Performance, Sacramento, California. Lewis, Paul, and Elisa Barbour, 1999. California Cities and the Local Sales Tax, Public Policy Institute of California, San Francisco, California. Los Angeles County Blue Ribbon Budget Task Force Report, 1996. Los Angeles, California. Los Angeles County Citizens’ Economy and Efficiency Commission, 1992. Public Access to Decision Making, Los Angeles, California. Los Angeles County Government Public Commission Report, 1976. To Serve Seven Million, Los Angeles, California. The Metropolitan Forum Project, 1998. State of California Legislative Field Hearing Results and Briefing Materials on State-Local Finance: Quarterly Document Update for Metro Los Angeles, Los Angeles, California. Miller, Gary, 1981. Cities by Contract: The Politics of Municipal Incorporation, MIT Press, Cambridge, Massachusetts. Municipal Analysts Services, Inc., 1997. Governments of California, Austin, Texas. Shires, Michael, 1999. Patterns in California Government Revenues Since Proposition 13, Public Policy Institute of California, San Francisco, California. Shires, Michael, John Ellwood, and Mary Sprague, 1998. Has Proposition 13 Delivered? The Changing Tax Burden in California, Public Policy Institute of California, San Francisco, California. 149 Schrag, Peter, 1998. Paradise Lost: California’s Experience, America’s Future, The New Press, New York, New York. Silva, Fred, and Elisa Barbour, 1999. The State-Local Fiscal Relationship in California: A Changing Balance of Power, Public Policy Institute of California, San Francisco, California. Swenson, Jennifer, 1999. County Services: A Tale of Eight Counties, California Research Bureau, Sacramento, California. United Way of Greater Los Angeles, 1999. A Tale of Two Cities: Promise and Peril in Los Angeles, Los Angeles, California. 150 About the Authors MARK BALDASSARE Mark Baldassare is a senior fellow at PPIC, where he directs the PPIC Statewide Survey. His research interests include state and local finance, demographic change, public opinion, and urban public policy. He is the author of eight books, including California in the New Millennium: The Changing Social and Political Landscape (2000) and When Government Fails: The Orange County Bankruptcy (1998). He holds the Johnson Chair in Civic Governance at the University of California, Irvine, and is the founder and director of the Orange County Annual Survey, based at UCI. He has served as a special advisor to the Governor’s Council on Growth Management and has conducted surveys for the Los Angeles Times, the San Francisco Chronicle, and the California Business Roundtable. He holds a B.A. in sociology and psychology from the State University of New York, Stony Brook; an M.A. in sociology from the University of California, Santa Barbara; and a Ph.D. in sociology from the University of California, Berkeley. MICHAEL A. SHIRES Michael Shires is the author of several publications on U.S. trade relations, higher education, school finance, and state and local governance. He has also been active as a consultant to private companies on strategic planning, marketing research, and tax planning and preparation. Before joining PPIC, he was a doctoral fellow at the RAND 151 Graduate School of Policy Studies, concentrating on domestic education policy, California fiscal policy, and international trade policy. He holds a B.A. in economics from the University of California, Los Angeles; an M.B.A. from UCLA’s Anderson Graduate School of Management; and a Ph.D. in public policy analysis from the RAND Graduate School of Policy Studies. CHRISTOPHER HOENE Christopher Hoene is a dissertation fellow at PPIC. His dissertation examines the relationship between the fiscalization of land use and municipal revenues and expenditures. He also assists with the PPIC Statewide Survey. Prior to joining PPIC, he worked as a senior research associate at the Claremont Graduate University Research Institute, where he coordinated projects on metropolitan governance and sustainable communities and co-authored a report on the capacity of local governments to cope with reduced fiscal autonomy in the postProposition 13 era. He holds a B.A. in political science from Albertson College of Idaho and a master’s in public policy and a Ph.D. in political science from the Claremont Graduate University. AARON KOFFMAN Aaron Koffman was a research assistant at PPIC in 1998 and 1999, examining the fiscal structure of administrative subdivisions in local governments. He has researched labor and demographic statistics and has also completed fieldwork on health rights in Latin America and urban development in the San Francisco Bay area. He holds a B.A. in economics from the University of California, Berkeley. 152" } ["___content":protected]=> string(102) "

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" ["_permalink":protected]=> string(111) "https://www.ppic.org/publication/risky-business-providing-local-public-services-in-los-angeles-county/r_600mbr/" ["_next":protected]=> array(0) { } ["_prev":protected]=> array(0) { } ["_css_class":protected]=> NULL ["id"]=> int(8098) ["ID"]=> int(8098) ["post_author"]=> string(1) "1" ["post_content"]=> string(0) "" ["post_date"]=> string(19) "2017-05-20 02:34:52" ["post_excerpt"]=> string(0) "" ["post_parent"]=> int(3195) ["post_status"]=> string(7) "inherit" ["post_title"]=> string(8) "R 600MBR" ["post_type"]=> string(10) "attachment" ["slug"]=> string(8) "r_600mbr" ["__type":protected]=> NULL ["_wp_attached_file"]=> string(12) "R_600MBR.pdf" ["wpmf_size"]=> string(6) "284570" ["wpmf_filetype"]=> string(3) "pdf" ["wpmf_order"]=> string(1) "0" ["searchwp_content"]=> string(259559) "Risky Business: Providing Local Public Services in Los Angeles County ••• Mark Baldassare Michael Shires Christopher Hoene Aaron Koffman 2000 PUBLIC POLICY INSTITUTE OF CALIFORNIA Foreword When Orange County went bankrupt in December 1994, it focused public attention as never before on the fiscal and political balancing act that is a way of life for California counties. This balancing act is induced by the complexity of funding arrangements with the state and widespread public confusion about what level of government is responsible for what services. Counties are agents of state government and, since Proposition 13, have depended primarily on state resources for financial support of their programs and services. At the same time, counties are expected to respond to changing demands that often require them to provide services without the resources to do so. To help the county meet such fiscal demands, Orange County’s treasurer made the very risky investments that pushed the county into bankruptcy. At almost the same time, similar pressures brought Los Angeles County to the verge of a fiscal meltdown. PPIC research on the Orange County bankruptcy and, more generally, on the state/local fiscal relationship was beginning to identify the forces contributing to the iii unique vulnerability of county government in California. In 1998, these circumstances led PPIC to approach Los Angeles County with the objective of taking a careful look at the operations of the largest county in the state of California. The result is Risky Business: Providing Local Public Services in Los Angeles County, by Mark Baldassare, Michael A. Shires, Christopher Hoene, and Aaron Koffman. The authors provide a thorough analysis of perceived fiscal strains facing the county and its administrators, and the organizational stresses associated with a complex system of finances that makes it difficult to associate service delivery with accountability. One of the most valuable contributions of the research is the systematic linking of budget detail to the actual provision of services. Detailed tables in the appendices show exactly how complex this unit of government has become. This complexity suggests not only why the county is difficult to govern, but why it is vulnerable to a level of abuse and confusion that makes fiscal crises almost certain to occur on a regular basis. With 37 departments, 84,000 employees, 88 cities, and over 200 special districts and regional agencies, a single county government serving ten million residents faces formidable challenges. The report is not only about numbers; it also seeks to answer questions about how the county might do business more effectively. How could the county gain more fiscal control? How could it become more responsive to residents? And how could it deal with the everchallenging demands of a more regional orientation? These are just three of the key questions that are explored in detail through county staff interviews. It is striking how practical some of the answers to these questions are. What is also striking is how politically difficult it iv apparently is to pursue the specific suggestions mentioned in the interviews. Our hope is that, as they attempt to move county government out of its balancing act and onto more stable ground, all participants in county government—taxpayers, government administrators, and elected officials—will use the information in this report as a starting point for tackling this formidable task. David W. Lyon President and CEO Public Policy Institute of California v Summary County governments in California are in the risky business of having to provide essential services to an uncertain number of residents with funding sources that are largely beyond their control. All county governments participate in a system of delivering local services through complex state and local financial relationships that evolved over decades. From time to time, this fiscal system has shown signs of serious strain. During the recession in the early 1990s, county governments throughout the state had serious fiscal problems. Los Angeles County came close to a fiscal meltdown, and a large bailout in health care funding was needed from the federal government; but other large urban counties also suffered financial problems. Several rural counties also ran into serious fiscal troubles. Some observers have blamed the current state and local fiscal arrangements for the problems that county governments have faced, most recently, exemplified by the legislative action in the early 1990s allowing the state to take back property tax revenues from counties. This vii study of Los Angeles County thus has relevance for county governments throughout California. Los Angeles County was chosen for study because it is the most challenging environment in the state for local governments to provide services to their residents. The county includes almost ten million residents—nearly 30 percent of the state’s population—and is expected to be home to another two million people in the next two decades. It has been a leading immigrant destination, resulting in its current status as a “majority-minority” county in racial and ethnic composition—i.e., no racial or ethnic group represents 50 percent or more of the county’s population—and the county will soon have a majority Latino population. The responsibility for providing local services is in the hands of a massive county government, 88 city governments, and over 200 special districts and regional agencies. In recent years, the booming economy has produced extremes of both wealth and poverty. As the main provider of public social services, Los Angeles County is faced with ever-increasing demands for these services as a result of the expanding population and growing poverty. One example is that a very large uninsured population turns to county government for its health care. Local government officials in the county, as well as throughout California, have complained that citizens’ initiatives and legislative actions have severely constrained their abilities to meet these increasing local demands for services. This study of local public services in Los Angeles County was conducted through funding by the Public Policy Institute of California and with the cooperation of the Chief Administrative Office of Los Angeles County. The study had four goals: viii 1. Identify the perceived fiscal strains and organizational stresses in the provision of local public services, according to those familiar with Los Angeles County. 2. Describe the system for financing county-provided services. 3. Describe the broader context of local service provision by noncounty jurisdictions, including cities, special districts, and regional agencies. 4. Identify alternative fiscal and organizational arrangements for providing local services. We developed a methodology to meet the goals of this project within a one-year time frame. In identifying the perceived fiscal and organizational stresses, we conducted 31 in-depth interviews with elected and appointed officials from county, state, city, special district, and regional governments and community leaders from nonprofit, business, labor, media, academic, and civic organizations. For describing the county-provided services, we used the 1997–1998 county budget reports, which were the most recent county fiscal data available at the time the study began. For noncounty services, we identified the revenues, expenditures, and services provided in a sample of 24 cities in Los Angeles County and the special districts that involve most of the expenses for services in Los Angeles County. To ensure comparability with county government statistics, we derived the data for noncounty services from the 1997–1998 budgets. We identified alternative fiscal and organizational arrangements through the interviews and through supporting information from county and noncounty budget analyses. Perceived Fiscal Strains and Organizational Stresses Strong themes about the fiscal strains and organizational stresses experienced in providing local services emerged across the in-depth ix interviews with state, county, and local elected and appointed officials and Los Angeles civic leaders. These reflections by knowledgeable sources were useful for generating hypotheses for the quantitative analyses of county government and other local jurisdictions and for exploring ideas about alternative fiscal and organizational arrangements for providing local services. Perceived Fiscal Strains 1. The county government has little control over the revenues it generates and the monies it spends on services for residents. As a result of Proposition 13 and related legislation, there is a widespread perception that county government has lost control of its major revenue source, which was the local property tax. In filling the service needs of residents, county government has become increasingly dependent on state and federal monies that usually arrive with strings attached. This leaves county officials with little room for maneuvering in the types and amounts of services they provide annually—and little flexibility during recessions. 2. State, federal, and county governments are partners in delivering local services, but uncertainties about state and federal funding and mandates create tensions. In particular, the state government needs the cooperation of the county government as the “agent of the state” in delivering certain essential services at the regional level, and the county government needs the financial wherewithal from Sacramento to provide other local and countywide services to its residents. There was a feeling that the tensions surrounding the current state and local fiscal relationships—partly but not only as a result of the state government taking funding from the county government during the x recession—had done some harm to this key partnership. Some felt that relationships had improved in recent years, although largely as a result of a less stressful budget environment in Sacramento. 3. Health care is a chronic and unsolved problem facing countyprovided services. Although the 1994–1995 health care crisis was averted, no one today believes that the problem has been resolved. There are a variety of opinions on the severity of the problem, but there is general consensus that providing health care to the large, uninsured population of Los Angeles County is the most worrisome issue for county government. Most realize that the county government is heavily dependent on a continued federal bailout, and everyone knows that this funding source will not continue indefinitely. Despite recognition that the federal bailout will not continue and that another crisis is likely with the next recession, there is also a consensus that county government does not know how to solve the problem. 4. The scarcity of local revenue sources may be leading to development decisions that favor commercial growth that generates local sales tax dollars over the region’s housing and economic needs. Many of the leaders we spoke to believed that local development decisions are leaning too much toward retail and commercial building rather than residential and industrial construction, because the former generates sales tax revenues for the locality whereas the latter does not. In an era when local governments have few options for raising revenues, many are concerned that the “fiscalization of land use” results in too many local growth decisions that are not in the best interest of the region as a whole. 5. Fiscal uncertainties make long-term planning difficult, even though the county government is in better shape today than it was in xi the mid-1990s. There was near consensus that these are good fiscal times in county government, particularly compared with the dark days of the near fiscal meltdown during the recession of the early 1990s. A better economy and a more effective management structure are credited with the turnaround. Yet, there is a widely held belief that the current good times are only temporary and that county government will find itself in deep trouble again when the economy inevitably enters the next downturn. The uncertain fiscal environment makes it difficult to plan for this eventuality. Perceived Organizational Stresses 1. The size of county government and the large number of local governments operating in the county lead to public confusion about local service delivery. Local government in Los Angeles County includes the county government (84,000 employees and 37 departments), 88 cities, and over 200 special districts. Some of those interviewed considered the county government big and unwieldy. Others believed that there are too many cities and special districts. The size and complexity of these governmental units was linked to perceptions of “fragmentation” in decisionmaking about local services and a bureaucracy that is too difficult for the public to understand and access. 2. The connections between state revenues and local expenditures are so complex that is difficult to know who should be held accountable for local services. Many local and state leaders are troubled by the appearance of a “disconnect” in state and local fiscal relationships resulting from local government dependence on state funds. The current system raises public doubts about what tax monies go to what services xii and confusion about which branch of government can really be held accountable for delivering these services. 3. Contract cities (i.e., those cities that provide public services through contracts with the county government) seem to offer an efficient means of providing local services, even though these longstanding county-city relationships are still controversial. The topic of contract cities has for many years generated controversy in Los Angeles County. Some think that the county should not be in the business of selling its local services to cities. Large cities have complained that contract cities are not “real cities.” Others worry that the county government is already stretched too thin to be providing local services to contract cities and that making city incorporation easier only increases the fragmentation of the region. On the other side, some have argued that the contract city arrangement has reduced administrative overhead and service redundancies in the region. They argue that contract cities are an efficient way to achieve local governance. Most of those interviewed within county government spoke only of the benefits of contract cities—such as additional revenues and incentives to increase efficiency—whereas those in cities and special districts, as wells as civic leaders, offered mostly positive evaluations but more mixed reviews of this special county-city relationship. 4. Unincorporated areas may be an unwanted burden on county government, but many roadblocks prevent their incorporation or annexation by cities. About one million people in Los Angeles County—or approximately one in 10 residents—live in unincorporated areas. They are dependent on the county government for their municipal-level services, because they have no city government. For the urban unincorporated areas, these are services that would otherwise be xiii provided by city government, if these areas were annexed or incorporated. Again, this kind of local service activity reduces the county government’s ability to focus on its role of providing regional-level services. Given the revenue-generating limitations faced by the county government, many have suggested that urban unincorporated areas should be annexed by adjacent cities or incorporated into new cities, thus removing this service burden from county government. Most of the respondents in our study agreed with this idea in principle, although many understood why this process was not moving ahead. For the most part, residents in unincorporated areas seem to be satisfied with the services they are receiving and the cost of local government, so they are not seeking to incorporate or be annexed, and cities are in no hurry to annex land that is not generating enough revenues to cover the costs of services. 5. County government should work more closely with cities and other local governments, the private sector, and nonprofits in providing local services. There is a widespread recognition that the county government needs to improve its ability to be a partner with other local governments in providing services. Although most felt that relations between the county government and other local governments have improved in recent years, many also perceived that collaborative efforts were still too rare. Others want the county government to more actively seek partnerships outside local government, specifically, contracting with the private sector and taking advantage of the accumulation of wealth and talent in the nonprofit organizations throughout the region. Some called for public-private partnerships to meet the health services needs of the uninsured population. Many believed that if local governments are to succeed in such a challenging environment, the county government xiv must create a sense of purpose for the region as a whole—an endeavor seldom undertaken. The County as a Regional Government Los Angeles County serves as the regional government for the territories within its boundaries. In its regional role, the county has two responsibilities: (1) As an independent county government, it must respond to the needs and preferences of a countywide electorate, and (2) as an administrative agent of the California and U.S. governments, it must implement state and federal initiatives. Both responsibilities are considered part of the county’s regional role, because the services provided are delivered to the entire region within the county. To examine the county’s regional roles, we conducted an extensive, programbased analysis of the county’s finances. Our analysis identified several areas where, in its role as a regional government, the county has experienced the kinds of fiscal strains and organizational stresses identified in the interviews. 1. The county government has little control over its revenues. Only a small share of the county’s revenues are discretionary, thus limiting the government’s ability to respond to local preferences and needs. Ten percent of the county’s revenues come from unrestricted property taxes, 11 percent from service charges and fees, and 8 percent from other taxes and revenues. Since many service charges and fee revenues result from providing services (e.g., water and sewers), the use of these revenues is restricted. As a result, 21 percent of the county’s revenues are generally available to fund the regional activities that account for some 25 percent of county expenditures. This produces xv significant budget pressure and makes the county more reliant on intergovernmental transfers to provide these services. 2. The county government has little control over its expenditures. The county role as an agent of the state and federal governments dominates its regional responsibilities. Expenditures associated with the county’s “agency” role account for 62 percent of its total expenditures. Expenditures associated with its role as a provider of countywide services—such as county jails, flood control, planning, and consumer affairs—account for 25 percent of its expenditures. The remaining 13 percent of expenditures are for municipal services—such as local police, fire, animal control, and water and sewer services—which the county provides for residents of both unincorporated and incorporated areas within its jurisdiction. 3. Uncertainties about state and federal funding and mandates, notably in the area of health care, create intergovernmental tensions over local service delivery. Services the county provides as an agent of the state and federal governments often cost more than the county receives. In many instances, the county spends more on state and federally mandated programs than it receives in intergovernmental revenues. For example, the expenditures for health services the county provides in its agency role exceeded the intergovernmental revenues it received for these purposes by some $211 million in 1997–1998. Shortfalls such as this are produced by a combination of matching fund requirements (i.e., mandates that the county complement, by a certain percentage, the funds it receives from the state or federal government), maintenance of effort requirements (i.e., mandates that the county maintain a minimum level of service provision), and local county preferences. xvi 4. Fiscal uncertainties make long-term financial planning difficult for county government. The absence of a portfolio of local, discretionary streams makes county finances more vulnerable to economic shocks than other local governments. The majority of the county’s locally discretionary funds come from the property tax. Sales, business, franchise, and utility taxes are a minor portion of the county’s revenue stream. As a result, the county budget is particularly susceptible to changes in property tax revenues, through either state fiscal policies or downturns in the real estate market. Over time, cities have developed a greater ability to limit this vulnerability by expanding their reliance on alternative revenue streams. 5. The county government’s role as an implementing agent of the state and federal governments creates significant organizational problems. Aside from the accountability issues implicit in a system where the implementing body faces a different group of constituents than the policymaking body, the county’s agency role serves to create significant conflicts of interest within its boundaries. Maintenance of effort and matching fund requirements are excellent examples of how the policy choices of the state and federal governments constrain the county’s ability to customize programs to better suit local needs. Additionally, these two paternal governments can sometimes disagree and issue conflicting edicts, as has been the case with the new Los Angeles CountyUniversity of Southern California Medical Center. 6. The size and scope of Los Angeles County as a single government leads to confusion about the delivery of local services. One issue that is abundantly clear from our analysis is that the size and scope of Los Angeles County contributes directly to confusion about its role and objectives. This confusion is further complicated when the county is xvii acting as an agent of the state or federal government and is implementing their policies. Even with the direct assistance of the senior management of Los Angeles County and a well-trained staff, it took us several months to begin to understand the complexities of Los Angeles County’s many departments and agencies. It is inconceivable, therefore, that the average citizen can fully understand many of the county’s complex policy decisions, which in turn, leads to confusion and misunderstandings about the county’s goals and objectives. The County as a Municipal Government Los Angeles County’s municipal services are provided through three institutional mechanisms. The first of these is direct provision, in which the county provides municipal services to unincorporated areas through county departments, and cities provide services to their residents through municipal departments. The second mechanism is through a multitude of special districts, including specifically drawn assessment districts, county-governed special districts, and special districts that operate independent of county control. The final mechanism for providing municipal services is through contract service provision, which involves contractual relationships between the county, cities, and the private sector. Our analysis of these three mechanisms reveals a nexus between the county government, cities, and special districts providing municipal services to the county’s residents. However, this nexus also creates complications, both in terms of institutional arrangements and in the confusion that inevitably accompanies a system in which multiple levels of government are providing similar services. Our budget analysis xviii revealed several examples of the fiscal strains and organizational stresses mentioned in the interviews. 1. The large number of local governments providing services makes it difficult to ascertain which level of government is ultimately responsible for providing which service. The county, 88 cities, and more than 200 special districts simultaneously provide municipal services through numerous institutional relationships, including county provision to unincorporated areas, special districts, and contracting. The current system may be efficient from a local government perspective, but it is highly complicated and understandably breeds confusion, frustration, and even irritability with government when one tries to identify who is responsible for providing a given service. 2. The institutional arrangements between the county, cities, and special districts make it difficult for the public to know whom to hold accountable. The complexity that results from multiple levels of local government providing municipal services makes it difficult for the public to know whom to hold accountable. The complexity is reinforced by the complicated flow of revenues and expenditures between local governments. Financing of municipal services in Los Angeles County is accomplished through revenue transfers between cities and the county, between the county and special districts, and between cities and special districts. From a constituent perspective, understanding which services are provided through property taxes and which through special assessments is difficult, and this creates uncertainty about how the taxpayers’ money is being spent and a sense of alienation and distrust because no identifiable accountability is affixed to the expenditures. 3. Eliminating the county’s role as a municipal service provider to unincorporated areas through annexation and incorporation is subject xix to many impediments. One proposal suggested in the interviews for reducing the complexity of municipal service provision is to eliminate the county’s role as a municipal service provider to unincorporated areas through annexation and incorporation. However, forced annexation and incorporation is a policy no level of government is likely to embrace. Most unincorporated areas remain so because they are either rural or, in the case of urban areas, not desirable areas of annexation to the surrounding cities. Given the limitations on property tax revenues, most cities are unlikely to annex areas of the county that have low property values or that offer little sales tax revenue. At the same time, the county officials we interviewed did not they think that the county’s role as a service provider to unincorporated areas should be eliminated, arguing instead that the level of services provided to those areas is equivalent to the level they would otherwise receive. 4. The contract city is an efficient means of providing municipal services at both the county and city level, and offers one model for local governments working closely together to provide local services. Another issue raised by those interviewed was the efficacy of the contract city model, given its prevalence in the county. Although opponents of contract cities argue that residents countywide are subsidizing the overhead costs of providing these services through the county, our analysis indicates that this is not the case or that there are sufficient other factors—including economies of scale—that justify the contracting of services. At both the county and contract city level, those we interviewed resoundingly felt that the contract city model resulted in the most efficient allocation of services and was a positive relationship for both sides. xx 5. Reliance on sales tax revenues, particularly in the case of contract cities, creates an incentive to prioritize commercial growth and development over housing and other regional needs. Although we did not analyze the fiscalization of land use in great detail (see Lewis and Barbour, 1999), one issue emerging from our analysis is the incentive the sales tax provides for favoring retail business over housing and regional economic needs. Such fiscalization does seem likely, given cities’ reduced reliance on traditional revenue sources, such as the property tax. Contract cities, in particular, rely heavily on sales tax revenues to pay for the services they receive. Fiscal and Organizational Alternatives There is general consensus about what the Los Angeles County government needs to do to get ready for the growth and change that will occur in the 21st century. Four particular goals emerged from the interviews and were validated by our analysis of the revenue and expenditure data. We endorse the goals and their importance. However, we do not endorse any of the specific suggestions mentioned in the interviews (and listed below) for arriving at these goals. Rather, the approaches for reaching these goals must depend on the development of a consensus among state and local government officials, civic leaders, and residents. 1. More Fiscal Control. Suggestions emerging from the interviews for increasing fiscal control included giving a greater portion of property tax revenues to county and local governments, returning control of the property tax to local governments, distributing sales tax revenues on a per capita or constituency-served basis, earmarking a portion of the state income tax for county government, changing from a two-thirds majority xxi vote requirement to a simple majority requirement for approval of tax measures, and reducing minimum-service-level requirements placed on the county by state government. 2. Expanded Partnerships. Suggestions included increasing contract relationships with cities, expanding partnerships with cities, nonprofit organizations, and the private sector—especially for providing health services—and establishing a forum for interaction on service issues between the county, other local governments, and the private sector. 3. Greater Responsiveness. Suggestions included increasing the number of county supervisors, electing a county mayor or chief executive officer, making the budget process more understandable to the public, and utilizing performance-based budgeting. Other suggestions included improving public relations, particularly with the Latino media, increasing the use of the Internet for information and services, and monitoring citizen satisfaction through public opinion surveys. 4. Increased Regional Focus. Emphasizing the county’s role as a regional service provider was mentioned by many of those interviewed. Suggestions included eliminating the county’s role as a municipal service provider to unincorporated areas by encouraging annexation or incorporation of these areas, creating a municipal services district for funding and delivering services specifically for these areas, and distributing sales tax revenues on a per capita basis to make these areas more capable of financing their own service provision. Other suggestions included increasing contract relationships with cities, expanding the number of locally based county offices to increase the county’s presence in the region, prioritizing housing needs, providing a forum for interjurisdictional cooperation, and eliminating the county’s involvement xxii with dependent districts, either through consolidation of these districts or relinquishing county control over them. Clearly, there is recognition that county government has made great strides in recent years as a result of better management and a growing economy. But the consensus is that county government will need to build on these recent accomplishments if it is to effectively meet current service needs and to prepare for the two million more residents who will call Los Angeles County their home in the next 20 years. This preparation will require public policy discussions and consensus building among county residents and their elected officials. The four goals presented above—emerging from our interviews and fiscal analysis— offer a framework and reason for having these discussions. xxiii Contents Foreword..................................... iii Summary..................................... vii Tables ....................................... xxvii Acknowledgments ............................... xxix 1. INTRODUCTION ........................... Goals of This Study ........................... Methods .................................. Perceived Fiscal Strains and Organizational Stresses...... Analyses of the County’s Role as a Regional and Municipal Government............................. Fiscal and Organizational Alternatives .............. The Los Angeles Context ........................ Organization of This Report ...................... 2. PERCEIVED FISCAL STRAINS AND ORGANIZATIONAL STRESSES ................. Perceived Fiscal Strains ......................... Perceived Organizational Stresses ................... 3. THE COUNTY AS A REGIONAL GOVERNMENT .... The County as an Independent Government ........... Challenges the County Faces as an Independent Government............................. 1 6 7 7 8 9 10 14 15 17 22 29 31 33 xxv The County as an Administrative Agent of the State and Federal Governments ....................... Challenges the County Faces as an Agent of the State and Federal Governments ....................... Special Case Study: Health Services ............... Fiscal and Organizational Issues Relating to the County’s Role as a Regional Government ................ 36 38 42 45 4. THE COUNTY AS A MUNICIPAL GOVERNMENT ... Overview .................................. Services Provided by Municipal Governments ........... Mechanisms for Providing Services .................. Direct Provision ............................ Special Districts ............................ The County as a Contract Service Provider ........... Some Issues Related to the County’s Role as a Municipal Government............................. 49 49 50 53 54 56 59 68 5. CONCLUSIONS: FISCAL AND ORGANIZATIONAL ALTERNATIVES ............................ More Fiscal Control ........................... Expanded Partnerships ......................... Greater Responsiveness ......................... Increased Regional Focus ........................ 71 72 77 79 83 Appendix A. Departments in Los Angeles County ................ 89 B. Los Angeles County Departmental Expenditures, by Role, 1997–1998................................. 91 C. Los Angeles County Departmental Revenues, 1997–1998 ... 95 D. Sample City Revenues, 1997–1998 ................. 107 E. City Service Overview Matrix ..................... 115 F. City Expenditures, by Department or Program, 1997– 1998 ..................................... 131 G. City Contract Expenditures, by Department or Program, 1997–1998................................. 139 Bibliography .................................. 147 About the Authors ............................... 151 xxvi Tables 1.1. Los Angeles County Characteristics .............. 2.1. Individuals Interviewed ...................... 3.1. Los Angeles County Expenditures, by Role and Institutional Structure, 1997–1998............... 3.2. Responsibilities of the County as an Independent Government ............................. 3.3. Los Angeles County Revenues, 1997–1998.......... 3.4. Agency Roles of Los Angeles County ............. 4.1. Sample of Other Local Governments.............. 4.2. List of Municipal Services ..................... 4.3. Los Angeles County Municipal Services Provided, by Department and Institutional Arrangement, 1997– 1998 .................................. 4.4. Los Angeles County Cities Receiving Municipal Services from the County, 1997–1998 .................. 4.5. Contract Services, by Full-Service and Contract City, 1997–1998 .............................. 4.6. City General Fund Revenue Sources, 1997–1998 ...... 11 16 31 32 34 38 51 52 55 58 63 65 xxvii 4.7. Full-Service and Contract City Expenditures, 1997– 1998 .................................. 67 5.1. Suggestions for Increasing Fiscal Control ........... 73 5.2. Suggestions for Expanding Partnerships ............ 78 5.3. Suggestions for Improving Responsiveness .......... 80 5.4. Suggestions for Increasing the County’s Regional Focus .................................. 85 B.1. Los Angeles County Departmental Expenditures, by Role, 1997–1998 .......................... 92 C.1. Los Angeles County Departmental Revenues from Taxes, Service Charges, and Fees, 1997–1998............. 95 C.2. Los Angeles County Departmental Revenues from Other Sources, 1997–1998 ........................ 101 D.1. Sample City Revenues, 1997–1998............... 108 E.1. City Service Overview Matrix .................. 116 F.1. City Expenditures, by Department or Program, 1997– 1998 .................................. 132 G.1. City Contract Expenditures, by Department or Program, 1997–1998 .............................. 140 xxviii Acknowledgments This idea for this study began with a conversation two years ago between David Lyon, President and CEO of the Public Policy Institute of California, and Gil Garcetti, District Attorney of Los Angeles County, after a briefing by Mark Baldassare on the Orange County bankruptcy. Over the course of the next year, a proposal for research took form through meetings between PPIC staff and elected and appointed officials in county government. These discussions culminated in a “Memorandum of Understanding” in September 1998 between David Lyon and David Janssen, Chief Administrative Officer in Los Angeles, to conduct a study of the role of county government in providing local services. Michael Shires and Mark Baldassare were the co-principal investigators on this project. They recruited Chris Hoene from Claremont Graduate University to manage the research project in Los Angeles and hired Aaron Koffman to provide research assistance in San Francisco. We wish to thank Michael Teitz, Fred Silva, and Paul Lewis at PPIC for their advice at various stages of the study. We received xxix invaluable help from David Abel of the Metropolitan Forum and Los Angeles County Citizens’ Economy and Efficiency Commission. We are especially grateful to David Janssen and his staff for their assistance at every stage of this project. We consulted with staff members Sandra Davis, Laura Jessee, and Martin Zimmerman and were assisted by Gwen Andrizzi on a regular basis. We also wish to thank Michael Teitz, David Janssen, Steven Erie, Fred Silva, and Dean Misczynski for their comments on an earlier draft of this report. The authors made the final decisions on the study’s scope and content, and all of the opinions expressed in this report reflect those of the authors alone. xxx 1. Introduction Local governments in California today face serious constraints whenever they want to increase local funding for the services they provide to residents. These constraints began when the voters passed Proposition 13 in 1978, which limited increases in local property taxes, lowered the existing tax base to 1 percent, and required local governments to seek a two-thirds majority from their voters whenever they wanted to raise local taxes. A series of legislative acts, in response to Proposition 13 and its political aftermath, has placed the state government in the dominant role of allocating revenues to the cities, counties, school districts, and other governmental entities that are responsible for providing local services to residents. The state’s fiscal power over local services is even stronger when we consider that the supermajority vote needed to raise local taxes is often difficult to achieve because many voters do not trust their governments. The effects of the state’s strong role in allocating revenue for local services have for many years been an issue of controversy. Some 1 observers claim that the separation of fiscal responsibility from service accountability breeds public confusion and, ultimately, voter cynicism about the role of government in their daily lives. Others say that the current level of state involvement in service provision is inefficient, because local governments have too little control over the decisions affecting their residents. Still other experts are not concerned about the separation of revenue collection and spending. They argue that Proposition 13 and its progeny have given the California voters what they want—government that delivers local services at the lowest cost possible without the threat of unwanted tax increases by their local governments. To date, there is little evidence to support any of these strongly held positions. In recent years, the fiscal calamities that have befallen California’s local governments have led to a closer examination of, and calls for change in, the state and local fiscal relationships at the foundation of local service provision (Baldassare, 1998a; Hoene, 1998; Shires, 1999). The latest round of reform discussions began soon after the state took back billions of dollars that it previously had allocated to local governments, so that it could reduce the ballooning state budget deficit during the recession in the early 1990s. Fiscal calamities followed the local funding reductions, including the Orange County bankruptcy, a near meltdown in Los Angeles County, and financial problems in several rural counties in Northern California. Some have argued that these problems were caused by local actions rather than by the state, although others claim that local governments no longer have the tools they need to adjust to a loss of state funds. As the California economy improved in the late 1990s, and as large budget surpluses led to more generous revenue allocations to local 2 governments from the state, the mention of fiscal problems by local governments diminished. Yet calls for state and local fiscal reform continue, including requests that the state government return property tax revenues to local governments. Local governments are quick to point out that their next fiscal crisis is just a recession away, unless the state government is able to provide them with more control over the revenues and expenditures involved in providing services to their local residents. We decided that the best way to address the issues related to the public finance of local services in California was to study them at the county level. County government is of particular concern given its responsibility for providing health and welfare services to an increasingly large population in the state. Moreover, county governments are highly dependent on state revenues for providing services to local residents. The size and significance of Los Angeles County in California’s structure of governance made it the ideal choice for this purpose. The County of Los Angeles, like all other counties in the state, serves as a principal local government for its residents. This role emerges as a result of the division of the state into 58 distinct regions or counties. Los Angeles County, established in 1850, was one of the state’s original 27 counties. The challenges and issues that the county faces as a regional government are often mirrored in the state’s other 57 counties, and especially in California’s large urban counties. This is because all of the county governments share a common system of state and local government financing of local services that has been shaped by a variety of forces, including the state Constitution, Proposition 13 and its legislative responses, and federal laws and programs. Thus, the findings and conclusions of this report, although obviously of special significance 3 to Los Angeles County and other large urban counties, are relevant to even the smallest and most rural county governments in California. We chose Los Angeles over other counties for several reasons. It is by far the most populous county in the state and, for that matter, in the nation. It is more demographically diverse than any other urban county in the state, offering a glimpse into California’s future. And it recently experienced fiscal problems that serve as an early warning signal of the future challenges it faces in using state and local funds to provide local services (see Legislative Analyst’s Office, 1995). Moreover, the long history of having numerous “contract cities” rely on county government to provide their municipal-level services offers unique lessons about the importance of city-county relationships. Finally, the fact that the county government is also the major provider of many local services for the large populations living in unincorporated areas offers an opportunity to analyze the dual role of the county as a regional government that provides services as an agent of the state and as a local government for those living in incorporated cities. Over the past decade, for example, Los Angeles County has struggled with the problem of keeping its public health and hospital system solvent. The recession of the early 1990s exerted tremendous pressure on the county’s budget and exposed a great weakness in the county’s portfolio of local services—its public hospital and clinic system. During the recession, a combination of reduced county income, state transfers of revenues from the county to the education system, and reductions in federal aid payments resulted in a county budget that hovered dangerously close to bankruptcy and threatened the closure of much of the county’s hospital system. A federal government bailout of the county’s health system—still in force—has allowed the county to avert 4 financial disaster; but despite the bailout, the county continues to underwrite approximately $100 million in hospital costs from its general fund. Without federal assistance, the health department would face a large annual deficit. In our study, we define the services provided by local governments in the broadest sense possible. Some define public services as those activities that cannot be offered efficiently and adequately by the private sector. Others consider public services as activities that governments engage in for the betterment of individuals, communities, and society. Still others see public services as any government activities that affect certain problems and achieve specific goals. We define local services as all of the activities provided by local governments for the benefit of their residents, as measured by their expenditures. Our definition does not differentiate between so-called “essential” services—such as police, fire, and sanitation—and “nonessential” services such as libraries, parks, and recreation. Local services by our definition could be provided to geographical areas of different sizes, including a neighborhood, city, county subarea, county, or multicounty region. Our study of Los Angeles County government commenced in September 1998. We had the full cooperation of senior leadership in the Chief Administrative Office. Our objective was to study local service delivery and the supporting financial structure. We held ourselves to a one-year timetable, so that we could provide information in a timely fashion to the Chief Administrative Officer and other interested local parties, such as the Los Angeles County Citizens’ Economy and Efficiency Commission, as well as the Speaker’s Commission on State and Local Government Finance. 5 Goals of This Study This study had four interrelated goals. 1. Identify the fiscal strains and organizational stresses in the provision of services, as perceived by those familiar with Los Angeles County. We wanted to understand the challenges the county government faces today in providing local services and the opportunities for changes within state, county, and other local government relations. Rather than devising hypotheses only from the fiscal databases, we talked with a number of individuals who are highly informed about the issues. We conducted interviews with a selected sample of county, state, city, special district, and regional officials and civic leaders. 2. Describe and summarize the system for financing countyprovided services. We created a database that included all of the local services the Los Angeles County government provides to its residents, how much was spent for each service, and how each service was paid for. For our study’s purposes, we defined county-provided services as all programs in the county’s 37 departments. We identified 276 countyprovided services, as well as their revenues and expenditures. 3. Describe the broader context of service provisions and revenue collections by other jurisdictions in the county, including cities, special districts, and special agencies. We developed a database of services provided by local and regional governments, so that we could contrast their service data with the county government statistics. This allowed us to understand what services other local and regional governments provide, how much they spend on each, and where they get their funds. Given the very large number of governmental units, we selected a sample that reflects the service activities of a wide range of cities, special districts, and regional agencies in Los Angeles County. 6 4. On the basis of both qualitative and quantitative analysis, identify alternative fiscal and organizational arrangements, if appropriate, for the provision of countywide and local government services. We sought to offer general suggestions about important goals for the county government. We also offered a list of alternative arrangements for providing county services based on our extensive interviews and budget information. We focused on possible changes in the areas of state and county relations, county and local relations, and current activities within county government. Methods The methodology we followed in meeting the four goals of this project is briefly described below. Additional information on our methods is presented in the appendices. Perceived Fiscal Strains and Organizational Stresses We conducted in-depth interviews with people who were highly knowledgeable about service provision. This included elected and appointed officials from county, state, city, special district, and regional governments and community leaders from nonprofit, business, labor, media, academic, and civic organizations. We contacted every member of the county board of supervisors and most of the county’s elected officials and major department heads and asked them to participate in the study. Most agreed to be interviewed in our March to July 1999 time frame. Everyone who was interviewed was granted anonymity, in that their names would not be associated with quotes in this report, to elicit their candid comments. We did tape the interviews to have accurate quotes in the report. A total of 31 interviews were completed, 7 mostly in person, with a few by telephone. The interviews typically lasted from 30 minutes to one hour and included such topics as state and county fiscal relations, county-local relations, and the roles and operations of county government with respect to municipal services in unincorporated areas, contract cities, health care, and regional services. We also asked these people for their views about the future of Los Angeles County and how expected changes might affect the role of county government. Analyses of the County’s Role as a Regional and Municipal Government We derived our data from the 1997–1998 county budget reports (the most recent county fiscal data available at the time the study began). The budget numbers were initially coded from the “County of Los Angeles: 1998–1999 Proposed Budget,” which breaks down the 1997– 1998 proposed budget appropriations and revenues for 276 programs within each of the county’s 37 departments.1 We then updated these data with the “County of Los Angeles: 1997–98 Final Budget,” correcting for the changes occurring after the proposed appropriations. We contacted county departments for more-detailed budget information and clarification, which enabled us to code the county revenues and expenditures into service categories. Keeping in mind the goals of the project, we designed our statistical efforts to provide a descriptive analysis of the local services reported in the county budget. To provide additional context for the county’s role as a municipal service provider, we studied a sample of 24 cities in Los Angeles County. ____________ 1The county’s departments are listed in Appendix A. 8 Special care was taken to create a broad cross-section of cities. We drew our sample from different regions, each of the five county supervisorial districts, contract and noncontract cities, older and newer municipalities, larger and smaller cities, and cities with varying social, economic, racial and ethnic, industrial, and tax-base profiles (see Table 4.1). We identified the revenues, expenditures, and services provided in our sample cities with the attention to detail as our work at the county level. To ensure comparability with the county government statistics, we derived these data from the 1998–1999 proposed and annual city budgets, which contain final numbers for 1997–1998 at the program level. We also gathered budget data from several special districts, functional assessment districts, and property tax agencies, as well as regional agencies and joint powers authorities. Since there are a large number of special districts, we chose the governmental entities that involve most of the expenses for the services to Los Angeles County residents (see Table 4.7). We used the data reported for 1997–1998 in their 1998–1999 budgets. Our purpose here, once again, was to provide a descriptive analysis of the local governments’ budgets with regard to local services.2 Fiscal and Organizational Alternatives On the basis of both qualitative and quantitative analysis, we sought to identify alternative fiscal and organizational arrangements, if appropriate, for the provision of countywide and local government ____________ 2Two notable omissions from the “other local services” category are school districts and redevelopment agencies (RDAs). Given the number and complexity of issues related to school district funding and service provision, an analysis of school districts would require an independent study of at least the scope of the current study. School districts are therefore excluded. Similarly, confronting the range of issues raised by redevelopment agencies would have required a significant diversion from the study’s goals and methodology. For an analysis of redevelopment agencies, see Dardia (1998). 9 services. The project staff each had primary responsibility for different parts of the study, depending on their areas of expertise. Michael Shires analyzed the budget data on county-provided services. Christopher Hoene analyzed the budget data on services provided by other Los Angeles County government entities. Mark Baldassare analyzed the interviews on fiscal and organizational stresses. Aaron Koffman assisted in all three areas. The authors together drafted a set of goals for the county government and a list of alternative fiscal and organizational arrangements, based on the suggestions that were made by those participating in our interviews. In doing this it is not our intention to make a specific set of recommendations or to advocate certain policy changes. Instead, we offer a broad and diverse list of proposals for consideration by local, county, and state policymakers. The Los Angeles Context Los Angeles County is the most challenging environment in the state for local governments to provide services to their residents. Table 1.1 presents a demographic profile of the county, the most populous in the nation with over 9.6 million residents in 1998. The county includes nearly 30 percent of California’s population. It has grown by over two million residents in the past 20 years. In the process, it has changed from a majority white to a “majority-minority” county (i.e., no single racial or ethnic group makes up a majority), receiving more immigrants than any other region of the country except New York. Today, the county’s population is 44 percent Latino, 34 percent white, 12 percent Asian, and 10 percent black. Los Angeles County’s population is projected to increase by another two million by 2020. In the future, Latinos will be 10 Table 1.1 Los Angeles County Characteristics Population, 1998: 9,603,300 (28.9% of California’s total population) Ethnic Distribution of Los Angeles County, 1998 Ethnicity/Race Latino White Asian Black % Share of Population 44 34 12 10 Total 100 Ten Largest Cities in Los Angeles County, 1998 Los Angeles Long Beach Glendale Santa Clarita Torrance Pomona Pasadena Lancaster Inglewood Palmdale Unincorporated areas 3,722,500 446,200 197,600 143,800 143,600 143,200 140,400 127,100 118,500 117,300 997,000 Public Finance Expenditures in Los Angeles County, 1995–1996 Local Government County Cities School districts Special districts Redevelopment agencies Expenditures ($ billions) 10.9 12.2 8.5 2.8 1.5 % Share of Total Local Expenditures 30 34 24 8 4 Total 35.9 100 SOURCES: California Department of Finance (1998, 1999). 11 the majority group (Baldassare, 2000; United Way of Greater Los Angeles, 1999; California Department of Finance, 1998). The demography of Los Angeles County has created a diverse and complex urban region filled with stark contrasts. This social and economic profile has great bearing on the delivery of local services to residents. The county includes some of the poorest and richest communities in the country. Income inequality is highly evident in the population, with the largest number of poor of any metropolitan area and a higher proportion of upper-income households than elsewhere in the state and the nation. Nearly one out of three children lives below the poverty level. Housing is generally expensive and scarce, resulting in more renters than homeowners, the second highest ranking on “excessive” housing costs in the nation, the highest ranking in crowded housing among large metropolitan areas, and an estimated quarter million homeless. About one million residents—10 percent of the county’s population—are currently 65 and older, and this number will increase over the next two decades. One in three adults and one in four children have no health insurance, for a total of 2.7 million residents, largely as a result of low-wage, part-time, and temporary work. Yet, Los Angeles County is also a place with great personal and corporate wealth, which contributes to the region’s potential for addressing some of its formidable needs for services. Nearly 18,000 nonprofits operate in the county, raising $4.9 billion annually in income, with $27 billion in assets (United Way of Greater Los Angeles, 1999). The structure of local government that delivers services in the area is large and complicated, reflecting the geographical size and social diversity of this urban region. The latest figures place the total tax receipts for all local governments at $36.5 billion in fiscal year 1995–1996. Total 12 expenditures for local governments during that same fiscal year were $35.9 billion. Of these funds, 30 percent were spent by the county government ($10.9 billion), 34 percent by the city governments ($12.2 billion), 24 percent by the local school districts ($8.5 billion), 8 percent by the special districts ($2.8 billion), and 4 percent by the redevelopment agencies ($1.5 billion), according to the California Department of Finance (1999). Los Angeles County includes 88 cities. The largest city is Los Angeles with 3.7 million residents. Six other cities have populations of more than 130,000: Long Beach, Glendale, Torrance, Pomona, Pasadena, and Santa Clarita (Swenson, 1999). Nearly one million people, or one in 10 county residents, live in unincorporated areas, receiving their municipal-level services from the county government. There are 58 “contract cities” for which the county government, or another agency, provides municipal-level services on a contract basis.3 The county provides police protection to 41 cities on a contract basis. Fifty-four cities receive fire protection and 51 cities receive library services from two property-tax agencies: the Los Angeles County Fire District (LACFD) and the County Library District.4 Los Angeles County also includes more than 200 special districts that provide services such as water, sanitation, library, and fire services. The county government itself is one of the largest public bureaucracies in the ____________ 3Contract cities are defined here as the cities that are members of the California Contract Cities Association. 4At times throughout this study, we will refer to cities that receive fire and library services through these property-tax agencies as “contract cities.” In most instances, this is the case because the majority of these cities are also members of the California Contract Cities Association. 13 country, including over 84,000 employees in 37 departments delivering local services through 276 programs. Organization of This Report This report is organized around the four goals presented above. Chapter Two summarizes the themes from our interviews with government officials and civic leaders. Chapter Three examines the fiscal data on the issue of the county’s role as a regional government. Chapter Four examines the fiscal data on the issues of the county’s role as a municipal service provider and also provides insights into how the county’s role relates to the role of cities and special districts in providing the same or comparable services. Chapter Five provides a summary of the goals and the list of policy alternatives for addressing the problems and issues raised in this report that were suggested by those participating in our interviews. 14 2. Perceived Fiscal Strains and Organizational Stresses To better understand the current context of service delivery in Los Angeles County, as well as the challenges facing the county government and other local governments that are charged with this task, we interviewed state and local officials and civic leaders who are highly informed about the role of county government in proving local services to Los Angeles County residents. Table 2.1 lists the individuals we interviewed in this portion of the project. We describe below several themes that emerged during our interviews, and we also include a number of direct quotes from those we interviewed. The observations we include do not necessarily represent the facts about fiscal and organizational conditions of Los Angeles County, but we used these observations to formulate hypotheses to be explored in our quantitative analysis of the fiscal data and to guide us in thinking about alternative fiscal and organizational arrangements for providing local services. 15 Table 2.1 Individuals Interviewed Name, Title, Affiliation David Abel, ABL Inc., Los Angeles County Citizens’ Economy and Efficiency Commission Michael Antonovich, Supervisor, Los Angeles County Leroy Baca, Sheriff, Los Angeles County James Bickhart, Field Representative for Speaker Antonio Villaraigosa Yvonne Brathwaite-Burke, Supervisor, Los Angeles County Larry Calemine, Director, Local Agency Formation Commission, Los Angeles County Michael Colantuano, City Attorney, Cudahy and La Habra Heights Rick Cole, City Manager, Azusa; Former Mayor, Pasadena Keith Comrie, Former Chief Administrative Officer (CAO), City of Los Angeles Diane Cummins, Chief Fiscal Policy Advisor, President Pro Tempore John Burton Ron Deaton, Chief Legislative Analyst, City of Los Angeles Mark Finucane, Director, Health Services, Los Angeles County Joel Fox, President Emeritus, Howard Jarvis Taxpayers Association Michael Freeman, Fire Chief, Los Angeles County Fire District William Fulton, Editor, California Planning and Development Report Gil Garcetti, District Attorney, Los Angeles County Joe Haggerty, President, United Way of Greater Los Angeles James Hankla, Chief Executive Officer, Alameda Corridor Transportation Authority David Janssen, Chief Administrative Officer, Los Angeles County Monica Lozano, Executive Editor, La Opinión Harry Peacock, City Manager, Malibu Mark Pisano, Executive Director, Southern California Association of Governments John Perez, Executive Director, United Food and Commercial Workers Union, Region 8 Alexander Pope, Director, California Citizens’ Budget Commission Sally Reed, Chief Administrative Officer, Monterey County; Former CAO, Los Angeles County Constance Rice, Co-Director, Advancement Project James Stahl, Assistant General Manager, Sanitation Districts of Los Angeles County Harry Stone, Director, Public Works, Los Angeles County Steve Szalay, Executive Director, California State Association of Counties Dan Wall, Chief Legislative Representative, Los Angeles County Zev Yaroslavsky, Supervisor, Los Angeles County 16 Perceived Fiscal Strains 1. The county government has little control over the revenues it generates and the money it spends on services for residents. The fact that our respondents thought that the county government does not have the tools to financially cope with the next economic recession is a reflection of their views about state and local fiscal relationships. As a result of Proposition 13, there is a widespread perception that county government has lost control of its major revenue source—the local property tax. Most recognize that the two-thirds majority needed from voters to raise local taxes has severely limited local governments’ abilities to generate new revenues. “Governmental units charged with providing services do not have the power in the current system to establish priorities and effect change,” remarked a civic leader. “The county is especially put upon in that all of its revenue-generating authority has been taken away,” said a state official. “Counties, more than any other form of government, are at the mercy of circumstances outside of their control,” said an elected county official. “The biggest problem we face is the loss of our property tax base,” said another elected county official. This comment reflects the belief that, in filling the service needs of residents today, the county government has become very dependent on state money that usually arrives with strings attached. This circumstance is perceived as leaving county officials with little room for maneuvering in the types and amounts of services they are providing on an annual basis—and little flexibility when revenues and expenditures vary sharply from budget projections, as can be the case during severe recessions. “Since Proposition 13, the real decisionmaking authority for local government resides in Sacramento,” observed a local official. “County government 17 lost the independence it had prior to Proposition 13. Its ability to control its own destiny was taken away,” said a former county official. “We haven’t capped the county’s liabilities, but we have capped the county’s revenues,” said a state official. 2. State, federal, and county governments are partners in delivering local services, but uncertainties about state and federal funding and mandates create tensions. Most respondents felt that the success of service delivery in Los Angeles County depends on a healthy relationship between the state and county governments. Sacramento needs the cooperation of the county to be the “agent of the state” in delivering certain essential services at the regional level, and the county needs the financial wherewithal from Sacramento to provide other local and countywide services to its residents. There was a feeling that the tensions surrounding current state and local fiscal relationships—partly the result of the state taking back funding from the county during the last recession—had done some harm to this key partnership. Some felt that the relationships had improved in recent years as a result of changes in county management and a less stressful budget environment. Still, everyone seemed to agree there was room for improvement. “The state needs to be a true partner with county government,” said an elected county official. “I think we need to move away from a paternal relationship with counties and toward a true partnership. Having a more open and honest dialogue would help both sides,” said a state official. “The state needs to be realistic about what they expect from counties and about what they mandate," observed a former county official. “If the economy takes a turn for the worse, and the state balances its budget on our backs, we’ll be right back where we started,” said an elected county official. “Certainly, the state continuing to take 18 money away from Los Angeles County is a problem. They take away the property tax, give back a little of the sales tax, effectively undercutting local control by taking away the home base,” said a civic leader. “All we hope is that the state will leave us alone and let us manage our own affairs. What we need from the state is a stable, reliable source of income,” remarked an elected county official. “The county leadership is justified in feeling that they shouldn’t be underfunded [i.e., with reference to mandates]. If the state is going to force them to implement certain programs, than the funding should be provided,” said another state official. 3. Health care is a chronic and unsolved problem facing countyprovided services. The county government came close to a fiscal meltdown in 1994–1995 and was saved by a federal rescue plan that paid for the county’s ballooning health care deficit. Although the immediate crisis was averted, no one today seems to think that the problem has been resolved. There are a variety of opinions on the severity of the problem, but consensus that providing health care to the large, uninsured population of Los Angeles County is the most worrisome issue for county government. Most realize that the county government is heavily dependent on a continued federal bailout, and everyone knows that this funding source will not continue indefinitely. “We’ve turned it around, but it could definitely happen again,” predicted an elected county official. “Besides the federal waiver, the county has done some cost cutting since the crisis and has saved themselves about $90 million a year. But, it probably still needs to find a $100 million more,“ said a state official. “Most importantly, the number of uninsured people in Los Angeles County continues to grow rapidly,” observed a county department head. “It is certainly a possibility that the 19 crisis could emerge again. The demands are still enormous,” said a county official. “The county could absolutely find itself in dire straits again,” remarked a regional official. Despite recognition that the federal bailout will not continue indefinitely and the likelihood of another crisis when a recession hits, there is also consensus that county government does not know how to solve the problem. “The deficit is structural and the county has little control over fixing it,” observed one civic leader. “There is no game plan to this day on the part of the county. I haven’t seen that they’ve learned from the crisis,” said a regional official. “It is probably five years until the next crisis,” warned another county official. “I’m not sure that anyone knows what to do about it,” admitted a county elected official. 4. The scarcity of local revenue sources may be leading to decisions that favor commercial growth and local sales tax dollars over the region’s housing and economic needs. More jobs and more affordable housing should certainly be among the priorities for the largest urban county in the state, especially given the level of poverty in the current population and the expected population growth over the next two decades. Many of the leaders we spoke to felt that local development decisions were leaning too much in the direction of retail and commercial building, at the expense of residential and industrial construction, because the former generates new sales tax revenues for the locality and the latter does not (Lewis and Barbour, 1999).1 The ____________ 1Lewis and Barbour (1999) found that local public officials favor retail development over other forms of development, but it is unclear whether this preference has affected urban form. First, there is no evidence to suggest that California has more retail space per person than other states. Second, it is questionable whether the favor given to retail actually leads to differences in retail location. However, Lewis and Barbour also note that 20 proliferation of municipal redevelopment agencies and the system of finance supporting these agencies is also cause for concern (Dardia, 1998). In an era in which local governments have few options for raising their revenues, many local leaders are concerned that the “fiscalization of land use” results in too many local growth decisions being made to raise tax dollars that are not really in the best interest of the region as a whole. “Our fiscal structure for local government is so skewed to sales tax and retail right now that there is no coherent community development,” said a civic leader. “Everybody agrees that the situs approach to sales tax needs to be modified, if not eliminated,” said another civic leader. “Unless we quickly move toward restructuring the state-local fiscal relationship and its impact on land use, we won’t be able to build livable communities in the long term that provide high-quality jobs,” said another community leader. “The current system of finance in the state spawns its own set of behaviors which only make the problems worse day by day,” observed a civic leader, in referring to the fiscalization of land use. 5. Fiscal uncertainties make long-term planning difficult, even though the county government is in better shape today than it was in the mid-1990s. There was near consensus that these are good fiscal times in county government, particularly compared to the dark days of the last recession. Many attribute these positive conditions to forces outside the county government’s control—specifically, the improved economy, increased tax revenues, a reduction in demand for welfare services, and a state budget surplus. Those inside county government also give credit to the management team and a better working ________________________________________________________ the more cities favor retail development over housing and industrial development the more difficult the latter land uses will be to develop. 21 relationship between the county supervisors, other elected officials, and the administrative staff. “Things are going reasonably well, certainly better than they were six years ago during the recession,” said an elected county official. “The professional management has improved dramatically. We’re now talking to each other about what might be coming around the corner,” said a county department head. Yet, there is a belief that the current good times are only temporary and that the county government will find itself in deep trouble again once the economy enters the next inevitable downturn. “I think it is fortuitous that the economy is doing as well as it is, otherwise it would be a disaster. If we have another recession soon, all of the cities and counties will go right back into the tank,” said a local official. “The county has done a terrific job within the past few years. Part of it is because the economy is good. Of course, the good times are only temporary,” said a state official. Perceived Organizational Stresses 1. The size of county government and the large number of local governments operating in the county lead to public confusion about local service delivery. Local government in Los Angeles County includes the county government (84,000 employees in 37 departments), 88 cities, and more than 200 special districts. Thus, it is not surprising that many of those we interviewed described the government in the county as big and unwieldy, whereas others believed that there were just too many cities and special districts. Some felt that the size and complexity of these governmental units led to a “fragmentation” in decisionmaking about 22 local services and a bureaucracy that was too difficult for the public to understand and access. “My overall view is that no one has a clue about what the county does. Part of it, I’m sure, is that LA County is just too big,” said a civic leader. “The county government is just an enormous set of bureaucracies, and it is very difficult to get them coordinated and moving in the same direction,” said another. “The county government is too big and detached to serve all of its residents,” said a city leader. “Having only five people in charge, plus a CAO, is a very difficult administrative structure,” said a civic leader. “We have too many special districts. There are tremendous inefficiencies,” said an elected county official. “Special districts are to government what inefficiencies are to the private sector, said another. “There is some efficiency in terms of how local governments work together, but the public has no clue who does what,” said a local official. Others commented that this situation is exacerbated by the large numbers of immigrants and non-English-speaking residents in Los Angeles County. “The county doesn’t reach out to the Hispanic community at all,” observed a civic leader. 2. The connections between state revenues and local expenditures are so complex that it is difficult to know who should be held accountable for local services. Many of the leaders were troubled by the appearance of a “disconnect” in state and local fiscal relationships that occurs now that local governments are so reliant on state funds. Today, most of the taxes collected at the local level are passed on to the state, which then redistributes the revenues to local governments. Among other things, the current system raises public doubts about what tax 23 money goes to what services, as well as confusion about which branch of government can really be held accountable for delivering those services. “The jurisdiction responsible for providing services needs to have the financial wherewithal to provide those services,” said a city official. “As long as you have the responsibility with the local governments, and the revenue authority with the state, there will always be problems,” said an elected county official. “There is no relationship between the collection of those revenues and the services they pay for,” observed a regional official. “The current system thwarts effectiveness,” said a civic leader. “All we’ve done is inherit an old system through voter and state intervention. It is a chaotic and dysfunctional patchwork,” said a city official. 3. Contract cities (i.e., those cities that provide public services through contracts with the county government) seem to offer an efficient means of providing local services, even though these longstanding city-county relationships are still controversial. The topic of contract cities has for many years generated controversy in Los Angeles County. As this report shows in the following chapters, significant differences exist between contract and full-service cities in how they generate revenues and allocate their resources. Some think that county government should not be in the business of selling local services to cities, and that it should focus its efforts, instead, on being a regional service provider. Large cities have complained that contract cities are not “real cities.” They argue that because county government is prohibited by state law from charging overhead costs to contract cities, the costs are unfairly subsidized by the other cities in the county. Others worry that county government is already stretched too thin to be providing local services to contract cities, and that making cityhood easier to achieve 24 through the contract city mechanism only increases the fragmentation of the region. “The contract model forces the county to give a subsidy to those cities. They don’t pass overhead costs on to those cities,” observed a regional official. “There are too many forms of cities right now. There are a lot of cities that aren’t really cities in the traditional sense,” said a city official. Others believe that the contract city arrangement reduces administrative overhead and service redundancies in the region. They argue that contract cities are a very efficient way to achieve local governance. Most of those we interviewed inside county government spoke only of the benefits of contract cities—such as additional revenues for the county government and incentives to increase efficiency—whereas civic leaders and officials in cities and special districts offered mostly positive but more mixed reviews of this special city-county relationship. “Allowing cities to exist through contracts with the county government allows them to focus on the issues they are primarily interested in—land use,” said one county official. “The upside is a lot of local control. The downside is that you have a more complicated environment in which to try to achieve regional policy,” said a city official. “The contract cities approach is still viable. It allows them to maintain their identities and it overcomes redundancy in service provision,” said a city official. “It is a good thing because it forces competition,” observed an elected county official. “If you believe in giving people a say in local governance, this is a very cost-effective way to go about it,” said another county official. “One of the benefits of Proposition 13 is that it forces efficiencies and different ways to deliver services, like contract relationships,” said one civic leader. “In terms of 25 contract cities, for the county’s purposes, it’s been good,” observed a state official. 4. Unincorporated areas may be an unwanted burden on county government, but many roadblocks prevent their incorporation or annexation by cities. About one million people in Los Angeles County, or approximately one in 10 residents, live in unincorporated areas. They are dependent on county government for their municipal-level services, because they have no city government. Again, this kind of local service activity reduces the county government’s ability to focus on its role of providing regional-level services. Given the revenue-generating limitations faced by the county government, many have suggested that unincorporated areas should be annexed by adjacent cities or incorporated into new cities, thus removing this service burden from county government. “My view is that unincorporated areas should be annexed or forced to incorporate. It gets back to the issue of what is county government,” said a city official. “The unincorporated areas should be annexed or incorporated. It would help the county figure out what it’s spending on municipal services,” said a civic leader. “There ought to be clearly defined levels of services, which means that these areas should be annexed or incorporated,” said a city official. “Counties should be regional service providers and shouldn’t be providing municipal-level services,” observed a state official. Most of the respondents in our study agreed with this idea in principle, though many understood why this process was not moving ahead. For the most part, residents in unincorporated areas seem to be satisfied with the services they are receiving and the cost of local government, so they are not seeking to incorporate, and adjacent cities 26 are in no hurry to annex land that is not generating sales tax revenues or enough property tax revenues to cover the costs of services. “Nobody wants the unincorporated areas right now because they are high cost, in terms of services, and don’t generate significant revenues,” said a county department head. “I think the unincorporated areas are very satisfied with the services they receive,” said a county elected official. “These islands exist for a reason. Either people don’t want to be part of cities, or the surrounding cities do not want to be part of these areas,” said a regional official. 5. County government should work more closely with other local governments, the private sector, and nonprofits in providing local services. Many of the state, county, and local officials and civic leaders we interviewed had a clear understanding of the limitations that the county government was operating under today. The county government could not possibly meet all of the demands for its services, either now or any time in the foreseeable future. This perception reflects a combination of demographic and institutional factors. There is a large and growing population of needy residents in Los Angeles County, but the opportunities for generating revenues to pay for increased services are limited. There is a widespread recognition that the county government needs to improve its ability to be a partner in providing services with other local governments. Although most felt that the relations between the county government and other local governments have improved, many felt that collaborative efforts were still too rare. “If the county, cities, and communities don’t develop a partnership, we won’t be able to deliver services effectively,” said a regional official. “A clearer delineation of roles between the counties and cities is needed, and regional cooperation should be encouraged,” said a city official. 27 “The key is to provide incentives for cities to cooperate,” remarked a civic leader. “People just don’t feel they have a shared stake in the region,” said a city official. “We need more metro government. We have 88 cities—which is kind of ridiculous. There is no natural grouping where different jurisdictions come together,” observed another civic leader. Others want the county government to more actively seek partnerships outside local government, specifically contracting with the private sector and taking advantage of the accumulation of wealth and talent in the nonprofit organizations throughout the region. To succeed, the county government must create a sense of purpose for the region as a whole—an endeavor seldom undertaken today. “The future of local government service provision will be public and private partnering,” said an elected county official. “Public-private partnerships are going to increase in the future. We need to overcome traditional thinking about service provision,” said a state official. 28 3. The County as a Regional Government In its regional role,1 the county has two responsibilities: (1) As an independent county government, it must respond to the needs and preferences of a countywide electorate, and (2) as an administrative agent of the California and U.S. governments, it must implement state and federal initiatives. Both responsibilities are considered part of the county’s regional role because the services provided are delivered to the entire region within the county. In each of these cases, the county government is seen as the vehicle of choice for implementing important regional policies. As an independent county government, the county is granted power and responsibilities by both the state Constitution and ____________ 1The term “regional” is used in this portion of the analysis to describe the county’s role as the overall government for a specific geographic region of the state, including as a superordinate entity with some jurisdiction even within the boundaries of incorporated and independent governments within its boundaries. It is narrowly construed to reflect this role and not in the broader sense of a cooperative effort by several subordinate governments to build and execute a collaborative agenda. 29 statute to locally elect a board of supervisors and to implement policies and make choices that reflect the interests and preferences of local residents. As an agent of the state and federal governments, the county is used as a vehicle to implement larger policy initiatives at the local level and, in some cases, to customize these initiatives to better reflect and accommodate local needs and interests. In both cases, the county government is specifically selected because of its proximity to its residents and constituents and because every person in California is located within the boundaries of a county government. The relative importance of these two aspects of Los Angeles County’s regional role is shown in Table 3.1 in comparison to its role as a municipal services provider (this role is discussed in Chapter 4). Here, we have categorized expenditures for Los Angeles County program by program for the 1997–1998 fiscal year and incorporated them under their respective county roles. The county’s role as an administrative agent of state and federal policy dominates, including 62 percent of expenditures, and its role as an independent county government accounts for 25 percent of expenditures. The remaining 13 percent of expenditures are for municipal services the county provides to both incorporated and unincorporated areas within its jurisdiction. The percentages in the table are derived from the $11.9 billion in total expenditures for both county departments and dependent districts; $11 billion or 92 percent of the total expenditures are from departments. In this chapter, we examine the importance of this distribution of expenditures and explore the issues associated with the county’s role as a regional government. We then briefly examine the broader context and issues raised by this regional role and its implications for local government finance and organization. 30 Table 3.1 Los Angeles County Expenditures, by Role and Institutional Structure, 1997–1998 Role County government Institutional Structure Dependent Departmenta Districts 2,913,284,557 114,752,300 Agent of state and federal governmentsb 7,151,849,582 175,144,100 Municipal service provider 943,098,422 604,004,738 Total 11,008,232,561 893,901,138 Total 3,028,036,857 7,326,993,682 1,547,103,160 11,902,133,699 Role County government Institutional Structure Dependent Departmenta Districts 26% 13% Total 25% Agent of state and federal governments 65% 20% 62% Municipal service provider 9% 67% 13% Total 100% 100% 100% aDepartment totals include budgetary allocations in the Health Services Department related to SB 855 and various miscellaneous funds controlled by county departments. bNote that $450,776,000 of interfund expenditures and $674,166,846 of SB 855 revenues for health services were excluded from these totals to avoid double counting these amounts. The County as an Independent Government Much of the county’s authority as an independent government is outlined in Article XI of the state Constitution and in the Government Code of the State Statutes, which assign a range of privileges and responsibilities to the county government and its elected body—the 31 board of supervisors. Table 3.2 provides a list of Los Angeles County’s responsibilities as an independent government. Included in this list are the county general government, such as the Board of Supervisors and the Chief Administrative Office, as well as the registrar of voters, office of weights and measures, tax assessor, tax collector, and clerk. Also Table 3.2 Responsibilities of the County as an Independent Government General Government Social Services Chief Administrative Adoptions Office Birth/Death Certificates Board of Supervisors Aging County Clerk Career Services and Job County Attorney Training Alternate Public Defender Disability County Counsel Community/Family Small Claims Counseling Assessor Bees/Insect Information Controller Treasurer Civil Services Finance Consumer Affairs Property Taxes Claims Property Ownership Veteran/Military Services Collections Marriage Dissolution Human Resources/ Fraud Personnel Job Information Affirmative Action Marriage Information Systems Ombudsman Legal/Legislative Recycling Annexations/Incorporations Economy and Efficiency Public Safety Commission Sheriff’s Department Elections Flood Control Voter Registration Chemical/Toxicology Purchasing Jails Smog Control Disability Worker’s Compensation Leisure and Cultural Services Parks and Recreation Cultural Centers Public Entertainment Youth and Senior Programs Planning Boundary Changes/Cities and Districts Incorporations of Cities Agricultural Agricultural/Weights and Measures Produce/Egg Quality Other Airports Marina 32 included is the Local Agency Formation Commission (LAFCO), a separate agency created by the state, whose job is to oversee boundary disputes within the county. The table also includes the Sheriff’s Department in its capacity both as the regional law-enforcement agency responsible for providing countywide coordination of law enforcement and as the operator of the county jail system. The Sheriff’s Department also serves a municipal role in the county, as discussed in Chapter 4. Challenges the County Faces as an Independent Government Perhaps the biggest challenge the county faces as an independent government is the pressure created by its public finance system. Although much of the blame for this pressure has been laid at the feet of Proposition 13—the landmark 1978 initiative to roll back property taxes and moderate their growth—many other factors contribute to the fiscal box in which most counties find themselves today. True, before Proposition 13, boards of supervisors did have the ability to raise property taxes to fund local county initiatives. But a closer examination of county revenues points to several other issues as well. Table 3.3 shows Los Angeles County’s revenues for the year of our analysis. When thinking about funding the county governance-related roles identified listed in Table 3.2, one would automatically look for countyderived and -determined revenues. In Table 3.3, this would include the property tax, the sales tax, other taxes, and service charges and fees (i.e., a revenue stream that reflects the government’s efforts to recapture the cost of service provision through user fees). In this table, we see that they total $3.29 billion, more than covering the $3.03 billion in county 33 Table 3.3 Los Angeles County Revenues, 1997–1998 Revenue Property taxesa Sales taxes Other taxes Service charges and fees Intergovernmental revenues Other revenues Debt proceeds Amount, $ 1,872,350,364 57,562,795 71,277,173 1,293,004,487 7,517,923,247 742,496,974 510,377,833 Share, % 15 1 1 11 62 6 4 Total 12,064,992,873 100 NOTE: A detailed departmental summary is presented in Appendix C. All internal fund transfers and $674,166,846 of SB 855 revenues were excluded to avoid double counting the amounts. aThis includes all property taxes under the control of the Los Angeles County Board of Supervisors. Of these taxes, $668,173,522 is generated by special district-funded activities (such as fire and library) and is not fungible for other purposes. government expenditures we identified in Table 3.1. However, of the $3.29 billion in property tax revenues, some $667 million represents property tax streams that are required by law to be spent on specific, municipal service-related activities, such as fire protection, storm drains, and street lighting. Thus, only $2.62 billion of these generally fungible monies is available to fund county government programs. Furthermore, these monies must also be used in many instances to provide municipal services to unincorporated areas, as discussed in Chapter 4. This property tax level is not, however, purely a result of Proposition 13. True, Proposition 13 did result in a significant reduction in property tax revenues overall and prevented locally elected officials from raising the property tax rate. However, during the recession of the early 1990s, 34 the state government sought to relieve the fiscal pressure on its budget by transferring a significant portion of city and county property tax revenues to school districts. The now-infamous Education Revenue Augmentation Fund (ERAF) has been the subject of significant debate today as county and city officials attempt to recapture these lost monies in the cash-flush times of the late 1990s. Another factor contributing to the fiscal pressure felt by the county is the lack of a local, diverse, discretionary funding pool. The property tax remains the primary component of the county’s local funding, and Proposition 13 eliminated both the local and the discretionary aspects of this revenue. Unlike cities, and especially charter cities, counties have very few alternative sources of revenues. Sales taxes and other taxes each account for only 1 percent of county revenues. In most cases, the county receives these revenues only for transactions within its unincorporated areas. With the sales tax, for example, the county can collect sales taxes only (1) for designated transit purposes, (2) for sales in unincorporated areas of the county, and (3) within city jurisdictions that have chosen not to assess their full share of the Bradley-Burns sales tax (currently, all cities are assessing their full share). Since unincorporated areas are historically sparsely populated and often incorporate once they grow large enough to generate significant sales tax, franchise fee, hotel tax, and business license revenues, the county has little opportunity to realize any significant revenues from these sources. At the same time, there is considerable local and state-level concern that the concentration of sales taxes at the city level creates counterproductive incentives for these governments that lead to a wide range of unintended consequences, including a shortage of housing and uneven economic development. Although this report does not examine 35 these issues in detail (see Dardia, 1998, and Lewis and Barbour, 1999, for a thorough analysis of some of these issues), many of the solutions discussed point to the need for a more regional allocation of these revenues—a result that, if properly implemented, could go a long way toward diversifying the county’s revenue pool and its reliance on the property tax. As a result of the current state-local fiscal relationship, the county faces considerable financial strain in trying to fund the activities associated with its role as a county government. Where do the additional monies come from to fund these activities? In many cases, they come from transfers from the federal and, especially, the state government. In recent years, for example, the state has increased the number of programs for which it provides direct funding and has, in some cases such as welfare reform, created incentive programs that allow counties to spend revenues in excess of costs on other purposes. The magnitude of the county’s reliance upon other levels of government for its revenue stream does not necessarily represent a problem if the other actors in the intergovernmental revenue process were to simply pass the revenues through with no strings attached. Unfortunately, this is usually not the case. Shires (1999) found that discretionary spending among local governments has fallen dramatically over the past 20 years, and especially for counties. The County as an Administrative Agent of the State and Federal Governments The second responsibility of Los Angeles County in its role as a regional government is to serve as an implementing agency for the state 36 and federal governments. As shown in Table 3.1, 65 percent of the county’s departmental expenditures and 62 percent of its overall expenditures are for activities resulting from edicts and policy actions by these two superordinate governments. This role is not new to county government. Since the early 1900s, counties in California have been the implementing arm of the state for a wide range of policy initiatives, such as care of the indigent and poor. Even as early as the 1920s and 1930s, a significant portion of California county budgets came from the state. (For a more detailed examination of the historical relationship between the state and counties in California, see Silva and Barbour, 1999.) Yet today, the situation is much more complex. Fiscal and structural pressures, such as those we discussed above, have rendered the county particularly vulnerable to any increased demands on its resources. The types of programs that the county administers in its agency role and the ways that the programs are assigned, however, lead precisely to the increased pressures and strains on the county budget. Table 3.4 lists the programs that the county undertakes in its agency role. Although these activities accomplish goals that are in county residents’ interests, they have traditionally been established, funded, and maintained by the federal and state governments. In the context of this analysis, these activities represent areas where the county serves as the implementation agent for broader state and national objectives. These programs largely include the county’s welfare support programs (funded primarily through federal dollars with major state oversight), the county’s hospital and public health enterprises, various federal jobs and housing 37 Table 3.4 Agency Roles of Los Angeles County Social Services Career Services and Job Training Community/Family Counseling Welfare Public Health Public Health Programs Hospitals Development and Housing Housing Assistance Development and Housing Public Safety Courts programs, and most mental health programs.2 In all of these cases, nearly all of the discretion relating to the eligible populations and the level of benefits is determined and funded by other levels of government. The court system is included here because it effectively functions as a state agency under the Trial Court Funding Act. Challenges the County Faces as an Agent of the State and Federal Governments From a broad perspective, the county’s agency role makes a lot of sense. The state and federal governments have very large geographic ____________ 2Until the budget crisis during the recession of the early 1990s, this responsibility was largely shouldered and administered by the state. After 1992, it was assigned to the county along with monies transferred to the county through the motor vehicle license fee—a revenue stream now being phased out. 38 boundaries and strive to set policy priorities that reflect state and national interests. At the same time, these two levels of government have very blunt policy instruments that are not particularly effective in responding to local needs, interests, and differences. Thus, they assign the implementation of their policy initiatives to units of government that (1) are locally elected and hence responsive to local preferences, and (2) encompass all of the physical geography of the state and nation—i.e., county governments. Three factors, however, are problematical: (1) unfunded mandates, (2) maintenance of effort requirements, and (3) unfunded operating costs. Each of these factors produces increased fiscal pressures on the county’s already limited resources. Unfunded Mandates. Unfunded mandates occur when the federal or state government requires the county to provide a service and does not provide sufficient resources to fund the activity. Although Proposition 4 in 1979 theoretically prevents the state from requiring local governments to provide services without providing the corresponding funding, two complications arise: (1) The definitions surrounding mandates are very narrow and take years to litigate,3 and (2) restrictions typically apply only to new state policy initiatives, and thus escalating costs in pre-existing programs are typically not factored into the equation. Mental health services are an excellent example of the latter issue. In 1991–1992, the state transferred control of the majority of the state’s mental health ____________ 3An excellent example of this problem, although not county-specific, is special education in California’s school districts. It has taken several years and a major lawsuit even to bring the state to the bargaining table to try to get the state to pay the actual costs of providing state-mandated special education programs, and yet the state continues to delay resolution on the issue. There is currently some pressure on Governor Davis to negotiate a settlement to the lawsuit, but it has yet to happen. 39 system to county governments as part of its “realignment of state and local government.” In this action, the state also transferred a revenue stream to counties in an effort to provide some funding for these services, although the funding was not at the same level that the state had previously spent on mental health. Concurrent with the growth in overall health costs during the 1990s, the unit cost of the mental health programs has grown dramatically. But the state has yet to review whether the revenue stream it provided in 1992 has grown enough to meet rising costs. In fact, in many cases, it has not, which has resulted in significantly lower levels of service provision or increased cost to the county’s general fund revenues. Maintenance of Effort Requirements. The costs of the county’s role as an agent of the state and federal governments is further exacerbated by the popularity of “maintenance of effort” and “matching fund” requirements in state and federal policy initiatives. These provisions require the county to meet federal- and state-defined levels of expenditures and program efforts to be eligible for support. The goal of such provisions in state and federal policy initiatives is twofold: (1) to encourage local governments to take specific actions consistent with the legislature’s intent and (2) to curtail abuses of monies made available to local governments. An interesting example of this kind of intervention is the ongoing debate over the size of Los Angeles County’s new general-purpose hospital, which would replace the quake-damaged, 870-bed Los Angeles County-University of Southern California Medical Center. State lawmakers are exerting pressure on the county government to make the new hospital larger (increasing its size from 600 to 750 beds) as a condition of receiving state dollars—not only for the project, but also for 40 other unrelated purposes. This pressure to expand continues, despite a 4-1 vote by the board of supervisors in favor of the smaller hospital, fueled by concerns over the county’s ability to fund the operating costs of a larger facility and by federal pressure to have fewer beds. Unfunded Operating Costs. The county’s role as an agent of the state and federal governments is accompanied by significant intergovernmental transfers. As shown in Tables 3.1 and 3.2, 62 percent of the county’s revenues come from other levels of government, and 62 percent of its programmatic expenditures are related to its agency role. At the most aggregate level, one would think that this is the optimal situation because equal proportions of the county’s budget are assigned by superordinate levels of government and then funded by those levels. The reality, however, is quite different, since portions of these state and federal monies are earmarked for specific purposes and thus cannot be moved from program to program to cover the overall costs. The fact that intergovernmental revenues are often inadequate to cover all of the specific expenditures needed for a program is evident when we analyze the budget at the program level. For example, the cost of providing the health services required by the state exceeded the intergovernmental revenues received by nearly $211 million in 1997– 19984 and estimates today remain at about $100 million. Similar calculations for the Children and Family Services and Public Social Services Departments produce funding shortfalls of $50 million and $407 million, respectively. Even though intergovernmental revenues are but one portion of the funding for these departments, it is still clear that ____________ 4This calculation compares those programmatic expenditures in the Health Services Department that we have identified as a result of the county’s agency role with the total intergovernmental revenues received by the county’s Health Services Department. 41 the county annually provides significant additional funding from its general resources to pay for these programs—programs that often exist at the behest of other levels of government—leaving less for programs that are initiated by the county. Special Case Study: Health Services The Health Services Department represents an excellent opportunity to study the county’s role as an agent of the state and federal governments and the problems that can arise as a result of these relationships—in this case, nearly resulting in the bankruptcy of the county. Since the early 1990s, Los Angeles County has struggled to keep its public health and hospital system afloat. The recession at the outset of the decade exerted tremendous pressure on the county’s budget and exposed the great weakness in the county’s portfolio of local services—its public hospital and clinic system. Depending on which set of numbers one uses, the county’s Department of Health Services spent either $2.4 billion, $3.3 billion, or $4.2 billion in 1997–1998. Much of the difficulty in ascertaining precisely how much was spent in Los Angeles County hospitals has to do with the complex matching fund procedures and requirements introduced by SB 855.5 In any case, the total expenditures are significant and are supported by private payments (insurance and fees), federal payments (Medi-Cal, Medicare, and grants), state payments (vehicle ____________ 5SB 855 is a state program that requires payments by public hospitals to the state so that the state may obtain matching funds from the federal government. The monies are then returned to the local jurisdictions from which they were obtained. The matching monies received from the federal government are allocated according to a separate formula. In the county’s accounting systems, these funds are either excluded ($2.4 billion), included once ($3.3 billion), or reported twice (once on disbursement to the state and once on expenditure by the county—$4.2 billion). 42 license fees, grants, and special fees), and county contributions. The latter totaled some $150 million to $350 million in 1997–1998 and remain at about $100 million today. They reflect monies that the county must take out of its general discretionary funds to underwrite the operation of the hospital system—a function and role that is almost entirely determined and assigned by the federal government. During the recession of the early 1990s, the Los Angeles County budget faced a triple-hit: (1) Because of the most severe recession in recent history, overall public revenues declined dramatically, (2) the state took an additional $1 billion of county revenues through the ERAF and replaced only $400 million, and (3) the implementation of new federal caps and rules on the amount of supplemental aid the federal government could provide led to a decline in Los Angeles County’s federal payments. In addition, the county used several one-time measures—including accelerating future federal payments under the SB 855 program—during the early years of the recession (1992–1993 to 1994–1995) in an attempt to “ride out” the fiscal storm. As a result, by 1995–1996, the county budget hovered dangerously close to bankruptcy, with few options left. The 1995–1996 proposed budget ignited more controversy when it proposed the closure of a majority of the county’s local health centers and clinics and the LA County-USC Medical Center.6 Although some argue that this was simply political posturing to obtain fiscal relief from outside the county, it does point to the severity of the fiscal situation created by the county’s budgetary constraints and service obligations. In ____________ 6Some alternatives were also provided, including closing all hospitals except CountyUSC and the Martin Luther King Medical Center. 43 any case, the proposal ignited a firestorm over the provision of local health services to Los Angeles County’s substantial uninsured population—a role assigned to the county by the state and federal governments but funded in a haphazard and patchwork way. Just days before the board of supervisors were to act (a plan that included closing 28 of 39 health clinics and six community hospitals— including LA County-USC), the federal government bailed out the county by providing $364 million, largely through waivers of the federal government’s Medicaid rules for reimbursement. Of course, these monies also came with strings attached. The federal government called for the county to drastically increase the number of patients seen in lower-cost outpatient clinics, to reduce the number of hospital beds in the county by one-third by the middle of 2000,7 to generate major reductions in administrative costs, and to increase its investment in preventive care for its uninsured clientele. In the ensuing years, the county greatly expanded its outpatient clinic network from 45 to 149 clinics and decreased its total beds by 28 percent. The desired savings on overall costs were much more elusive, and today the county is still far short of its goals. The federal government, however, rewarded the county’s progress by extending its relief package for three additional years through 2000, despite a decline of almost one million patients using the county’s outpatient clinics. Today, the county faces a difficult dilemma as a result of the conflicting issues and priorities of its two masters—the state and federal governments. Although the leadership of the California legislature is ____________ 7Ironically, some of the provisions waived by the federal bailout appear to create incentives to keep patients in hospital beds instead of pursuing less costly outpatient treatment. 44 exerting pressure on the board of supervisors to expand the size of the county’s new general-purpose hospital to 750 beds (as discussed above), the federal government has made it an explicit condition of the bailout monies that the county reduce the number of beds in its system. Without the federal waiver, the health department would face an annual deficit of about $300 million. With the renewal of the federal waivers looming, the supervisors face some difficult choices. Fiscal and Organizational Issues Relating to the County’s Role as a Regional Government As the complexity and contradictions inherent in the health services context show, the county’s role as a regional government is difficult to address. The two components of the county’s regional role—i.e., as an independent government and as an agent of the state and federal governments—are in some ways incompatible. As a provider of countywide services, the county must respond to its immediate constituents—the residents and voters of Los Angeles County. At the same time, the fiscal realities of modern county finance demand that the board of supervisors answer first to the state and federal governments to ensure that they receive needed local services. However, in many instances, answering to the state and federal governments first does not assure adequate funding of county activities. We review below some of the findings of our fiscal analysis, which support the perceptions expressed in our interviews with county officials and others knowledgeable about the county’s activities. 1. County government has little control over its revenues. Perhaps the greatest issue facing Los Angeles County is its lack of control over its revenue stream. General discretionary revenues are in short supply. For 45 instance, only 10 percent of overall revenues come from unrestricted property taxes. Several other studies (see Shires, 1999, and Swenson, 1999) have pointed to county governments’ lack of local discretionary revenues in California. 2. County government has little control over its expenditures. Some 62 percent of the county’s expenditures fall under its agency role; thus, much of the county supervisors’ work relates to implementing state and federal initiatives as opposed to seeking local solutions to local problems. This complicates the chain of accountability between voters and elected officials. When few resources are available to lawmakers and few options for their expansion, it is difficult or even unfair to hold supervisors accountable for a lack of effort or intervention in a discretionary area. 3. Uncertainties about state and federal mandates, notably in the area of heath care, create intergovernmental tensions over local service delivery. In the case of state and federal intergovernmental transfers, the monies typically come with strings attached and frequently further diminish local control because of embedded matching fund and maintenance of effort requirements. This is ironic in that one reason for using a local bureaucracy rather than a state or federal bureaucracy to implement programs is to allow a better match of funds to local needs and purposes. This lack of county discretion, however, is very real and significantly impedes its ability to respond to local interests and purposes. Moreover, in several instances, the county spends more on state and federally mandated programs than it receives in intergovernmental programs. A prime example is expenditures for health services, which cause tensions between local, state, and federal government over the delivery of local services. 46 4. Fiscal uncertainties make long-term financial planning difficult for county government. Another problem we have identified in our fiscal analysis is the lack of diversity in the county’s funding base. Beyond intergovernmental transfers, which contain their own level of uncertainty, Los Angeles County’s primary discretionary revenues come from property taxes and service charges. And even the property tax is not completely under the county’s control, as the state demonstrated during the recession of the 1990s. Other local governments, especially cities, have much more diversified revenue portfolios, relying much more heavily on such sources as business licenses, transient occupancy taxes, utility taxes, sales taxes, and franchise fees. The county is precluded from most of these forms of revenues except in the sparsely populated, highcost-of-service unincorporated areas. As a result, the county’s fiscal fortunes rise and fall at the behest of state and federal generosity. 5. The county government’s role as an implementing agent of the state and federal governments creates significant organizational problems. Organizationally, Los Angeles County’s role as a regional government is complex. Not only must it serve as an arbitrator between the various cities and special districts within its boundaries, but it must often serve as an arbitrator between the state and federal governments when the implementation of programs involves inconsistent decisions or goals. Such conflict of interests, illustrated in the debate over the size of the Los Angeles County-USC Medical Center, places county officials in the awkward position of resolving issues that should have been considered at the originating level of government. 6. The size and scope of Los Angeles County as a single government leads to confusion about the delivery of local services. The county government is a massive and complex bureaucracy, and this 47 contributes directly to confusion about its roles and objectives. For example, even with the full cooperation and direct assistance of county officials, it took the authors of this report months to fully understand how the many county departments and agencies provide local services to county residents. It is inconceivable, therefore, that the average citizen can fully understand many of the county’s complex policy decisions. This, in turn, leads to public confusion and misunderstanding about the county’s goals and problems. In general, the county’s role as a regional government, and especially as an agent of the state and federal governments, dominates its day-today operations. This leads to conflicting responsibilities as the county tries to serve the local constituencies and broader state and national interests, often without adequate resources. This dilemma, in turn, leaves the county’s constituents in an ongoing state of frustration and confusion about the cause of the county’s problems, the solutions to those problems, and who should be held accountable for making things right. Moreover, the distractions raised by the county’s dominant role as an agent of other governments lead to a reduced focus on regional issues. Although the county government is in an ideal position to tackle pressing regional problems, such as traffic congestion, housing mix, and economic development, the vision and leadership—not to mention the fiscal ability—to resolve such important public policy issues are currently absent. 48 4. The County as a Municipal Government Overview Los Angeles County also serves as a significant provider of municipal services, in addition to its regional role as a provider of countywide services and as an implementing agent of the state and federal governments. The municipal services role is the most complex aspect of county service provision. The institutional arrangements include both direct county spending on services to unincorporated areas and extensive use of dependent special districts to both fund and provide specific services. The county’s role is also complicated by its provision of a range of services on a contract basis to incorporated jurisdictions within its boundaries. For example, the Los Angeles County Sheriff’s Department serves as the primary police department for many cities within the county, in addition to the communities in unincorporated areas. Within the municipal services role, the county provides services in three ways: 49 (1) County departments provide municipal services directly to residents of unincorporated areas, (2) special districts directly or indirectly under county control provide services to residents of both unincorporated areas and incorporated cities, and (3) county departments provide municipal services to residents of incorporated cities through contractual arrangements. These three approaches in providing municipal services are examined in detail below. Along the way, we offer some insights into the fiscal and organizational issues explored in the interviews and discussed in Chapter 2. Los Angeles County is of course not the only provider of municipal services within its boundaries. Within the county’s 4,000 square miles are also 88 cities and over 200 special districts that also deliver public services. The sheer number and range of governments providing municipal-level services supports the contention of many of those interviewed that the size and number of local governments in the area breed confusion. To explore this issue, we examine below the broader context of local service funding and provision, supplementing our analysis of county-provided municipal services with a sample of 24 cities and five special districts (see Table 4.1).1 Services Provided by Municipal Governments Although the county under state law is the “provider of last resort” for local services, cities are the “providers of first resort” for municipal services. By “municipal services,” we imply that the responsibility for ____________ 1The sample of cities and special districts was selected in such a way as to represent a cross-section of the county in terms of geography, population, racial and ethnic diversity, and institutional structure. 50 Table 4.1 Sample of Other Local Governments 1st District Los Angelesa Bell Gardens Irwindale Monterey Park Pomona Rosemead Cities, by County Supervisorial District 2nd District 3rd District 4th District Los Angeles Los Angeles Los Angeles Compton Beverly Hills Cerritos Gardena Malibu Lakewood Hawthorne Santa Monica Long Beach Inglewood West Hollywood Manhattan Beach Signal Hill 5th District Los Angeles Bradbury Glendale Pasadena Santa Clarita Walnut Special Districtsb Dependent Special Districtsc Independent Special Districts Los Angeles County Fire District Metropolitan Water District Los Angeles County Library District Sanitation Districts of LA County Community Development Commission NOTE: Contract cities appear in boldface. aPortions of the City of Los Angeles are included in each of the five districts. bWe use the term “special districts” to refer to property tax agencies, functional assessment districts, and special districts. cSpecial districts are considered dependent or county-governed, if they are under the direct control of the County Board of Supervisors. certain services lies first with the municipalities themselves. Put simply, if the entire area within the county’s boundaries were incorporated within cities, there would be no need for the county to engage in these service activities at all. Cities in the sample spent more than $13 billion on municipal services in 1997–1998, an amount similar to that spent by the county for all of its services. The range of services provided by the 24 sample cities is presented in Table 4.2. General areas of municipal service provision include public safety (police and fire); social services (family and senior programs, job training); public health; culture and 51 Table 4.2 List of Municipal Services General Government Public Officials Mayor Council Manager/Administrative Officer Clerk Attorney/Legal Services Auditor/Controller Treasurer/Treasury Program Prosecutor/Prosecution Administrative Administration/Central Services Insurance/Liability/Risk Management Intergovernmental Relations Finance Property Ownership/ Management/Maintenance Human Resources/Personnel Information Systems Purchasing Central Stores/Warehouse Resident Services Smog Control/AQMD Programs Weed Abatement Pest Control Volunteer and Community Support Programs Public Safety Police Police/Law Enforcement Parking Fire Fire Paramedics/EMS Flood Control Leisure and Cultural Services Libraries Parks and Recreation Parks and Recreation Park/Open Space Maintenance Beach/Harbor Cultural Centers and Activities Sports Facilities Public Entertainment/Special Events Youth and Senior Programs/Centers Television/Media Public Works Administration Transportation Street Maintenance Median/Parkway Maintenance Bikeway/Pedestrian Facilities/Maintenance Lighting Engineering Building and Safety Inspection/Regulation Code Enforcement Sidewalk Maintenance Tree Maintenance Traffic Control (Signals and Signs) Environmental Compliance Social Services Human Services Senior Services Family Services Employment and Career Services Public Health Public Health Enterprise Activities Power Water Sewers/Sanitation Garbage and Recycling Transit Proprietary Departments: Airports/Harbor/Oil Debt Service/Public Financing Capital Improvements Animal Regulation/Control Housing Housing Assistance Block Grant (CDBG) Other Emergency and Disaster Preparedness Planning and Development Planning Planning and Permitting Zoning Development Community Development Economic/Business Development Redevelopment Agencies NOTE: For a list of municipal services by city, see Appendix E. CDBG is Community Development Block Grant. AQMD is Air Quality Management District. EMS is Emergency Medical Service. 52 leisure services (libraries, parks and recreation); public works (streets, engineering); planning, development, and housing; general government (public officials, administration); and a variety of enterprise activities such as water and power provision and solid waste collection. Although the responsibility for these services lies first with the municipalities, many cities use a number of alternatives to providing these services themselves. Through these alternatives—which include contracting relationships and arrangements with special districts under county direction—the county plays a significant role as provider of local services, such as police/law enforcement, fire protection, libraries, parks and recreation, planning, and public works. As noted in Chapter 3, expenditures for municipal services account for 13 percent of total county expenditures. We discuss in greater detail below the various mechanisms by which municipal services are provided, and the institutional arrangements that result between the county, cities, and special districts in delivering these services. Mechanisms for Providing Services Municipal services in Los Angeles County are provided by the county, cities, and special districts through three institutional mechanisms. The first of these is direct provision, in which the county provides municipal services to unincorporated areas through county departments, and cities provide services to their residents through municipal departments. The second mechanism is through a host of special districts, including specifically drawn assessment districts, countygoverned special districts, and special districts that operate independent of county or city control. The final mechanism for providing municipal 53 services is through contract service provision, which involves contractual relationships between the county, cities, and the private sector. Direct Provision Services are often provided directly by the jurisdiction governing a given area. The entity responsible for providing a given service, however, can vary by location. Unincorporated Areas and the County. The county is obliged to provide municipal services to those residents who do not reside within the boundaries of an incorporated city.2 Because of the extensive scale of the unincorporated areas in Los Angeles County, the county serves as a provider of municipal services to a significant number of county residents. Some 900,000 people live in unincorporated areas, and the county government must provide them with the range of services normally provided by a city government: police and fire protection; zoning and general plan administration; libraries; parks; roads; and basic utilities including water, sewer, and refuse collection. About 30 percent of the municipal services provided by the county are provided directly by county departments. The largest providers are the Sheriff’s3 and Public Works Departments, as shown in Table 4.3. Incorporated Areas. Many cities, particularly the older and larger cities in the sample, provide a full range of municipal services to their residents through city departments. Other cities provide a more limited range of services directly and use other mechanisms to provide some key ____________ 2If they did reside within the boundaries of an incorporated city, the city would bear the burden of providing these services to its residents. 3See Appendix B for a discussion of the methodology used to identify this portion of the overall Sheriff’s Department’s expenditures. 54 Table 4.3 Los Angeles County Municipal Services Provided, by Department and Institutional Arrangement, 1997–1998 Department Municipal Agricultural Commissioner/ Weights and Measures Animal Care and Control 3,520,000 Beaches and Harbors 5,570,862 Community and Senior Services 1,381,000 County Counsel District Attorney Information Systems Advisory Body Internal Services LAFCO Parks and Recreation 24,197,994 Probation Public Library 58,168,303 Public Works 209,567,949 Regional Planning 7,193,819 Registrar-Recorder/County Clerk Sheriffb 85,165,673 Treasurer and Tax Collector Enterprise Funds 58,860,710 Dependent Special Districts Contracta 380,000 5,220,000 605,000 2,162,569 99,850 175,504 3,373,732 30,381 2,080,460 287,876,423 1,722 3,281,965 138,972,098 1,642,094 29,175,307 Dependent Districts 574,829,431 Total 380,000 8,740,000 5,570,862 1,986,000 2,162,569 99,850 175,504 3,373,732 30,381 24,197,994 2,080,460 58,168,303 497,444,373 7,195,541 3,281,965 224,137,771 1,642,094 58,860,710 604,004,738 Total 453,626,310 475,077,105 574,829,431 1,503,532,846 Share of municipal revenues, % 30 32 38 100 aWe requested detailed information from each department on services that were provided on a contract basis to other local governments. Given the county’s policy of billing the client for all nonoverhead costs for such services, we assumed that contract revenues directly corresponded to the appropriate contract expenses for that activity. bIn the case of the Sheriff’s Department, there was also an issue related to the cost of providing police protection to unincorporated areas of the county. It is difficult to separate the Sheriff Department’s role as the countywide law enforcement agency from its role as the police department of both unincorporated areas and contracting cities. In this analysis, we assert that because police services to unincorporated areas are often provided from the same substations throughout the county as the contract services, the relative costs should be approximately the same. Because of the county’s contracting activity, we do have good estimates of the costs associated with providing these contracting services. Subsequently, we used the average contracted cost per resident of a contracting incorporated city to generate an estimate of the cost per person that was then applied to the unincorporated area population. This produced an estimate of the county’s cost of providing these municipal services in unincorporated areas. The balance of the department’s expenditures was then attributed to the county’s regional role. 55 services. Cities such as Los Angeles, Long Beach, Pasadena, and Santa Monica typically provide police services through their own police departments, fire protection through city fire departments, and library services through their own library departments, whereas other cities provide these services through contracts with the county or through special districts. The differences and similarities between these “fullservice” cities and contract or partial-service cities,4 and the issues raised by these arrangements, are examined below in the section on contract service provision. Special Districts The second mechanism for providing municipal services—special districts—is the most complex. These districts come in many forms, three of which are included in this study. The first is the specifically drawn assessment district, which is created for the purpose of levying a special assessment on the users of a service within a specifically defined area. These districts are typically quite small, no larger than a few city blocks in some cases, and offer specific services such as street lighting and landscaping. Some of these districts are county-governed, as explained below. A second type of special district is the county-governed special district. Throughout the history of Los Angeles County, a range of special districts have been established explicitly for the purpose of ____________ 4The term “contract city” is used in this report to denote cities that provide services through contract relationships with outside agencies or through memberships in special districts. However, most special district arrangements are not contractual. Instead, cities are members of districts that provide a specific service funded by direct property tax passthroughs from the cities to the districts themselves. Coleman (1999) refers to these cities as “partial service cities.” 56 providing a type of service to a specific area within the county. Services provided by county-governed special districts include fire protection, libraries, sewer services and maintenance, street lighting and landscaping, flood control, and storm drain maintenance. Some of these districts are large, providing services to a broad swath of the county, such as the LACFD and the County Library District; others are smaller, such as the many street lighting and landscaping districts throughout the county. Each of these special districts is governed either directly by the board of supervisors or indirectly by a department under the control of the board of supervisors. Services provided by these special districts account for 38 percent of the municipal services provided by Los Angeles County, as shown in the “share of municipal revenues” row in Table 4.3. County-governed special districts are significant providers of key services to many cities, particularly fire protection and libraries. The relationship between cities and county-governed special districts takes two forms. Cities that were members of these districts before the passage of Proposition 13 contribute revenues to the districts through direct property tax pass-throughs, receiving fire protection and library services in return. In the case of the fire district, cities that were not members of the district before Proposition 13—meaning that their property tax revenues are not sufficient to pay for fire services—can contract directly with the fire district. Table 4.4 shows the number of cities that are members of the fire and library districts and the number of cities that contract directly with the fire district. Through such county-governed special districts, the county provides fire protection and library services to over half the cities in the county. 57 Table 4.4 Los Angeles County Cities Receiving Municipal Services from the County, 1997–1998 Department Animal Care and Control Fire Protection Library Police Protection Public Works No. of Cities in County No. of Cities % Special Contracting Contracting Districts 49 56 7 8 47 0 51 41 47 88 100 % in County Special Districts 0 53 58 0 0 % Using County as Municipal Provider 56 61 58 47 100 The third type of special district is the regional district, which operates independent of county government. These districts are usually large regional organizations managing a confederation of smaller districts and providing a specific service, as is the case of the Sanitation Districts of Los Angeles County and the Metropolitan Water District, which provide sanitation and water services to a large part of the county. The property tax is an important source of income for funding the activities of many districts that were established before the passage of Proposition 13. These districts were established largely to provide property-related services to specific parcels within the county, and the cost of that service provision was allocated to those parcels through the imposition of a property tax. Proposition 13 and its subsequent implementing legislation, however, changed the way that the process worked. This proposition set the statewide total property tax rate at 1 percent and AB 8 allocated those significantly lower revenues5 as a ____________ 5Comparable property tax rates averaged about 3 percent at the time of Proposition 13’s passage. 58 function of the overall distribution of property taxes in 1976. As a result, these districts continue to receive property tax revenues, but at a level much lower than they had previously received. The constraints on the property tax—the primary revenue source for most of these districts—have created a framework that is almost completely nonresponsive to reform. Because the state legislature controls the allocation mechanism for these revenues, it is difficult for the county to entertain proposals for reorganizing these districts to better suit the county’s purposes. At the same time, these districts and their attendant services continue to be controlled by the county government or to operate independently even when the residents within their boundaries incorporate. As a result, the municipal services these residents receive, in the case of the county-governed districts, are determined by the more distant county government rather than their local city councils. In the case of independent special districts, the decisions are made by boards of directors composed of representatives from each member city and from the county board of supervisors. The result is that the special district mechanism for providing local services has become increasingly complex and contributes to widespread confusion among residents and public officials about how these services are provided and funded. Adding to the confusion is the fact that resident property tax dollars are collected and then passed through to these districts, making it difficult for residents to know whom to hold accountable. The County as a Contract Service Provider The third mechanism for providing municipal services—shown in the second column of Table 4.3—is the contractual approach wherein 59 county departments provide services under contracts with other local governments—generally cities. As Table 4.4 shows, many of the county’s incorporated jurisdictions contract with the county for important municipal services. Rather than forming their own police or fire departments, for example, many cities contract with another government—often the County of Los Angeles or one of its subordinate districts—for those services. This approach—often called the “Lakewood Plan” after one of the first cities to adopt it—has resulted in the county serving as a major provider of municipal services. The County Perspective. As shown in Table 4.4, more than half of the cities in Los Angeles County use the county government to provide animal control and library and fire services,6 and nearly half use the county to provide police services. Essentially all cities in the county contract with its Public Works Department to provide miscellaneous services. These contracts account for 32 percent of the county’s municipal service expenditures (see Table 4.3). The largest contracts are held by the Public Works, Sheriff’s, and Animal Care and Control Departments. In the case of the Sheriff’s Department and Animal Care and Control, most of these expenditures are directly and completely recaptured as fee revenues from the contracting city or district. A number of state and county statutes require that these services be provided at the county’s operating cost7 and, thus, although these ____________ 6The county’s role in providing library services is somewhat different from the other services listed. In this case, the county is one of several governments that serve on the governing body of the special district that provides library services. In all the other cases in this table, Los Angeles County is the sole governing body over the services provided. 7There is some evidence that the county may incur additional overhead-related costs associated with these services that are not recaptured from the client government. There was a consensus among county officials that these costs are not substantial, and they are not calculated in our study. 60 revenues are technically fully fungible for other purposes, they only offset the costs generated by the provision of the services. In the case of the Public Works Department, there is some contracting activity, but most of the revenues are derived from earmarked property tax revenues through special districts, as discussed above. Over the course of the interviews we conducted for this report, it became clear that the contract city model is a source of contention among cities and among some cities and the county. Because the county is restricted by law to recapturing only its operating costs in contract relationships, it is unable to charge overhead costs to those cities using its services. Larger cities—Los Angeles and Long Beach in particular— argue that their residents, who constitute the largest share of the county’s population, are subsidizing the overhead costs for contract cities through the tax dollars collected from them by the county. Cities operating under the contract city model, they argue, are unable to pay for all the costs of the services they receive, leaving the county to recoup the funds from other places in its budget. On the surface, this argument, which has been around since the onset of the contract city model in the early 1960s, appears valid. However, our analysis of the Sheriff’s Department, which contracts with 41 cities in the county, and the LACFD, which provides fire services to 54 cities in the county via special district membership or contract, found two problems with the argument. First, the LACFD receives property tax revenues from the majority of the cities to which it provides services and is able to cover its overhead costs with these revenues. The LACFD, extremely cognizant of its revenues and expenditures in the postProposition 13 era, reported that it hired a consultant to examine this very issue. The consultant concluded that the department was covering 61 its overhead costs through its relationships with both member and contract cities. Second, the Sheriff’s Department readily admitted that the overhead costs of providing services to contract cities are not covered by the rates it charges to those cities. However, the main concern of the Sheriff’s Department is not overhead costs but economies of scale. Responsible for providing services to numerous unincorporated “island” areas throughout the county, the Sheriff’s Department argues that the contract cities relationship allows it to locate stations closer to these unincorporated areas because of its need to provide services to contract cities in the same vicinity. The department argues that without these contract relationships, it would not be able to provide as quick a response because it simply could not afford to locate a station near certain unincorporated “island” areas. The broader area of coverage that comes with the contract relationship thus allows the department to take fuller advantage of economies of scale. Thus, the argument that contract cities are unable to pay the full costs of the services they receive appears either to be unfounded, as in the case of the LACFD, or to be mitigated by other factors, as in the case of the Sheriff’s Department. Although other city residents in the county may be subsidizing some of the overhead costs of the Sheriff’s Department’s contracting relationships, it is likely that most if not all of these costs would be incurred by the department if it were to try to serve unincorporated areas in the absence of contracts with cities. Thus, it is not surprising that when asked about contract relationships with cities, county officials are quite positive in their response. The City Perspective. In addition to numerous contract relationships between cities and the county and county-governed special districts, cities also contract with independent, private sector 62 organizations. Table 4.5 lists the number of cities in our study sample of 24 cities that contract out for key municipal services, and identifies Table 4.5 Contract Services, by Full-Service and Contract City, 1997–1998 Contract Service General Government Attorney/Legal Services Property Ownership/Maintenance Information Systems Public Safety Police Parking Fire and EMS Animal Care and Control Leisure and Culture Libraries Parks and Recreation Public Works Transportation Traffic Control Street Maintenance Median/Parkway Maintenance Sidewalk Maintenance Tree Maintenance Lighting Engineering Building and Safety Code Enforcement Enterprise Activities Sewer/Sanitation Garbage/Recycling Transit Full-Service Cities 2 (8%) 5 (21%) 1 (4%) — 2 (8%) 1 (4%) 7 (29%) 2 (8%) 1 (4%) 2 (8%) 3 (13%) 2 (8%) 2 (8%) 2 (8%) 4 (17%) — 1 (4%) 3 (13%) 1 (4%) 4 (17%) 4 (17%) 4 (17%) Contract Cities Contracting Agency 8 (33%) 3 (13%) 3 (13%) Independent Independent Independent 8 (33%) 5 (21%) 12 (50 %) 13 (54%) County Mixa LACFD County 10 (42%) 6 (25%) County Library District Independent 5 (21%) 6 (25%) 9 (38%) 7 (29%) 2 (8%) 7 (29%) 4 (17%) 5 (21%) 6 (25%) 6 (25%) Mix Mix Mix Mix Mix Mix Mix Mix Mix Mix 10 (42%) 8 (33%) 8 (33%) Special District Mix Mix NOTE: Based on sample of 24 cities. Table shows the number of cities that contract out, at least in part, for each service listed. Total expenditures on contract services in sample = $505,994,733. For a list of services by city and provider, see Appendix E. aMix = combination of independent contractor and/or county and/or special district. 63 whether the contractor used is the county, a special district, an independent contractor, or a mix of these. As the table shows, the county is the lead contractor in the case of police protection, animal care and control, fire protection, and libraries; independent contractors are predominant in the areas of general government and parks and recreation; and cities use a mix of these contracting agencies to provide public works, garbage and recycling services, and transit. The issue that is inevitably raised when discussing contract cities—as it was in our interviews—is whether contracting out for key services results in discrepancies between full-service and contract cities in sources of revenue and expenditures on services. We examined the differences and similarities between full-service cities and contract cities and found substantive differences between the two types of cities in terms of the revenue sources upon which they rely. However, these differences did not translate into differences in expenditure patterns. We found that contract cities and full-service cities allocate resources in similar ways. Revenue Sources. Striking differences are apparent in comparing the general fund revenues of full-service and contract cities, as shown in Table 4.6. Full-service cities rely heavily on tax revenues from property taxes, utility user taxes, and other taxes, whereas contract cities are less reliant on these taxes and rely more upon sales tax revenues, which account for 28 percent of their general fund revenues.8 Contract cities also receive a higher percentage of their revenues from money and property use (interest income), intergovernmental transfers (primarily from the county and the state, particularly from vehicle license fees), and ____________ 8The sales tax rate for cities is 1 percent, meaning that for every dollar of sales within a city’s boundaries, $.01 is returned to the city. 64 Table 4.6 City General Fund Revenue Sources, 1997–1998 General Fund Category Property taxes Sales taxes Utility users taxes Other taxesa Licenses and permitsb Fines, forfeitures, and penaltiesc Money and property used Intergovernmentale Current service chargesf Other revenues Inter-/intra-fund transfersg Full-Service Cities, % 18 12 17 20 12 3 2 7 1 1 7 Contract Cities, % 10 28 7 13 4 3 9 13 9 2 2 Total, % 17 13 16 19 11 3 3 8 2 1 7 Total 100 100 100 NOTE: For total general fund revenues by city, see Appendix D. aExamples include transient occupant taxes and business license taxes. bExamples include building permits, building plan check fees, emergency ambulance fees, and dog licenses. cExamples include vehicle code fines and parking citations. dRevenue from interest earned on investments, land and facility rental, and parking meter revenue. eRevenue from the county, the state and federal governments, and any other cities or agencies. fExamples include library fines and fees for parks and recreational services. gPrograms funded by revenues other than the general fund often receive services from general fund-supported departments. This category includes reimbursements for those services and transfers to the general fund from special funds. charges for services, which account for 31 percent of their revenues compared to 10 percent for full-service cities. Part of the difference in sources of revenue is explained by the special district relationships outlined above. Contract cities that are members of special districts— 65 such as the LACFD, the County Library District, and the Sanitation Districts of Los Angeles County—do not receive any revenues from the property assessments levied by the special districts. Thus, they must rely more upon other revenue sources, such as sales taxes and service charges. Differences in reliance upon revenue sources between contract and fullservice cities are understandable, given that many contract cities were incorporated under the premise that they would fund their services through non-property tax revenue sources—namely, sales tax revenues (Miller, 1981). Contract cities’ reliance upon sales tax revenues, however, may have some negative implications because these cities have an obvious incentive to favor sales-generating businesses, such as Wal-Mart or auto dealerships when making land use decisions. Although all cities have this incentive, amid reduced reliance on and control over other revenue sources, it is likely that this incentive is stronger among contract cities because of their greater reliance on sales tax revenues as an income stream. Given that most contract cities are smaller, suburban cities, where the competition for retail sales-generating businesses tends to be most intense, the fiscalization of land use would seem hard to avoid. In fact, a recent PPIC survey of local government officials found that the officials gave higher priority to attracting businesses that generate additional sales tax revenues than to alternative land use decisions such as attracting industry or providing housing (Lewis and Barbour, 1999). Thus, the concerns we found in our interviews about the incentives produced by sales tax revenues appear to be well-founded, particularly in the case of contract cities. Expenditure Patterns. In terms of expenditures, full-service and contract cities generally spend money in similar ways. A comparison of 66 how these cities allocate their resources and prioritize services is presented in Table 4.7. The primary differences are that full-service cities spend 20 percent of their total on social services, compared to 12 percent for contract cities, and that contract cities spend 14 percent on planning and development, compared to 8 percent for full-service cities. Similarities in the public service provision of full-service and contract cities point to a key issue raised by several of those interviewed in this study. Despite the differences in sources and control of revenues, the demands and responsibilities for providing services remain largely unchanged. From a historical perspective, local governments in Los Angeles County have faced a similar challenge. Table 4.7 Full-Service and Contract City Expenditures, 1997–1998 Department/Program General Government Public Safety Social Services Culture and Leisure Public Works Planning, Development, and Housing Full-Service Cities, % 18 28 20 7 19 8 Contract Cities, % 18 27 12 9 20 14 Total 100 100 NOTES: These categories provide a summary snapshot of six major areas of municipal service provision. The general government category includes spending for public officials, administration, and internal services. Public safety includes police and fire protection and animal care and control. Social services includes health care and senior and family services. The culture and leisure category includes parks, recreation, and libraries. The public works category includes street maintenance and engineering. Planning, development, and housing includes regional planning and permitting, housing, redevelopment, and economic development. For expenditures by city, see Appendices F and G. Enterprise, capital improvements, and debt service are not included. 67 Some Issues Related to the County’s Role as a Municipal Government Our analysis of services and revenues reveals a nexus between the county, cities, and special districts providing municipal services to the county’s residents. The county plays a significant role as a partner to cities in this process, both through its own departments and through special districts over which it exercises some control. However, this nexus also creates complications, both in terms of institutional arrangements and in the confusion that inevitably accompanies a system in which multiple levels of government provide municipal services. Our fiscal analysis verified a number of the organizational and fiscal problems mentioned in the interviews. 1. The large number of local governments providing services makes it difficult to ascertain which level of government is ultimately responsible for providing which service. The county, 88 cities, and more than 200 special districts simultaneously provide municipal services through numerous institutional arrangements, including county provision to unincorporated areas, special districts, and contracting. For example, it is conceivable that in some cities a resident with a concern about garbage collection could call three different organizations before finally reaching the organization that actually collects the garbage. This might well be the case in a city that contracts with the county for garbage collection, with the county in turn contracting out garbage collection to a private company. Although this system might be efficient from a local government perspective, it is highly complicated from a constituent perspective and understandably breeds confusion, frustration, and even irritability with government. 68 2. The institutional arrangements between the county, cities, and special districts make it difficult for the public to know whom to hold accountable. The complexity that results from multiple levels of local government providing municipal services is reinforced by the complicated flow of revenues and expenditures between local governments. Financing of municipal services in Los Angeles County is accomplished through revenue transfers between cities and the county, between the county and special districts, and between cities and special districts. From a constituent perspective, understanding which services are provided through property taxes and which through special assessments is difficult, and this creates uncertainty about how the taxpayers’ money is being spent and a sense of alienation and distrust because no identifiable accountability is affixed to the expenditures. 3. Eliminating the county’s role as municipal service provider to unincorporated areas through annexation and incorporation is subject to many impediments. One proposal suggested in the interviews for reducing the complexity of municipal service provision is to eliminate the county’s role as a municipal service provider to unincorporated areas through annexation and incorporation. Although this proposal, if feasible, would reduce the county’s role in municipal service provision to that of contractor, perhaps decreasing the complexity of the system, there are many roadblocks to the proposal. Forced annexation and incorporation is a policy no level of government is likely to embrace. Most unincorporated areas remain so because they either are rural or, in the case of urban areas, are not desirable areas of annexation to the surrounding cities. Given the limitations on property tax revenues, most cities are unlikely to annex areas of the county that have low property values or that offer little sales tax revenue. At the same time, the county 69 officials we interviewed did not think that the county’s role as a service provider to unincorporated areas should be eliminated, arguing instead that the level of services provided to those areas is equivalent to the level they would otherwise receive. 4. The “contract city” is an efficient means of providing municipal services at both the county and city levels and offers one model for local governments working closely together to provide local services. Another issue raised by those interviewed was the efficacy of the contract city model, given its prevalence in the county. Although opponents of contract cities argue that residents countywide are subsidizing the overhead costs of providing these services through the county, our analysis indicates that this either is not the case or that there are sufficient other factors, including economies of scale, that justify the service contract. At both the county and contract city level, those we interviewed resoundingly felt that the contract city model resulted in the most efficient allocation of services and was a positive relationship for both sides. 5. Reliance upon sales tax revenues, particularly in the case of contract cities, creates an incentive to prioritize commercial growth and development over housing and other regional needs. One major concern emerging from the interviews was that the sales tax provides cities with an incentive to favor retail over regional economic and housing needs when development decisions are being made by local officials. Our fiscal analysis indicates that such “fiscalization of land use” is likely, given that cities today have little control over a major local revenue stream, that is, the property tax. Contract cities, in particular, are heavily reliant upon sales tax revenues. 70 5. Conclusions: Fiscal and Organizational Alternatives Four major themes emerged from our interviews and were validated by our analysis of the revenue and expenditure data. Translated into goals, they point to what Los Angeles County must do to more effectively provide local services to its residents in the 21st century: (1) gain more fiscal control, (2) expand county partnerships, (3) show greater responsiveness, and (4) increase the county’s regional focus. Clearly, there is recognition that the county has made great strides in recent years, as a combined result of better management and a growing economy. But the consensus is that county government will need to build on these recent accomplishments if it is to effectively meet current service needs and be prepared for the two million more residents who will call Los Angeles County their home in the next 20 years. These four goals for the Los Angeles County government contain some elements that are finance-driven, others that require changes in governmental structure, and yet others that call for better relations with 71 the public. Some elements call for actions at the state level, and others require local change inside county government, between local government entities, or between local governments and the public they serve. We believe that the goals are applicable to counties throughout the state, and especially to large urban counties like Los Angeles County, because county governments in California share a common system of state and local finance. We briefly review below the alternative arrangements that were suggested for achieving these four goals by those participating in our interviews. Although we endorse the goals noted above, we do not endorse any of the specific suggestions mentioned in the interviews for arriving at these goals. Rather, the approaches for reaching these goals will ultimately depend on developing a consensus among state and local government officials, civic leaders, and residents. For this reason, it might even prove counterproductive to offer specific policy recommendations at this time. So, we simply present the goals as a framework and a reason for having a new round of discussions about the role of county government in Los Angeles County and elsewhere in California. More Fiscal Control The fact that county government has little control over its revenues and expenditures is the major finding of both our qualitative and quantitative study of Los Angeles County. The county government is highly dependent on outside sources for its funds and is limited in its abilities to generate its own revenues. Moreover, there is little flexibility on the expenditure side, because county-provided services are often 72 paid for by the state and federal governments through intergovernmental transfers that include specific requirements on how the money is to be spent. The state’s ERAF transfer in the early 1990s, which took back property tax funds that had previously been given to county governments, had the immediate effect of creating a local fiscal crisis and the longer-term effect of reminding county officials how little control they have over their budgets. With the county government so heavily dependent on state government funding, which ebbs and flows with the economy, it is very difficult for county officials to engage in strategic planning about the delivery of county-provided services. “If you talk to the elected officials in county government there doesn’t seem to be any recognition that there needs to be a plan. They are simply focused on how to make it through each year,” remarked one civic leader. Table 5.1 lists some of the ideas proposed in the interviews for increasing the county’s control over its finances and budget. Table 5.1 Suggestions for Increasing Fiscal Control Alternatives Provide a greater share of property tax to local governments Return control of property tax rate and allocation to local governments Distribute growth in sales tax revenues on a per capita or constituency-served basis Distribute greater share of sales tax revenues to counties Earmark a portion of state income tax for discretionary use by the county Use performance-based budgeting Reduce maintenance of effort provisions Switch to a two-thirds majority vote for general taxes and simple majority for specific taxes Change two-thirds majority vote to simple majority for approval of tax measures Expand partnerships with cities and private sector in health care provision Contract and partner with the private sector and nonprofits for assistance in providing public services 73 On the revenue side, alternative arrangements were proposed by both government officials and civic leaders that would increase budget control in county government. The suggestion offered most often, in various forms, is to increase the share of property tax revenues allocated to the county and other local governments. One mechanism for achieving this goal would be to cap the ERAF property tax transfers at current levels so that any growth in property taxes could be returned to the county government. In the 1999–2000 budget deliberations, the governor signed legislation that provided an additional $150 million of fiscal relief to cities and counties—half was based on population and the rest on the amount of property tax shifted away from the cities and counties during the recession. The legislation also included a provision that would place a cap on the growth of the property tax shift if a local finance reform measure was placed on the ballot in 2000.1 Another mechanism would be to return the property tax distribution to where it was before the ERAF transfers occurred in 1992–1993. This would return more than $5.6 billion dollars to Los Angeles County and $1.2 billion to cities in the county. State officials have argued that ERAF funds have in part already been returned to local governments through ____________ 1The governor signed the bill with the following statement of reluctance: “I am concerned about the provisions of this bill that would enact, contingent upon the passage of a constitutional amendment, capping the Education Revenue Augmentation Fund and requiring the state to provide specific property tax administration subventions to counties. Although I concur with the need to address the state-local fiscal relationship, AB 1661 presupposes that capping the ERAF and state assumption of certain property tax administration costs incurred by counties are appropriate solutions to reforming state and local government finance. I believe sustainable state and local government finance reform must be approached more broadly and comprehensively and not be restricted to examination of the property tax only. Furthermore, capping the ERAF value at the 1999–00 level would ignore various measures that have already mitigated the impact of the property tax shift. For some counties, the value of these mitigation measures exceeds the current value of their property tax shifts.” 74 Proposition 172, which provided local governments with funding for police and fire services starting in 1993–1994. A compromise solution would be to return the balance of ERAF transfers, less Proposition 172 funding, resulting in a return of $3.2 billion dollars to Los Angeles County and $960 million to cities in the county. Several other alternatives suggested in the interviews might indirectly increase the budget control of the county, but these suggestions are more relevant to other themes and are discussed below. These include distributing sales tax revenues on a per capita or constituency-served basis as opposed to a situs basis; increasing partnerships with cities, the private sector, and nonprofits to provide health services; and using performancebased budgeting. Distributing sales tax revenues on a per capita or constituency-served basis would increase the sales tax revenues available to the county because of its responsibility for providing a variety of services to the entire region. Increasing partnerships in the provision of health care would help reduce the county’s overburdened Health Services Department and reduce the chances of a recurrence of a fiscal crisis like that experienced earlier in the decade. Expanding these partnerships is, in fact, a requirement of the federal government under the waiver granted to the county (which provides the revenues that have offset the county’s structural deficit in health services). Finally, performance-based budgeting may help the county provide services more efficiently by tying county revenues to specific service objectives. Other suggestions for developing a more stable revenue source for county governments include returning control of the property tax to the counties, increasing the share of sales tax revenues distributed to counties, and distributing a portion of the state income tax to counties. These tax-related alternatives represent a consensus on the part of the 75 local government officials we interviewed that local governments need a stable revenue stream that comes from more than one source. As one city official noted, “The jurisdiction responsible for providing services needs to have the financial wherewithal to provide those services. It can’t just be property tax or sales tax directed. You have to look at everything together.” These alternatives would also strengthen the home rule of the county, as recommended by the California Constitution Revision Commission in 1996. Suggestions for generating new revenues through governance changes include (a) changing the two-thirds majority to a simple majority vote for passing all tax increases, and (b) switching from a simple majority to a two-thirds majority vote for general taxes and a twothirds majority to a simple majority vote for specific taxes. These voterelated recommendations hold advantages for both Los Angeles County and cities in that they would provide local governments with a greater likelihood of increasing revenues through voter-approved tax increases, while not compromising the spirit of Proposition 13—that the voters must approve such increases. Another suggestion was to expand county partnerships with cities, the private sector, and nonprofits in the provision of all social services, much like the efforts already begun. As for increasing fiscal control on the expenditure side, some want the state and federal governments to allow the county to have greater flexibility in deciding which specific programs it provides with state and federal monies. This would help address the problem of funding shortfalls for mandated services. Maintenance of effort provisions represent another area of fiscal constraint for local governments, and as 76 one county official observed, “Eliminating MOEs would free up some room for maneuvering for us.”2 Expanded Partnerships Our interviews tapped into a strong desire for the county government to “reach out” to other organizations, and our budget analysis confirmed the value of expanded partnerships. Many feel that the county government lacks the wherewithal to meet all of the service demands it faces. Indeed, the county’s limited ability to raise new revenues and direct its expenditures to specific services makes this a real concern. It will thus need the increased participation of other service providers. Moreover, some believe that Los Angeles County as a whole is lacking the cooperation that is needed between the public, private, and nonprofit sectors to deliver a wide range of regional and local services in an efficient and effective manner. Our budget analysis of services and expenditures in “contract cities” offered one tangible example of what can be achieved with increased local cooperation. The county government seems to be in an ideal position to foster and facilitate further efforts at expanding partnerships in service delivery. Table 5.2 lists some of the ideas proposed to expand the county’s partnerships with other governments and the private sector. One critical area where expanded partnerships have been proposed is health care. The county government will probably face a large deficit in health care spending whenever the federal bailout ends, which could occur in just a few years. Perhaps other local governments can be called ____________ 2Maintenance of effort provisions are provisions placed upon county government by the state and federal government, requiring the county to maintain a minimum level of service in a given area to maintain eligibility for related funding. 77 Table 5.2 Suggestions for Expanding Partnerships Alternatives Increase contract relationships with cities Expand partnerships with cities and private sector in health care provision Contract and partner with the private sector and nonprofits for assistance in providing public services Prioritize housing needs Provide a forum for interaction with cities and special districts upon in meeting the service needs, either independently or through contracts with the county. “Cities can also be involved in health care if they want. Maybe we need to look at whether it is solely the county’s responsibility,” said a state official. In addition, since the private sector contributes to the problem by not providing health insurance to working families, and private hospitals and clinics are struggling with cost containment, the business and health care communities should be involved in the dialogue about future solutions. Moreover, nonprofit organizations could be a major source for both revenues and service delivery for health care. One example of county partnerships that could be expanded is its relationship with the United Way of Greater Los Angeles, through which health services are provided to an increasing number of county residents. This partnership could be expanded to include other nonprofits, as well as private sector hospitals and clinics. This model could also be applied to other service sectors in the county. Many of those we interviewed thought that the county government could reach out more effectively to the private sector and nonprofit organizations in providing local services. Suggestions ranged from contracting out for services to public-private partnerships to grants from nonprofits to help the county government in its role of caring for the 78 poor and needy. “I don’t think they reach out enough to the private sector,” said one civic leader. Local government was also seen as another important arena for expanded partnerships. Some have proposed that the county government take a more active role in providing a forum for bringing together the service providers in county government, cities, special districts, and the private sector. “In LA there is no structure, and the cities are frustrated,” said a regional official. Some have suggested that the organizing features are already in place. “SCAG [Southern California Association of Governments] has drawn up subregions, and maybe those are the appropriate divisions,” said another civic leader. Expanded partnerships are also needed to help the county, in conjunction with other local governments, deal with unmet housing needs and economic development issues. Greater Responsiveness We often heard in our interviews that local government is remote and unresponsive to the public it serves. County government is a huge bureaucracy, as demonstrated by our budget analysis and the data we present in the appendices of this report. The sheer size and complexity of the county government could foster a belief that it is detached from the communities and people it serves. The large number of cities and special districts that provide all of the local services we identified in our budget analysis could add to the public’s frustration and confusion about who is accountable for what. “The feeling of the general populace is that the government is wasteful and inefficient, and that is why voters are reluctant to give government additional money to provide the services they demand,” said an elected county official. In Los Angeles County, it is a great challenge for local governments to be up close and personal 79 with a population of 10 million residents, especially given the highly diverse racial and ethnic mix that has resulted from immigration over the last 20 years. In addition to the duties inherent in public service, it is a political necessity to convince voters that local governments are responsive to their needs and perform worthwhile activities. Since the passage of Proposition 13, the voters have decided which government reforms to support and which to reject; and for the past 20 years, voters have opted to limit taxing and spending authority. Some of the current proposals for change, such as increasing revenue options and allowing more flexibility in spending, will require a public that believes local governments are responsive and local officials can be held accountable. Table 5.3 lists some of the suggestions offered for ways to improve the county’s responsiveness to its many constituencies. We received many suggestions for increasing the responsiveness of county government. A more transparent budget process was proposed, Table 5.3 Suggestions for Improving Responsiveness Alternatives Make budget process more transparent Use performance-based budgeting Eliminate county’s role as municipal service provider to unincorporated areas and establish a municipal services district to serve these areas Increase the number of county supervisors Elect a county mayor or CEO Monitor citizen satisfaction using public opinion surveys Expand number of locally based offices Increase interaction with media Reach out to Latino community and media Increase use of Internet services 80 so that people might have a better idea of where their money goes and could participate in budget decisions. The use of performance-based budgeting was seen as another step toward increasing the public’s perception of greater responsiveness on the part of county government, through implementing a process that would set clear and public expectations for the most efficient allocation of existing funding and a system of accountability. Monitoring citizen use of local services and their satisfaction with those services through large-scale public opinion surveys would provide a feedback mechanism for county bureaucracies and increase the public perception that the government cares about how the people rate their services. A PPIC Statewide Survey in April 1998 found some evidence that supports the importance of such communication between public officials and their constituents. Only 10 percent of Los Angeles County residents named county government as the level of government they trusted the most to solve problems that concerned them. Forty percent had little or no confidence in the ability of their county board of supervisors when it comes to handling county problems. In both survey items, Los Angeles County residents expressed more dissatisfaction than other state residents with their county officials (Baldassare, 1998b). Clearly, this issue and many others should be fully explored by fielding public opinion surveys throughout the county. Using the Sheriff’s Department as a model, the county government could also expand its locally based offices, which would help reduce the perception of the county as a remote and isolated bureaucracy. “The dilemma of LA County is that it doesn’t have the capacity to develop community-based networks to provide services,” said a regional official. “The challenge is to make government occur in a township fashion,” 81 observed an elected county official. Others have proposed that the county expand its public relations efforts to improve its image, through paid advertisements and more media coverage. “This would be a perfect time for the county [government] to work on its image and make what they do more understandable to the public,” said one civic leader. Outreach with the Latino community was cited as one particular area where media relations needs to be improved. Many of the users of county health and welfare services are Latino and many of the problems associated with the delivery of these local services stem from a lack of communication between the county and this rapidly growing constituency. Some propose that the county officials keep Latino print, radio, and broadcast media in the county more fully informed. Others suggested expanding communication through the Internet. Providing electronic information about services and service delivery (such as recordkeeping) would literally bring county services closer to residents. We believe that all of the proposed efforts would increase the responsiveness and accountability of county services and begin to break down voter distrust in government. Some have also suggested changes in governance structures to help improve the county’s responsiveness. For example, there is currently only one county supervisor per approximately two million residents in Los Angeles County. Some of those we interviewed suggested that having more supervisors would bring county government closer to its constituents by making each supervisorial district smaller. Others wanted to add the countywide offices of an elected mayor or an elected CEO. Increasing county government responsiveness is also inherently tied to increased fiscal control. As noted above, one of the most difficult tasks for the county is to meet the growing demand for services while 82 lacking control over the revenues that finance those services. Thus, returning control of the property tax to county and other local governments, providing a greater share of sales tax revenues or a share of the state income tax to the county, and reducing the two-thirds vote requirement for tax measures would provide the county with substantially more revenues that could then be devoted to meeting service demands. The disconnect between revenues and services therefore underscores many of the other challenges facing the county. As one county official noted, “We are handicapped by dysfunctional funding of local government. Financing is the foundation of local government’s problems.” A final suggestion for improving county responsiveness, as mentioned in the discussion of expanded partnerships, was that the county help establish a forum for interaction with cities and special districts that would seek to better define the roles of each sector of government and deal with regional issues, such as the need for additional housing. Increased Regional Focus Many expressed concern that county government is too involved in delivering local services that are typically reserved for city governments and special districts. They believed that the county government should assume more of a regional role, focusing on local services that need to be delivered throughout the entire county. Two reasons for increasing the county’s regional focus were given in the interviews and were confirmed by our budget analyses. The first is that the county should concentrate its limited resources on regional-level services. Clearly, we saw significant dollars and organizational efforts associated with the county’s role in providing municipal-level services. If 83 the provision of municipal-level services were left to cities and special districts, the county could devote itself to its regional role as an agency of the state and federal governments and as a regional service provider. The second reason for increasing the county’s regional focus us that there is a need for some government entity to look at “big picture” issues— housing, economic development, the natural environment, and quality of life in the region as a whole. At a minimum, this requires balancing the needs and demands for additional housing against the effect that such development may have on the region’s open spaces and wilderness areas. Growth management measures, such as those instituted in Santa Clara and Ventura Counties, and appearing on the ballot in other coastal regions, are examples of one option for the county to pursue. Of the current forms of local government, county government is in the best position to assume this leadership role. The need for a regional focus is especially important in Los Angeles County, given the population growth that is expected, the competition for jobs and industry with other regions such as New York and the Silicon Valley, and the increasing role the county plays in the global marketplace. Some of the alternatives proposed for increasing the county’s regional focus are listed in Table 5.4. A recurrent suggestion was that the county get out of the business of providing municipal-level services in the unincorporated areas. One way to accomplish this would be to encourage the annexation and incorporation of unincorporated communities. However, as many of those interviewed acknowledged, forced annexation and incorporation are difficult and unlikely prospects. A more viable alternative, as discussed above, would be to establish a municipal services district that would provide municipal services to 84 Table 5.4 Suggestions for Increasing the County’s Regional Focus Alternatives Distribute growth in sales tax revenues on a per capita or constituency-served basis Encourage unincorporated areas to incorporate or be annexed Eliminate the county’s role as municipal service provider to unincorporated areas, establishing a municipal services district to serve unincorporated areas Increase contract relationships with cities Consolidate or dissolve dependent special districts Prioritize housing needs Provide a forum for interaction with cities and special districts Expand number of locally based offices unincorporated areas. Such a district might be funded by a special assessment (or by existing property taxes) on property in these areas. One significant advantage of a municipal services district for unincorporated areas is that it would improve local government responsiveness in unincorporated areas by having one agency responsible for providing services, rather than having a county government that must balance services between these areas and the better-represented cities in the county. Currently, county supervisors charged with representing more than nine million residents countywide make municipal service decisions for the 900,000 people living in the unincorporated areas. Implementing this alternative in the unincorporated areas, however, would involve significant problems that should be carefully considered. For example, this new level of government, while certainly providing much more direct accountability and responsiveness to local needs, would also face the challenge of adequately representing and addressing the concerns and interests of an extremely diverse constituency. It would be difficult to simultaneously address the needs of the unincorporated areas in the San Pedro and Wilmington areas, those of Pepperdine University on the coast, and those of the high desert surrounding 85 Lancaster and Palmdale. One solution would be to have more than one such municipal services district, but that would exacerbate the other problem that such an approach would involve—namely, the loss of efficiencies resulting from scale and scope. Establishing such a district would also introduce new administrative costs and overhead—an effect currently mitigated by the scale of the overall Los Angeles County municipal service enterprise. To fund these activities, an argumentative political dialogue over the reallocation of the property tax would have to occur. Overall, a municipal services district for unincorporated areas would represent a tradeoff between local representation and government complexity. The obstacles to incorporation, annexation, and a municipal services district demonstrate that although there is a consensus for eliminating the county’s municipal service role in unincorporated areas, it is an objective difficult to achieve. Other suggestions for increasing the county’s regional focus included taking the “contract cities” approach to a new level by negotiating police, fire, and library service agreements with more noncontract cities in the region, which would take further advantage of regional economies of scale. Expanding the number of locally based county offices would also make the county’s role as a regional service provider more visible, particularly to smaller or outlying cities and areas in the county. “The greatest deficiency that we face in Southern California is that we have very few community-based governance structures, so we have few community-based service delivery systems,” noted one civic leader. Other suggestions for increasing the county’s regional focus call for changes in large single-purpose special districts, both independent and dependent. Some argue that regional single-purpose districts, like the Sanitation Districts of Los Angeles County and the LACFD, could be 86 consolidated into the county as general services. From a regional perspective, the advantage of this alternative is that it would allow revenue and resource allocation decisions to be made by one governmental entity, allowing the county to balance resources and to set priorities among competing demands for services. Under the current system, it is argued, certain services are overfunded, such as sanitation and fire services, but health and welfare services are underfunded. Others argue that the independent single-purpose districts are good examples of regional service-provision already occurring through the cooperation of cities and counties. Thus, the county might be better served by providing more services based upon the independent special district model. One suggestion was to change the governance structure of county dependent special districts, such as the LACFD and the County Library District so that their member cities and agencies have a vote in the policy directions pursued by these districts. This alternative could make these districts more responsive to local needs and could enhance their status as regional service providers. It was also suggested that the county disengage itself from dependent districts altogether, allowing them to operate as independent special districts. Regardless of the direction pursued with respect to dependent special districts—consolidating them into county general services or disengaging them from county control—the end result would be the same: elimination of the county’s role as overseer of dependent districts, a role that some argue creates confusion and contributes to the fragmentation of local government in Southern California. Finally, some suggested that to reinforce its regional focus, the county government should add regional housing needs and regional economic redevelopment to the list of its county programs and services. 87 These new efforts would require cooperative ventures with local governments, the private sector, and nonprofits and the creation of a forum where the various actors influencing regional service delivery could interact, as discussed in previous chapters. Regional cooperation, it was argued, has to start among the various local governments and nongovernmental agencies, for which there is currently little incentive. As one civic leader observed, “There is a lack of a strategic game plan for coordinating services between the county and other jurisdictions. There is no master plan in the county for how to accomplish it either. If there is one thing that the county needs to do institutionally, it is to come up with a master plan for dealing with interjurisdictional and regional issues.” In sum, a wide variety of alternative fiscal and organizational arrangements were suggested by those we interviewed, and our budget analyses offer compelling reasons for seriously considering these proposals. As noted by one county official, a more cooperative environment exists among local governments today than in the darker economic days of the early 1990s: “Today, cities and counties are working together to get the property tax money back from the state.” Local governments that were for many years in contentious and adversarial relations have rallied around the state and local finance issues that affect them all. The next task is to have a serious dialogue between the state and local governments about how to improve county government’s ability to finance and provide services. Today’s healthy economy offers the best opportunity to move ahead with ideas for achieving more fiscal control, expanded partnerships, greater responsiveness, and an increased regional focus. If not now, when? 88 Appendix A Departments in Los Angeles County Administrative Office, Chief Affirmative Action Agricultural Commissioner/Weights and Measures Alternate Public Defender Animal Care and Control Assessor Auditor-Controller Beaches and Harbors Board of Supervisors Chief Information Office Children and Family Services Community and Senior Services Consumer Affairs Coroner County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Military and Veterans Affairs Museum of Art Museum of Natural History Music and Performing Arts Commission Office of Ombudsman Parks and Recreation Probation Public Defender Public Library Public Social Services Public Works Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector 89 Appendix B Los Angeles County Departmental Expenditures, by Role, 1997–1998 91 Table B.1 Los Angeles County Departmental Expenditures, by Role, 1997–1998 92 Department Administrative Office, Chief Affirmative Action Agricultural Commissioner/ Weights and Measures Alternate Public Defender Animal Care and Control Arts Commission Assessor Auditor-Controller Beaches and Harbors Board of Supervisors Chief Information Office Children and Family Services Community and Senior Services Community Development Commission Consumer Affairs Coroner County Counsel Dependent Special Districts District Attorney Enterprise Funds Regional Government 24,971,028 654,090 6,800,909 18,125,012 1,337,910 1,522,104 89,886,664 29,970,314 10,384,633 34,042,069 1,526,888 37,039,405 10,493,768 114,752,300 1,430,851 13,250,162 31,144,386 272,179,365 189,859,127 Agent of State and Federal Governments Federal State Combined 695,604 421,606 633,793 7,571,697 157,026 1,063,311 2,400,940 175,144,100 948,178,703 8,699,027 77,209,126 722,801 Municipal Service Provider Dependent Municipal Contract District 3,520,000 380,000 5,220,000 5,570,862 1,381,000 605,000 58,860,710 2,162,569 29,175,307 99,850 574,829,431 Total 24,971,028 2,405,094 14,752,606 18,125,012 11,141,221 1,679,130 89,886,664 32,371,254 15,955,495 34,042,069 1,526,888 985,218,108 98,387,921 289,896,400 2,153,652 13,250,162 33,306,955 604,004,738 272,279,215 248,719,837 Table B.1 (continued) 93 Regional Department Government Fire Department—Lifeguards 6,617,000 Grand Jury 485,830 Health Services 2,899,867,133 Human Relations Commission 1,055,710 Human Resources 17,039,687 Information Systems Advisory Body 13,701,959 Internal Services 221,977,223 Local Agency Formation Commission 273,430 Mental Health Military and Veterans Affairs 666,072 Museum of Art 15,739,166 Museum of Natural History 13,667,305 Music Center Operations 7,572,983 Office of the Ombudsman 259,046 Parks and Recreation 41,160,906 Probation 25,302,753 Probation—Community- Based Contracts Public Defender 81,646,066 Public Library Public Social Services Agent of State and Federal Governments Federal State Combined Municipal Service Provider Dependent Municipal Contract District 2,334,000 84,930,000 52,309,000 457,051,282 480,739 145,562 175,504 3,373,732 30,381 278,222,286 24,197,994 1,480,602 2,414,088 405,453,814 58,168,303 2,080,460 Total 6,617,000 485,830 3,039,440,133 1,055,710 17,039,687 13,877,463 225,350,955 303,811 457,051,282 1,146,811 15,884,728 13,667,305 7,572,983 259,046 65,358,900 305,605,499 1,480,602 84,060,154 58,168,303 2,405,453,814 Table B.1 (continued) 94 Department Public Works Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Trial Court Operations— Municipal Courts Trial Court Operations— Superior Court Regional Government 40,613,355 40,488,058 919,821,190 43,570,315 Agent of State and Federal Governments Federal State Combined Municipal Service Provider Dependent Municipal Contract District 209,567,949 287,876,423 7,193,819 1,722 9,668,037 18,381,058 85,165,673 3,281,965 138,972,098 1,642,094 309,706,532 272,229,945 Total 538,057,728 7,195,541 53,438,060 1,162,340,019 45,212,409 309,706,532 272,229,945 Total 5,280,896,171 187,998,767 2,393,954,619 2,535,751,296 453,626,310 475,077,105 574,829,431 11,902,133,699 Appendix C Los Angeles County Departmental Revenues, 1997–1998 Table C.1 Los Angeles County Departmental Revenues from Taxes, Service Charges, and Fees, 1997–1998 Department Property Tax Administrative Office, Chief Affirmative Action Agricultural Commissioner/ Weights and Measures Agricultural Commissioner— Vehicle Accumulative Capital Outlay (ACO) Fund Air Quality Improvement Fund Alternate Public Defender Animal Care and Control Arts Commission Assessor Sales Tax Other Taxes 400 1,778,299 400 Service Charges and Fees 3,924,672 814,962 7,182,193 52,819 7,019 9,545,350 28,041,951 95 Table C.1 (continued) Department Asset Development Implementation Fund Auditor-Controller Beaches-Harbors Board of Supervisors Cable TV Franchise Capital Projects/Refurbishments Child Abuse/Neglect Prevention Program Children and Family Services Civic Center Employee Parking Community and Senior Services Community-Based Contracts Consumer Affairs Coroner County Counsel Courthouse Construction Criminal Justice Facility Temporary Construction Del Valle ACO Dependency Court Facilities Dependent Special Districts Detention Facilities Debt Service Fund Dispute Resolution Fund District Attorney District Attorney Asset Forfeiture District Attorney Drug Abuse/Gang Diversion Domestic Violence Program Emergency Preparedness and Response Energy Management Extraordinary Maintenance Federal and State Aid Property Tax Sales Tax Other Taxes 227,975 2,000 12,321,447 8,463,776 Service Charges and Fees 11,285,965 6,950,144 2,168,839 1,290,577 38,742 547,214 13 1,613 1,261,478 1,475,109 11,415,047 1,163 33,503,772 3,443,418 2,969,076 1,414,552 13,500 (1) 100,000 572,013 96 Table C.1 (continued) Department Property Tax Fire Department—Helicopter Replacement ACO Fire Department Developer Fee 1,467,478 Fire District 326,134,266 Fish and Game Propagation Ford Theater Development General Fund—Financing Elements 1,201,330,606 Golf Course Grand Jury Hazardous Waste Health Services—General Health Services—Enterprise Hospitals Human Relations Commission Human Resources 2,846,236 Information Systems Advisory Body (ISAB) Internal Services ISAB Marketing Judgments and Damages/Insurance Jury Operations Improvement LA Community Development Corporation 4,092,000 LAFCO Landscape Maintenance District and Landscape and Light- ing Assessment District (LLAD) 5,142,350 Linkages Support Program Marina Del Rey Debt Service Fund Marina Replacement ACO Marketing Program Mediation Services Dependency Court Mental Health Military and Veterans Affairs Sales Tax Other Taxes 77,314 800 11,000 Service Charges and Fees (2,869) 47,928,562 341,989 183,857,078 225,572,262 7,434,233 59,479,175 417,500 165,951 312,247 802,285 1,199,990 30,197,359 67,992 97 Table C.1 (continued) Department Property Tax Sales Tax Other Taxes Miscellaneous Enterprise Funds 10,909,333 Motor Vehicles ACO Municipal Court Automation Museum of Art Museum of Natural History Music Center Operations Non-Departmental Revenue Summary 2,702,418 34,825,862 67,356,869 Non-Departmental Special Accounts Oak Forest Mitigation Off-Highway Vehicles Office of Public Safety Park In-Lieu Fees—ACO Parks and Recreation 322,471 Probation Productivity Investment Public Defender Public Library 38,152,794 400 Public Social Services Public Works Public Works—Article 3 Bikeway Public Works—Aviation Capital Project Public Works—Facility Project Management Public Works—Flood Control District 163,265,073 Public Works—Flood Control/Debt Services 9,465,000 Public Works—Garbage Disposal District Summary 2,284,811 Public Works—Off Street Meter and Preferential Parking Districts Public Works—Other Special Districts Summary 55,783 54,000 Service Charges and Fees 554,894 73,482 1,202,064 2,064,462 87,615,448 51,435 8,794,174 28,316,390 14,708,502 262,630 2,276,851 4,925,508 31,913,411 5,739,615 5,125,415 8,840,295 2,310 4,060,243 98 Table C.1 (continued) Department Property Tax Sales Tax Other Taxes Public Works—Pre-County Improvement District Studies Public Works—Proposition C Local Return 9,048,149 Public Works—Road Fund 117 2,725,451 Public Works—Sewer Maintenance Districts Summary 1,573,468 Public Works—Solid Waste Management Public Works—Special Road Projects 2,805,542 Public Works—Street Light District/LLAD Summary 14,019,820 Recreation and Parks and LLAD Summary 219,296 Recreation Fund Regional Park and Open Space District Summary 76,007,654 Regional Planning Registrar-Recorder/County Clerk 400 Rent Expense San Gabriel Canyon Recreation Sheriff 29,500 Sheriff—Automated Fingerprint Identification Sheriff—Automated Fund Sheriff—Countywide Warrant System Sheriff—Inmate Welfare Sheriff—Jail Store Sheriff—Narcotic Enforcement Sheriff—Processing Fee Sheriff—Special Training 6,010 Sheriff—Vehicle Theft Prevention Fund Small Claims Advisor Program Service Charges and Fees 20,462 225,527 20,044,556 17,949,285 11,945,094 107,680 104 2,630,735 36,457,427 243,823,925 1,262,578 965,968 655,196 1,134,961 99 Table C.1 (continued) Department Property Tax Special Development Funds— Regional Parks Telephone Utilities Treasurer and Tax Collector 429 Trial Court Operations Trial Court Operations Fund Utilities Sales Tax Other Taxes 1,456,435 3,500 3,400 Service Charges and Fees 340,083 17,923,509 27,573,512 17,506,121 115,681 Total 1,872,350,364 57,562,795 71,277,173 1,293,004,47 100 Table C.2 Los Angeles County Departmental Revenues from Other Sources, 1997–1998 Inter- governmental Department Revenues Administrative Office, Chief 1,544 Affirmative Action 176,284 Agricultural Commissioner/ Weights and Measures 3,127,372 Agricultural Commissioner— Vehicle ACO Fund Air Quality Improvement Fund Alternate Public Defender Animal Care and Control Arts Commission 215,000 Assessor 14,864,740 Asset Development Implementation Fund Auditor-Controller Beaches-Harbors 587,913 Board of Supervisors 717,058 Cable TV Franchise Capital Projects/ Refurbishments 5,326,629 Child Abuse/Neglect Prevention Program Children and Family Services 897,973,795 Civic Center Employee Parking Community and Senior Services 82,850,616 Community-Based Contracts 812,000 Consumer Affairs 386 Coroner 144,395 County Counsel 33,623 Courthouse Construction Criminal Justice Facility Temporary Construction Del Valle ACO 350,000 Dependency Court Facilities Other Revenues 2,602,976 55,955 613,751 1,090,718 98,817 202,493 107,350 2,292,855 1,265,000 459,523 2,530,688 1,489,638 77,876 8,338,016 2,601,378 1,854,108 4,309,475 172,998 176,246 110,076 263,423 34,665,395 22,908,436 4,725 183,937 Debt Proceeds Department Total 6,529,592 1,047,201 12,701,615 52,819 1,090,718 105,836 9,748,243 322,350 45,199,546 1,265,000 11,745,488 10,296,720 4,377,535 1,368,453 13,664,645 2,640,120 900,375,117 4,309,488 83,025,227 812,000 1,438,110 1,729,580 11,712,093 34,665,395 22,908,436 355,888 183,937 101 Table C.2 (continuted) Inter- governmental Department Revenues Dependent Special Districts Detention Facilities Debt Service Fund 129,664 Dispute Resolution Fund District Attorney 182,012,790 District Attorney Asset Forfeiture 186,373 District Attorney Drug Abuse/Gang Diversion Domestic Violence Program Emergency Preparedness and Response 136,448 Energy Management Extraordinary Maintenance Federal and State Aid 8,812,302 Fire Department— Helicopter Replacement ACO Fire Department Developer Fee Fire District 16,553,049 Fish and Game Propagation Ford Theater Development General Fund—Financing Elements Golf Course Grand Jury Hazardous Waste Health Services—General 330,430,740 Health Services— Enterprise Hospitals 1,807,133,080 Human Relations Commission 24,000 Human Resources 255,508 Information Systems Advisory Body 263,480 Other Revenues 11,084,041 517,374 95,387 8,358,081 1,021,398 4,978 246,143 877,274 97,598 4,400,618 28,274 174,333 20,119,769 30,188 198,720 2,784,532 18,959 81,057 6,808,175 416,488 86,116 134,510 2,948,901 Debt Proceeds Department Total 56,909,260 9,110,814 3,538,805 193,339,947 1,207,771 4,978 1,660,695 149,948 877,273 197,598 13,784,933 28,274 1,638,942 410,812,960 30,188 540,709 1,201,330,606 2,784,532 18,959 81,057 521,095,993 2,033,121,830 110,116 10,670,487 3,212,381 102 Table C.2 (continuted) Inter- governmental Other Department Revenues Revenues Internal Services 130,485 2,819,317 ISAB Marketing 224,241 Judgments and Damages/ Insurance 120 Jury Operations Improvement 1,106 LA Community De- velopment Corporation 252,005,200 29,437,400 LAFCO 1,709 Landscape Maintenance District and LLAD 7,882 609,989 Linkages Support Program 429,067 Marina Del Rey Debt Service Fund 26,630,354 Marina Replacement ACO 432,308 135,076 Marketing Program 90,070 Mediation Services Dependency Court 123,794 Mental Health 355,953,400 2,541,313 Military and Veterans Affairs 217,953 164,093 Miscellaneous Enterprise Funds 5,436,695 Motor Vehicles ACO 9,550 Municipal Court Automation 1,395,426 Museum of Art 122,400 Museum of Natural History 2,535,419 Music Center Operations 3,881,802 Non-Departmental Revenue Summary 829,517,343 80,126,018 Non-Departmental Special Accounts 157,173,875 Oak Forest Mitigation 98,573 Off-Highway Vehicle 122,541 2,881 Office of Public Safety 3,580 46,062 Park In-Lieu Fees—ACO 1,400,575 Parks and Recreation 1,926,193 4,816,411 Probation 101,940,105 2,697,572 Debt Proceeds Department Total 62,429,777 224,241 120 1,106 285,952,100 167,660 5,760,221 741,314 27,432,639 567,384 90,070 1,323,784 388,692,072 461,038 16,900,922 83,032 1,395,426 1,324,464 4,599,881 3,881,802 1,102,143,958 157,225,310 98,573 125,422 8,843,816 1,400,575 35,381,465 119,346,179 103 Table C.2 (continuted) Inter- governmental Department Revenues Productivity Investment Public Defender 1,110,958 Public Library 4,399,178 Public Social Services 1,998,743,108 Public Works 759,350 Public Works—Article 3 Bikeway 218,006 Public Works—Aviation Capital Project 3,150,958 Public Works—Facility Project Management Public Works—Flood Control District 4,787,815 Public Works—Flood Control/Debt Services Summary Public Works—Garbage Disposal District Summary 39,220 Public Works—Off Street Meter and Preferential Parking Districts Public Works—Other Special Districts Summary Public Works—Pre- County Improvement District Studies Public Works—Proposition C Local Return 74,477 Public Works—Road Fund 134,826,044 Public Works—Sewer Maintenance Districts Summary 33,596 Public Works—Solid Waste Management 709,126 Public Works—Special Road Projects 50,612 Public Works—Street Light District/LLAD Summary 182,679 Other Revenues 574,278 373,085 2,654,394 5,592,492 1,440,779 610,640 222,190 20,502,821 460,000 1,065,521 126,669 784,006 3,285,946 11,103,852 984,654 909,665 118,337 2,418,888 Debt Proceeds 192,833 Department Total 574,278 1,746,673 47,483,617 2,009,261,108 34,113,540 828,646 3,150,958 5,961,805 193,681,124 9,925,000 12,229,847 128,979 4,954,032 20,462 12,634,099 168,700,020 20,733,836 13,563,885 2,974,491 16,729,067 104 Table C.2 (continuted) Inter- governmental Department Revenues Recreation and Parks and LLAD Summary 1,688 Recreation Fund Regional Park and Open Space District Summary 3,039 Regional Planning 359,074 Registar-Recorder/County Clerk 2,362,984 Rent Expense San Gabriel Canyon Recreation Sheriff 390,572,516 Sheriff—Automated Fingerprint Identification Sheriff—Automated Fund Sheriff—Countywide Warrant System Sheriff—Inmate Welfare Sheriff—Jail Store Sheriff—Narcotic Enforcement Sheriff—Processing Fee Sheriff—Special Training Sheriff—Vehicle Theft Prevention Fund 6,140,949 Small Claims Advisor Program Special Development Funds—Regional Parks Telephone Utilities Treasurer and Tax Collector 58,243 Trial Court Operations 2,634,884 Trial Court Operations Fund 71,328,964 Utilities Other Revenues Debt Proceeds 60,529 1,072,029 16,406,711 510,185,000 1,528,511 1,016,667 1,104,394 185,105 21,719,990 3,874,507 70,915 586,854 35,339,875 4,117,623 6,433,198 100,251 249,213 22,122 696,755 640,300 8,512,653 95,440,860 14,154,238 3,975,782 Department Total 281,513 1,072,133 602,602,404 4,518,320 39,837,478 1,104,394 185,105 656,145,931 3,874,507 1,333,493 586,854 35,339,875 4,117,623 6,433,198 1,066,219 661,206 6,390,162 1,157,083 696,755 980,383 27,951,269 125,652,756 102,992,723 4,091,463 Total 7,517,923,247 742,496,974 510,377,833 12,064,992,873 105 Appendix D Sample City Revenues, 1997–1998 107 Table D.1 Sample City Revenues, 1997–1998 Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/ Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Bell Gardens 435,000 1,325,000 7,975,000 140,600 125,100 2,726,840 4,062,255 173,815 381,500 Beverly Hills Bradbury 16,988,321 107,500 15,630,322 2,000 36,403,660 5,519,757 37,500 43,500 5,169,727 4,447,816 55,000 4,516,602 6,698,560 19,000 151,600 10,200 4,500 Cerritos 1,400,000 21,000,000 1,882,000 803,500 306,000 14,824,000 7,256,060 8,733,740 207,330 Total General Fund 17,345,110 95,374,765 430,800 56,412,630 Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 4,070,862 1,360,000 1,465,000 923,070 46,600 16,999,576 40,473,186 28,345,495 56,106 3,661,360 2,260,000 8,075,500 5,000 Total Other Funds 7,865,532 85,818,257 56,106 14,001,860 Grand Total 25,210,642 181,193,022 486,906 70,414,490 108 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/ Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Compton Gardena Glendale Hawthorne 3,090,036 12,128,000 6,121,985 11,000,000 2,362,025 7,258,088 20,913,000 168,800 3,023,000 2,590,000 7,420,000 3,900,000 3,733,000 556,300 205,000 1,000,000 1,406,400 73,000 5,795,000 208,658 2,800,031 1,638,672 100,300 8,972,000 2,474,000 6,299,000 2,578,450 1,682,000 4,338,401 25,039,000 Total General Fund Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 0 28,156,338 90,344,000 30,373,808 16,917,615 34,782,067 4,149,043 12,771,000 483,000 192,948,800 2,753,222 7,007,960 1,785,000 20,375,000 461,145 8,899,732 25,499,760 2,817,163 10,037,278 5,376,616 2,228,469 Total Other Funds 0 26,549,025 276,784,559 45,959,286 Grand Total 0 54,705,363 367,128,559 76,333,094 109 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Inglewood Irwindale Lakewood Long Beach 8,260,000 6,905,000 13,230,900 14,689,060 383,000 159,739 2,650,000 1,959,414 1,419,459 920,061 2,036,920 7,485,000 1,850,000 1,150,792 332,400 45,600,000 30,900,000 56,300,000 23,900,000 10,700,000 4,440,500 114,236 272,000 8,500,000 387,300 456,681 1,592,000 12,000,000 5,093,500 2,410,400 6,660,600 5,001 273,375 1,047,180 3,611,557 4,845,600 543,600 32,200,000 10,500,000 79,400,000 Total General Fund Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 62,460,260 9,005,146 23,719,869 310,085,701 110,156,160 18,112,536 14,395,000 16,013,239 8,633,831 1,360,110 5,423,400 189,292,303 189,588,623 253,944,841 605,847,587 Total Other Funds 140,564,399 18,112,536 15,417,341 1,238,673,354 Grand Total 203,024,659 27,117,682 39,137,210 1,548,759,055 110 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Los Angeles 499,204,000 309,140,000 477,625,000 567,836,000 386,735,000 89,000,000 30,447,000 197,853,000 138,566,211 Manhattan Malibu Beach 2,158,868 1,500,000 1,810,000 1,132,000 150,000 5,832,636 6,300,000 4,100,000 1,143,300 301,500 1,242,500 263,000 2,637,532 2,530,000 2,399,200 12,000 1,766,390 2,517,960 1,556,784 Monterey Park 4,001,000 3,400,000 2,600,000 4,003,000 1,266,000 710,000 1,276,200 3,617,421 426,000 Total General Fund 2,696,406,211 12,256,568 27,097,102 21,299,621 Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 1,311,113,668 62,371,922 2,536,425 3,164,300 3,421,422 12,529,990 70,620 35,000 51,590 15,504,648 3,457,000 5,900,000 2,681,348 1,239,379 874,820 Total Other Funds 1,373,485,590 2,536,425 19,272,922 29,657,195 Grand Total 4,069,891,801 14,792,993 46,370,024 50,956,816 111 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Pasadena Pomona Rosemead Santa Clarita 18,796,104 8,409,900 22,844,000 12,145,224 18,816,000 12,250,000 15,167,595 3,370,300 703,400 3,205,904 1,020,000 2,575,000 1,580,600 781,200 4,950,000 15,500,000 4,244,135 2,069,230 3,147,500 793,200 297,500 4,535,153 833,735 451,200 6,955,176 4,864,649 1,985,135 6,285,163 2,458,188 2,263,256 2,547,000 178,000 41,700 158,000 1,112,575 6,271,450 3,597,035 855,703 19,814,599 2,224,855 1,097,300 Total General Fund Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 117,629,311 54,239,725 10,569,500 38,758,128 76,517,758 37,593,282 190,715,158 24,494,081 8,207,300 24,014,161 54,029,214 8,932,903 6,698,088 35,904,903 Total Other Funds 304,826,198 119,677,659 6,698,088 35,904,903 Grand Total 422,455,509 173,917,384 17,267,588 74,663,031 112 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Santa Monica Signal Hill Walnut West Hollywood 18,788,538 22,409,000 24,855,000 24,143,879 26,257,135 270,600 7,950,000 943,900 340,000 750,000 1,050,000 635,000 257,600 4,769,000 6,630,000 9,174,680 1,659,555 7,985,000 9,747,836 228,300 8,539,226 9,007,586 94,500 12,000 6,025,923 231,000 1,056,920 2,669,356 400,450 651,800 8,700 1,550,420 84,700 426,170 2,359,347 2,344,375 246,000 369,750 Total General Fund 151,961,500 11,260,700 5,822,810 35,878,236 Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 82,255,757 16,105,828 55,984,197 2,372,998 3,082,200 4,337,890 8,877,207 2,421,900 861,100 4,999,075 Total Other Funds 154,345,782 8,738,198 4,337,890 13,876,282 Grand Total 306,307,282 19,998,898 10,160,700 49,754,518 113 Table D.1 (continued) Revenue Source General Fund Property Taxes Sales Taxes Utility Users Taxes Other Taxes Licenses and Permits Fines, Forfeitures, and Penalties Revenue from Money and Property Use Revenue from Other Agencies/Intergovernmental Current Service Charges Other Revenue Inter-/Intra-Fund Charges and Tranfers Sample Total 661,746,162 521,882,531 617,558,339 755,692,648 447,159,242 131,306,586 97,827,802 299,065,100 69,548,808 34,160,304 270,854,616 Total General Fund Other Funds Special Revenue Internal Service Enterprise Debt Service Capital Improvement Miscellaneous/Other 3,906,802,138 1,984,960,323 298,730,347 819,366,711 151,769,141 66,291,216 622,041,649 Total Other Funds 3,943,159,387 Grand Total 7,849,961,525 114 Appendix E City Service Overview Matrix 115 116 Service Category General Government Public Officials Mayor Council Manager/Administrative Officer Clerk Attorney/Legal Services Auditor-Controller Treasurer/Treasury Program Prosecutor/Prosecution Administrative Administration/Central Services Insurance/Liability/Risk Management Intergovernmental Relations Finance Property Ownership/Management/Maintenance Human Resources/Personnel Information Systems Purchasing Central Stores/Warehouse Commissions Table E.1 City Service Overview Matrix Bell Beverly Gardens Hills Bradbury Cerritos Compton Gardena Glendale Hawthorne MM MM M M M M M MM M M M M M MM M M M M M MI I I MIM M M MM M I MM M M M M M MM M M MM MM M M MM MM M M M M M MM M MM M M M MM M M MM MM MM M M M M M M M M M M M MI M 117 Service Category Resident Services Smog Control/AQMD Programs Weed Abatement Nuisance Abatement Pest Control Volunteer Programs Community Support Programs Public Safety Police Police/Law Enforcement Parking Fire Fire Paramedics/EMS Animal Regulation/Control Other Emergency and Disaster Preparedness Public Assistance Human Services Senior Services Family Services Employment and Career Services Table E.1 (continued) Bell Beverly Gardens Hills Bradbury Cerritos Compton Gardena Glendale Hawthorne MI MI MI C MM MM C C MM M MI CM CM C C MM M CM C C MM M MC C C C C MM M M M M M M MM M M MM MM M M C C C M M M 118 Service Category Public Health Public Health Mental Health Programs Leisure and Cultural Services Libraries Libraries and Information Services Parks and Recreation Parks and Recreation Park/Open Space Maintenance Beach/Harbor Cultural Centers and Activities Sports Facilities Public Entertainment/Special Events Youth and Senior Programs/Centers Television/Media Public Works Public Works Administration Transportation Street Maintenance Median/Parkway Maintenance Bikeway/Pedestrian Facilities/Maintenance Lighting Engineering Table E.1 (continued) Bell Beverly Gardens Hills Bradbury Cerritos Compton Gardena Glendale Hawthorne CM CM C M C C M C MI M M M MM M MI MI I M MM M M MM M M M MM M M MM M M MM M M MM M MIC M MIC MIC M M M MIC MM M M M M M MI MC MC MI M M M MI MIC M M M M I MI M M I MM I MM M M M M M MIC 119 Service Category Building and Safety Inspection/Regulation Code Enforcement Sidewalk Maintenance Tree Maintenance Traffic Control (Signals and Signs) Environmental Compliance Other Community Development and Housing Planning Planning and Permitting Development Community Development Economic/Business Development Redevelopment Agencies Housing Housing Assistance Block Grant (CDBG) Enterprise Activities Power Water Sewers/Sanitation Garbage and Recycling Transit Table E.1 (continued) Bell Gardens I I M MI Beverly Hills M M M I M Bradbury I I M Cerritos C MC MIC I MIC Compton Gardena MM M MM MM Glendale M M M M Hawthorne MI MI M MI MC M M MI M MM M M M M M MM MM MM M M M MM MM MM M MM M M M IM M MI M I M MI IC MM M MC IC M I MM M I CC CM M 120 Service Category Oil Proprietary Departments Airport Harbor Debt Service/Public Financing Capital Improvements Table E.1 (continued) Bell Beverly Gardens Hills Bradbury Cerritos Compton Gardena Glendale Hawthorne MM M M M M M MM M M M M M M M M 121 Service Category General Government Public Officials Mayor Council Manager/Administrative Officer Clerk Attorney/Legal Services Auditor-Controller Treasurer/Treasury Program Prosecutor/Prosecution Administrative Administration/Central Services Insurance/Liability/Risk Management Intergovernmental Relations Finance Property Ownership/Management/Maintenance Human Resources/Personnel Information Systems Purchasing Central Stores/Warehouse Commissions Table E.1 (continued) Long Los Manhattan Monterey Inglewood Irwindale Lakewood Beach Angeles Malibu Beach Park M MM M M M MMM M M M M MMM M M M M MMM M MI I M M MI M MM M MM M MM I MMM MM M MMM MM M MI MMMM MM MI M MI MI MI M M M MMM M M I MMM M M MM M MM M MM MM M M MI I M M M M M MI M I M M M 122 Service Category Resident Services Smog Control/AQMD Programs Weed Abatement Nuisance Abatement Pest Control Volunteer Programs Community Support Programs Public Safety Police Police/Law Enforcement Parking Fire Fire Paramedics/EMS Animal Regulation/Control Other Emergency and Disaster Preparedness Public Assistance Human Services Senior Services Family Services Table E.1 (continued) Long Los Manhattan Monterey Inglewood Irwindale Lakewood Beach Angeles Malibu Beach Park MCM M MCM C MM M M M C MM C M MM CI M M M M C C MM C M M M C C MM C M M CC I M M C MC MI M M MC M M M M M M M M MI M MC 123 Service Category Employment and Career Services Public Health Public Health Mental Health Programs Leisure and Cultural Services Libraries Libraries and Information Services Parks and Recreation Parks and Recreation Park/Open Space Maintenance Beach/Harbor Cultural Centers and Activities Sports Facilities Public Entertainment/Special Events Youth and Senior Programs/Centers Television/Media Public Works Public Works Administration Transportation Street Maintenance Median/Parkway Maintenance Table E.1 (continued) Long Inglewood Irwindale Lakewood Beach M Los Angeles Manhattan Monterey Malibu Beach Park M M M C MM C C M M MI M M MI M MI M M M M M M M MM M MMM MI M MM M M M MMM M M MI MI MIC MIC M M MI MI M M MM M M M CI M M MI MC CI M MI M MI M IM M MI MI M M I M MI M M I 124 Service Category Bikeway/Pedestrian Facilities/Maintenance Lighting Engineering Building and Safety Inspection/Regulation Code Enforcement Sidewalk Maintenance Tree Maintenance Traffic Control (Signals and Signs) Environmental Compliance Other Community Development and Housing Planning Planning and Permitting Development Community Development Economic/Business Development Redevelopment Agencies Housing Housing Assistance Block Grant (CDBG) Enterprise Activities Power Table E.1 (continued) Long Los Manhattan Monterey Inglewood Irwindale Lakewood Beach Angeles Malibu Beach Park M MC I M MM M M MIC M M M M M M MC CI M M M MI M M MC CI M MM M MI I MI MI MI MC I I MI M M M M M M M MI M M MM M MM M MM M I MMM M I MM MM M M I M M M 125 Service Category Water Sewers/Sanitation Garbage and Recycling Transit Oil Proprietary Departments Airport Harbor Debt Service/Public Financing Capital Improvements Table E.1 (continued) Inglewood Irwindale Lakewood MI M M MI I II C C CI Long Beach M M M M Los Angeles M M M M Malibu MI I Manhattan Monterey Beach Park MI M MC MI II C CMI MM MM M M M MMM M M M MMM M M M M 126 Service Category General Government Public Officials Mayor Council Manager/Administrative Officer Clerk Attorney/Legal Services Auditor-Controller Treasurer/Treasury Program Prosecutor/Prosecution Administrative Administration/Central Services Insurance/Liability/Risk Management Intergovernmental Relations Finance Property Ownership/Management/Maintenance Human Resources/Personnel Information Systems Purchasing Central Stores/Warehouse Commissions Table E.1 (continued) Santa Santa Signal West Pasadena Pomona Rosemead Clarita Monica Hill Walnut Hollywood MM M M M MMM M M M MM M M M MMM MMM MM M M M I M M M I MM M MM M M MC M M MMM M M M M M MM MM I IM M M M M M M M MI M M M M MI M MI MM MMM M M MM M M M MI MI MM M MM M 127 Service Category Resident Services Smog Control/AQMD Programs Weed Abatement Nuisance Abatement Pest Control Volunteer Programs Community Support Programs Public Safety Police Police/Law Enforcement Parking Fire Fire Paramedics/EMS Animal Regulation/Control Other Emergency and Disaster Preparedness Public Assistance Human Services Senior Services Family Services Table E.1 (continued) Santa Santa Signal West Pasadena Pomona Rosemead Clarita Monica Hill Walnut Hollywood MI C MI M MM C C MM C MC I IC M C C CMC C M C C CMC C M I C C M MI C M M M MMM M MM M M MMM MM I C I C C C C I 128 Service Category Employment and Career Services Public Health Public Health Mental Health Programs Leisure and Cultural Services Libraries Libraries and Information Services Parks and Recreation Parks and Recreation Park/Open Space Maintenance Beach/Harbor Cultural Centers and Activities Sports Facilities Public Entertainment/Special Events Youth and Senior Programs/Centers Television/Media Public Works Public Works Administration Transportation Street Maintenance Median/Parkway Maintenance Table E.1 (continued) Santa Pasadena Pomona Rosemead Clarita M Santa Monica Signal Hill West Walnut Hollywood I M I MM C C MM C C M M MI M M MI MI M M M M M MI MI MI MC M M M MM MM MMM M MM M M M M M MI M M M MMM M M MI MI M M M MIC MIC MIC MI MIC MIC M M M MM M M M MIC M MI MC M M M MIC MC MC M C MIC M MI IM I MIC 129 Service Category Bikeway/Pedestrian Facilities/Maintenance Lighting Engineering Building and Safety Inspection/Regulation Code Enforcement Sidewalk Maintenance Tree Maintenance Traffic Control (Signals and Signs) Environmental Compliance Other Community Development and Housing Planning Planning and Permitting Development Community Development Economic/Business Development Redevelopment Agencies Housing Housing Assistance Block Grant (CDBG) Enterprise Activities Power Table E.1 (continued) Santa Pasadena Pomona Rosemead Clarita MM MM I M MMMM M M MC M MI I MI M Santa Monica MI M MI I MI M M Signal Hill M MI M M M Walnut MI I I IC M West Hollywood M IC I CM M M M M MI M M M MM M M M MI M MM M MM MM M M M MM M M M MM M MI MM Table E.1 (continued) 130 Service Category Water Sewers/Sanitation Garbage and Recycling Transit Oil Proprietary Departments Airport Harbor Debt Service/Public Financing Capital Improvements Pasadena M Pomona Rosemead M M MIC MM MC CI Santa Clarita MIC I MC MMMM MMMM NOTE: M = municipal; C = county contract; I = independent contract. Santa Monica M MI M M M M M Signal Hill M M M M M M West Walnut Hollywood I MC MC MI MIC M MM MM Appendix F City Expenditures, by Department or Program, 1997–1998 131 Table F.1 City Expenditures, by Department or Program, 1997–1998 Department/Program Bell Gardens Administrative Officer (City Manager) 1,254,113 Affirmative Action Compliance Office 0 Agricultural Commissioner/ Weights and Measures 0 Animal Care and Control 0 Auditor-Controller 455,100 Board of Supervisors (City Council/Mayor) 314,000 Children and Family Services 501,800 Community and Senior Services 677,682 Consumer Affairs 0 County Counsel 780,000 District Attorney 0 Fire 0 Health Services 257,630 Human Relations Commission 0 Human Resources 391,003 Internal Services 0 Mental Health 0 Music Center Operations 0 Parks and Recreation 2,484,685 Public Library 0 Public Social Services 0 Public Works—County Engineer 479,250 Public Works—Facility Project Management 0 Public Works—Flood Control District 0 Public Works—Public Ways/Public Facilities 2,780,860 Public Works—Reimbursement for Sewer Construction 0 Regional Planning 3,733,588 Registrar-Recorder/County Clerk 264,500 Sheriff 7,203,648 Treasurer and Tax Collector 53,000 Enterprise Activities 3,428,960 Proprietary Departments 0 Capital Improvement Projects 3,689,636 Debt Service/Public Financing 0 Beverly Hills 3,726,268 0 0 0 2,898,723 0 0 0 0 1,554,277 0 10,132,600 0 0 971,174 16,949,221 0 0 27,083,245 4,927,290 220,858 6,844,414 0 0 6,264,649 0 1,156,832 469,876 18,581,611 0 31,469,307 0 6,688,744 0 Totals 28,749,455 139,939,089 Bradbury 37,880 0 0 1,750 45,991 9,375 4,804 8,500 0 40,250 0 0 0 0 0 63,706 0 0 18,708 0 0 56,400 0 0 21,035 0 78,311 16,540 54,439 0 0 0 624,100 0 1,081,789 Cerritos 2,291,950 0 0 105,460 748,210 285,330 0 965,140 0 393,880 0 0 0 0 0 6,554,020 0 8,286,510 7,704,240 2,341,320 0 4,522,900 0 0 3,157,670 0 5,243,320 348,170 7,314,220 0 6,534,120 0 24,811,210 0 81,607,670 132 Table F.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Public Works—Reimbursement for Sewer Construction Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Compton 3,614,724 0 0 0 1,094,927 649,998 9,789,096 0 0 4,527,064 0 8,949,647 0 0 479,867 22,975,746 0 0 2,684,368 0 2,258,945 7,399,299 0 0 7,255,970 0 24,885,647 358,551 17,740,715 551,434 12,283,435 0 0 0 Totals 127,499,433 Gardena Glendale 2,725,226 2,938,596 00 0 0 777,212 0 418,200 1,955,886 145,408 1,856,975 436,199 23,143,818 2,338,869 50,000 311,803 0 5,428,301 0 0 295,175 3,358,046 38,019 0 2,242,774 0 5,005,104 1,435,268 0 1,265,092 0 19,841,965 0 0 815,354 6,028,757 0 0 6,950,468 5,187,975 12,648,443 899,057 17,634,271 00 00 10,270,930 36,823,159 199,645 394,391 0 78,676,374 399,146 11,110,356 441,440 0 0 1,178,000 0 784,600 29,616,639 1,762,472 218,003,041 0 50,981,000 7,138,485 49,465,877 524,486,062 Hawthorne 1,520,911 0 0 0 364,075 140,057 9,437,077 93,557 167,441 279,188 213,251 0 0 0 1,365,687 10,084,623 0 0 2,035,153 0 0 8,800,998 0 0 6,396,216 0 5,322,658 170,382 15,772,670 303,658 1,412,242 711,207 750,000 2,139,811 67,480,862 133 Table F.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Public Works—Reimbursement for Sewer Construction Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Inglewood 13,870,198 0 285,205 0 1,112,499 462,746 13,053,734 18,403,695 0 697,699 304,626 9,668,912 0 0 9,210,294 13,828,104 0 0 5,408,351 2,547,317 0 11,349,592 0 0 6,804,366 0 18,277,206 378,862 29,404,075 570,446 15,952,476 0 44,657,255 13,094,119 Totals 229,341,777 Irwindale Lakewood Long Beach 1,008,401 2,697,475 9,077,557 00 0 0 0 318,085 0 52,704 549,515 0 1,697,404 226,335,545 225,044 0 136,702 1,581,722 3,602,475 51,829,199 333,571 0 126,261 0 0 0 0 389,719 942,528 0 0 831,732 190,724 0 1,337,536 0 257,728 0 0 0 0 1,134,487 2,669,281 0 0 4,217,445 0 0 17,300,129 0 7,740,256 3,133,067 57,924,783 18,886,147 4,505,186 4,362,740 52,031,668 0 0 42,723,454 11,307,374 0 893,586 3,892,104 154,360,956 00 0 00 0 835,677 4,805,641 26,834,083 0 176,565 0 343,210 0 69,534,098 77,212 2,741,298 43,982 0 0 200,500 0 180,036 6,953,793 115,696 11,155,076 0 5,581,597 0 2,882,351 129,867,702 11,731,396 185,774,832 312,516,649 207,197,787 0 9,334,885 47,661,748 1,613,156,838 134 Table F.1 (continued) Department/Program Los Angeles Administrative Officer (City Manager) 9,702,000 Affirmative Action Compliance Office 0 Agricultural Commissioner/ Weights and Measures 2,226,000 Animal Care and Control 7,785,400 Auditor-Controller 13,175,800 Board of Supervisors (City Council/Mayor) 27,854,770 Children and Family Services 14,963,500 Community and Senior Services 2,684,700 Consumer Affairs 0 County Counsel 116,262,000 District Attorney 0 Fire 304,791,000 Health Services 0 Human Relations Commission 714,600 Human Resources 804,434,241 Internal Services 313,830,000 Mental Health 0 Music Center Operations 0 Parks and Recreation 173,887,295 Public Library 47,208,200 Public Social Services 0 Public Works—County Engineer 326,635,250 Public Works—Facility Project Management 0 Public Works—Flood Control District 0 Public Works—Public Ways/Public Facilities 364,962,495 Public Works—Reimbursement for Sewer Construction 0 Regional Planning 247,457,445 Registrar-Recorder/County Clerk 22,208,000 Sheriff 809,993,650 Treasurer and Tax Collector 2,107,300 Enterprise Activities 4,035,626,054 Proprietary Departments 909,957,988 Capital Improvement Projects 261,735,479 Debt Service/Public Financing 431,799,135 Totals 9,252,002,302 Malibu Manhattan Beach Monterey Park 356,840 1,508,406 1,697,320 00 0 0 28,000 241,680 0 126,690 1,855,488 0 235,470 509,006 60,410 0 279,905 0 68,502 1,585,503 188,230 59,280 548,020 0 0 0 0 0 723,872 0 0 425,590 0 0 0 0 238,918 0 3,967,020 0 0 519,612 2,754,923 0 0 5,763,944 0 0 526,628 0 260,000 0 5,320,678 0 0 2,159,629 2,073,434 0 0 2,446,465 1,313,976 0 1,971,504 6,381,350 5,152,728 00 0 169,240 0 0 786,260 3,560,284 2,684,747 0 214,560 0 1,063,574 0 2,214,127 0 3,713,430 0 0 0 1,720,538 0 251,502 9,840,199 545,084 7,609,533 0 0 0 233,637 9,809,612 146,324 4,811,788 0 2,376,046 2,677,254 11,207,454 46,266,432 48,302,874 135 Table F.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Public Works—Reimbursement for Sewer Construction Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Pasadena 7,756,706 454,560 0 0 2,756,603 1,074,231 33,492,516 9,613,929 0 2,751,179 1,259,384 19,873,509 7,650,880 0 1,442,952 16,359,384 0 0 10,987,095 7,190,893 240,000 15,742,870 0 0 11,836,702 0 5,443,493 770,070 31,728,231 1,856,363 155,128,321 0 0 0 Totals 345,409,871 Pomona 4,605,267 0 0 292,652 1,086,210 201,515 13,042,599 2,276,891 0 406,929 0 13,314,791 0 0 2,880,462 4,334,155 0 0 165,973 1,612,671 0 0 0 0 15,856,695 0 30,331,354 278,184 27,557,273 0 37,840,020 0 2,765,025 49,225,746 208,074,412 Rosemead 877,270 0 0 77,000 242,750 93,850 0 0 0 127,700 0 0 0 0 0 424,610 0 0 1,898,800 0 0 759,000 0 0 2,376,050 0 1,502,221 82,540 4,355,220 12,020 150,700 0 0 0 12,979,731 Santa Clarita 1,771,840 0 0 0 752,015 171,140 433,485 2,357,045 0 0 0 35,000 0 0 410,890 4,120,515 0 0 8,373,747 0 0 5,151,505 3,402,340 0 13,969,328 0 2,140,665 430,730 9,560,000 0 1,909,760 0 24,749,920 5,490,515 85,230,440 136 Table F.1 (continued) Department/Program Santa Monica Administrative Officer (City Manager) 9,314,313 Affirmative Action Compliance Office 0 Agricultural Commissioner/ Weights and Measures 0 Animal Care and Control 455,008 Auditor-Controller 1,889,119 Board of Supervisors (City Council/Mayor) 206,326 Children and Family Services 10,788,358 Community and Senior Services 1,760,743 Consumer Affairs 699,181 County Counsel 3,923,342 District Attorney 0 Fire 11,473,302 Health Services 0 Human Relations Commission 0 Human Resources 1,975,738 Internal Services 31,912,693 Mental Health 0 Music Center Operations 0 Parks and Recreation 11,964,303 Public Library 4,852,817 Public Social Services 0 Public Works—County Engineer 14,901,241 Public Works—Facility Project Management 0 Public Works—Flood Control District 0 Public Works—Public Ways/Public Facilities 27,538,411 Public Works—Reimbursement for Sewer Construction 0 Regional Planning 7,420,407 Registrar-Recorder/County Clerk 1,134,459 Sheriff 32,386,955 Treasurer and Tax Collector 1,165,456 Enterprise Activities 22,860,745 Proprietary Departments 1,616,424 Capital Improvement Projects 82,164,989 Debt Service/Public Financing 0 Totals 282,404,330 Signal Hill 123,050 0 0 0 967,610 147,160 4,302,150 264,137 0 0 0 0 0 0 229,613 1,257,643 0 0 490,360 219,899 0 1,059,004 0 0 1,874,260 0 1,017,158 82,848 4,354,302 11,525 2,523,467 0 0 5,999,181 24,923,367 Walnut 554,336 0 19,000 21,492 230,189 21,451 12,910 926,441 58,139 114,300 0 0 0 0 46,445 220,592 0 0 3,062,037 0 0 376,818 0 0 2,044,591 0 1,178,780 131,338 2,474,429 13,895 15,000 0 3,499,893 29,260 15,051,336 West Hollywood 410,461 0 0 0 2,441,627 702,835 1,961,560 4,240,029 881,620 475,000 0 0 0 0 485,474 3,099,138 0 0 87,430 0 0 4,413,367 0 0 3,066,171 0 5,078,347 655,282 8,908,182 457,800 2,737,384 0 45,000,000 0 85,101,707 137 Table F.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Public Works—Reimbursement for Sewer Construction Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Totals Sample Total 83,441,108 454,560 2,530,205 11,297,230 262,803,865 37,289,429 191,780,806 67,732,720 1,915,661 143,080,886 4,910,328 470,721,508 26,794,657 5,219,786 834,000,556 516,596,659 38,019 8,286,510 323,937,662 88,900,456 20,373,350 599,677,464 3,402,340 169,240 562,806,250 199,645 512,884,331 32,588,816 1,231,042,649 21,889,291 4,757,226,261 1,224,802,268 770,371,719 517,593,506 13,336,759,741 138 Appendix G City Contract Expenditures, by Department or Program, 1997–1998 139 Table G.1 City Contract Expenditures, by Department or Program, 1997–1998 Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Bell Gardens 369,013 0 0 0 150,400 189,500 194,100 188,052 0 780,000 0 0 0 0 246,300 0 0 0 1,033,785 0 0 427,350 0 0 1,656,760 946,450 54,100 423,320 2,000 830,200 0 0 0 Totals 7,491,330 Beverly Hills 2,188,784 0 0 0 611,401 0 0 0 0 1,483,477 0 139,304 0 0 206,115 8,742,834 0 0 10,912,881 108,932 298,707 1,324,579 0 0 131,898 37,233 94,351 251,705 0 18,968,278 0 0 0 45,500,479 Bradbury 0 0 0 1,750 0 0 0 0 0 40,250 0 0 0 0 0 0 0 0 0 0 0 51,400 0 0 4,500 23,300 0 54,139 0 0 0 0 0 175,339 Cerritos 126,300 0 0 105,460 36,000 100 0 35,400 0 393,380 0 0 0 0 0 200,420 0 413,000 1,196,740 77,250 0 2,766,400 0 0 186,600 619,450 0 6,698,120 0 2,654,470 0 0 0 15,118,510 140 Table G.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Compton 2,319,976 0 0 0 74,297 90,000 214,108 0 0 226,500 0 57,000 0 0 35,000 3,758,011 0 0 11,000 0 65,861 786,000 0 0 340,000 487,332 8,000 394,951 0 9,120,107 0 0 0 Gardena Hawthorne 123,360 0 00 0 0 1,700 0 0 65,000 0 170,160 219,636 3,712 235,000 0 262,533 0 0 94,413 119,554 0 0 3,000 0 145,000 113,853 10,000 356,767 29,000 0 0 0 0 0 0 22,000 4,336,592 0 0 148,325 0 0 6,031,500 00 00 429,860 36,273 1,242 710,372 600 0 0 0 0 93,900 450,864 77,500 3,691,680 12,000 72,500 18,000 250,000 5,500 Inglewood 147,000 0 4,000 0 38,000 0 108,600 10,079,533 0 0 3,500 149,000 0 0 21,750 1,338,000 0 0 152,850 186,000 0 8,095,250 0 0 38,000 1,769,875 56,850 748,533 10,000 7,724,250 0 0 0 Totals 17,988,143 2,670,268 15,671,128 30,670,991 141 Table G.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Irwindale 40,160 0 0 0 8,225 2,400 0 18,000 0 77,000 0 0 0 0 2,775 35,900 0 0 12,696 0 0 69,300 0 0 332,039 155,000 0 13,000 2,000 0 0 0 0 Lakewood 338,200 0 0 48,850 51,445 0 1,475,000 141,375 0 188,280 0 0 0 0 24,150 667,888 0 0 370,791 0 0 3,233,100 0 0 2,920,945 16,150 500 6,105,903 28,179 281,540 0 0 0 Los Angeles 739,000 0 297,000 396,000 3,315,000 1,454,100 1,677,000 62,000 0 2,000,000 0 1,628,000 0 138,000 13,117,000 91,153,100 0 0 3,178,000 0 0 10,141,000 0 0 23,020,000 4,455,000 529,000 8,000,000 132,500 97,082,000 0 0 0 Totals 768,495 15,892,296 262,513,700 Malibu 48,000 0 0 28,000 27,980 0 0 155,300 0 292,000 0 0 0 0 0 2,847 0 0 55,140 0 0 664,320 0 110,000 536,630 145,000 0 3,505,680 0 0 0 1,720,538 0 7,291,435 142 Table G.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Manhattan Beach 17,150 0 0 9,500 166,900 500 0 0 0 26,250 0 199,400 0 0 22,140 593,527 0 0 667,270 0 0 3,122,721 0 0 395,989 104,745 115,480 658,810 31,910 3,512,478 0 0 0 Monterey Park 63,235 0 0 67,282 145,640 0 256,106 60,600 0 260,000 0 118,079 0 0 83,548 333,210 0 0 551,545 62,291 0 3,131,305 0 0 897,199 360,116 84,000 291,589 2,680 176,820 0 0 20,000 Totals 9,644,770 6,965,245 Pomona Rosemead 258,635 21,600 00 0 0 55,395 0 77,000 12,500 0 1,598,178 34,729 0 0 0 12,589,953 0 0 0 211,050 0 0 0 0 0 0 0 0 0 0 121,200 0 0 0 0 0 26,100 0 0 3,000 0 0 133,300 00 00 1,863,090 92,995 2,700 138,710 0 1,416,168 0 511,775 0 944,360 275,000 0 4,205,370 0 42,000 0 0 0 18,773,378 5,861,430 143 Table G.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Totals Santa Clarita 77,070 0 0 0 191,690 0 338,300 511,235 0 0 0 35,000 0 0 0 214,775 0 0 1,698,960 0 0 453,800 3,098,325 0 206,070 100,000 0 0 0 79,000 0 0 0 7,004,225 Santa Monica 72,000 0 0 15,592 26,965 0 292,281 45,153 154,396 119,424 0 55,190 0 0 10,000 991,165 0 0 2,890,166 95,600 0 824,517 0 0 2,884,425 1,008,077 87,226 306,833 421,949 3,574,414 50,890 0 0 13,926,263 Signal Hill 5,600 0 0 0 8,000 37,450 3,000 0 0 0 0 0 0 0 5,500 25,825 0 0 50 7,400 0 26,000 0 0 174,900 94,500 500 76,350 0 28,100 0 0 0 493,175 Walnut 500 0 19,000 15,000 0 0 25 154,750 0 0 0 0 0 0 0 1,140 0 0 817,944 0 0 43,000 0 0 434,540 28,800 21,200 2,397,244 1,500 0 0 0 0 3,934,643 144 Table G.1 (continued) Department/Program Administrative Officer (City Manager) Affirmative Action Compliance Office Agricultural Commissioner/ Weights and Measures Animal Care and Control Auditor-Controller Board of Supervisors (City Council/Mayor) Children and Family Services Community and Senior Services Consumer Affairs County Counsel District Attorney Fire Health Services Human Relations Commission Human Resources Internal Services Mental Health Music Center Operations Parks and Recreation Public Library Public Social Services Public Works—County Engineer Public Works—Facility Project Management Public Works—Flood Control District Public Works—Public Ways/Public Facilities Regional Planning Registrar-Recorder/County Clerk Sheriff Treasurer and Tax Collector Enterprise Activities Proprietary Departments Capital Improvement Projects Debt Service/Public Financing Totals West Hollywood 33,000 0 0 0 0 3,000 160,370 115,056 90,200 475,000 0 0 0 0 23,381 1,023,094 0 0 16,322 0 0 2,435,219 0 0 282,000 1,938,913 78,343 8,908,182 44,980 2,012,430 0 0 0 17,639,490 Sample Totals 6,988,583 0 320,000 764,434 4,986,538 1,787,050 6,843,995 11,849,819 248,308 6,717,761 3,500 15,233,459 0 138,000 13,914,072 113,775,032 0 413,000 23,720,465 537,473 509,568 43,873,914 3,098,325 110,000 37,773,705 13,145,073 1,210,992 47,580,491 690,298 147,574,755 68,890 2,482,313 25,500 505,994,733 145 Bibliography Baldassare, Mark, 2000. 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Proposition 13: Some Unintended Consequences, Public Policy Institute of California, San Francisco, California. Coleman, Michael J., 1999. “Property Tax Fairness Among Local Governments Means Consolidating Local Governance,” Cal-Tax Digest. Dardia, Michael, 1998. Subsidizing Redevelopment in California, Public Policy Institute of California, San Francisco, California. Erie, Steven P., Christopher Hoene, and Gregory Saxton, 1998. “Coping with Loss of Fiscal Autonomy: Lessons from Los Angeles County and Selected Cities, 1990–98,” John Randolph Haynes and Dora Haynes Foundation, Los Angeles, California. Frates, Steven B., and Eric S. Norby, 1996. An Analysis of Los Angeles County Government for the Howard Jarvis Taxpayers’ Educational Foundation, The Rose Institute and Claremont-McKenna College, Claremont, California. Hoene, Christopher, 1998. “Fiscal Barriers to Municipal Governance: Proposition 13 Twenty Years Later,” paper presented at the Annual Meeting of the American Political Science Association, Boston, Massachusetts. 148 Jessee, Laura, 1990. “Productivity: Part of the Governmental Culture in Los Angeles County,” Government Finance Review, December, pp. 15–18. Legislative Analyst’s Office, 1995. Los Angeles County’s Fiscal Problems, Sacramento, California. Legislative Analyst’s Office, 1998. California Counties: A Look at Program Performance, Sacramento, California. Lewis, Paul, and Elisa Barbour, 1999. California Cities and the Local Sales Tax, Public Policy Institute of California, San Francisco, California. Los Angeles County Blue Ribbon Budget Task Force Report, 1996. Los Angeles, California. Los Angeles County Citizens’ Economy and Efficiency Commission, 1992. Public Access to Decision Making, Los Angeles, California. Los Angeles County Government Public Commission Report, 1976. To Serve Seven Million, Los Angeles, California. The Metropolitan Forum Project, 1998. State of California Legislative Field Hearing Results and Briefing Materials on State-Local Finance: Quarterly Document Update for Metro Los Angeles, Los Angeles, California. Miller, Gary, 1981. Cities by Contract: The Politics of Municipal Incorporation, MIT Press, Cambridge, Massachusetts. Municipal Analysts Services, Inc., 1997. Governments of California, Austin, Texas. Shires, Michael, 1999. Patterns in California Government Revenues Since Proposition 13, Public Policy Institute of California, San Francisco, California. Shires, Michael, John Ellwood, and Mary Sprague, 1998. Has Proposition 13 Delivered? The Changing Tax Burden in California, Public Policy Institute of California, San Francisco, California. 149 Schrag, Peter, 1998. Paradise Lost: California’s Experience, America’s Future, The New Press, New York, New York. Silva, Fred, and Elisa Barbour, 1999. The State-Local Fiscal Relationship in California: A Changing Balance of Power, Public Policy Institute of California, San Francisco, California. Swenson, Jennifer, 1999. County Services: A Tale of Eight Counties, California Research Bureau, Sacramento, California. United Way of Greater Los Angeles, 1999. A Tale of Two Cities: Promise and Peril in Los Angeles, Los Angeles, California. 150 About the Authors MARK BALDASSARE Mark Baldassare is a senior fellow at PPIC, where he directs the PPIC Statewide Survey. His research interests include state and local finance, demographic change, public opinion, and urban public policy. He is the author of eight books, including California in the New Millennium: The Changing Social and Political Landscape (2000) and When Government Fails: The Orange County Bankruptcy (1998). He holds the Johnson Chair in Civic Governance at the University of California, Irvine, and is the founder and director of the Orange County Annual Survey, based at UCI. He has served as a special advisor to the Governor’s Council on Growth Management and has conducted surveys for the Los Angeles Times, the San Francisco Chronicle, and the California Business Roundtable. He holds a B.A. in sociology and psychology from the State University of New York, Stony Brook; an M.A. in sociology from the University of California, Santa Barbara; and a Ph.D. in sociology from the University of California, Berkeley. MICHAEL A. SHIRES Michael Shires is the author of several publications on U.S. trade relations, higher education, school finance, and state and local governance. He has also been active as a consultant to private companies on strategic planning, marketing research, and tax planning and preparation. Before joining PPIC, he was a doctoral fellow at the RAND 151 Graduate School of Policy Studies, concentrating on domestic education policy, California fiscal policy, and international trade policy. He holds a B.A. in economics from the University of California, Los Angeles; an M.B.A. from UCLA’s Anderson Graduate School of Management; and a Ph.D. in public policy analysis from the RAND Graduate School of Policy Studies. CHRISTOPHER HOENE Christopher Hoene is a dissertation fellow at PPIC. His dissertation examines the relationship between the fiscalization of land use and municipal revenues and expenditures. He also assists with the PPIC Statewide Survey. Prior to joining PPIC, he worked as a senior research associate at the Claremont Graduate University Research Institute, where he coordinated projects on metropolitan governance and sustainable communities and co-authored a report on the capacity of local governments to cope with reduced fiscal autonomy in the postProposition 13 era. He holds a B.A. in political science from Albertson College of Idaho and a master’s in public policy and a Ph.D. in political science from the Claremont Graduate University. AARON KOFFMAN Aaron Koffman was a research assistant at PPIC in 1998 and 1999, examining the fiscal structure of administrative subdivisions in local governments. He has researched labor and demographic statistics and has also completed fieldwork on health rights in Latin America and urban development in the San Francisco Bay area. 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