$48-Million Oops Won’t Mean Massive County Layoffs

Orange County budget officials will present the Board of Supervisors Oct. 4 with nearly $48 million in cuts to the current year's budget, an action made necessary after Gov. Jerry Brown took back that much from the county to balance the state budget.

But fears that the cuts will cause massive layoffs seem to be unfounded, at least for now. In fact, the only county agency that appears to be facing significant job cuts is the public defender's office.

The county's budget staff will recommend that much of the gap be filled by taking back $30 million in budget augmentations approved earlier in the year after some sales and property tax revenues showed slight growth.

The budget staff will also recommend that the county tap its reserve fund for about $8 million. Other proposed tweaks include revising tax revenue assumptions for property tax and for a special public safety tax known as Proposition 172.

Although the budget staff will recommend more than $18 million in cuts to health and social service programs, those cuts will largely be eased by adjusting other state grant revenues to fill the gap and will not trigger any job cuts, officials said.

However, slightly more than $7 million in cuts will come directly from the district attorney's and public defender's offices.

Budget officials said the DA would likely be able to forestall job cuts by dipping into a special reserve account set aside for the Proposition 172 sales tax funds. The public defender, however, will not have such a cushion and may lose up to a dozen jobs.

County officials left $48 million on the table after they refinanced Orange County's bankruptcy debt in 2005. While county supervisors and senior finance staff knew that the refinancing had detached an important legislative authorization for certain vehicle license fees, they never renewed the authorization despite numerous opportunities.

Earlier this year, Gov. Jerry Brown's budget staff found the glitch and took the money to help balance the state budget.

While county officials and legislators like Assemblyman Jose Solorio have introduced legislation to recoup the funds, those efforts have been unsuccessful. County supervisors have authorized hiring law firms to get the money back.

On Friday, county finance officials confirmed that the League of California Cities also has initiated litigation on behalf of other cities affected by the Sacramento raid on vehicle license fees.

County Budget Director Frank Kim said this year's suggested approach to the Sacramento tax grab would allow the county to avoid large-scale service interruptions.

But next year's budget won't have that kind of slack, especially since general-fund reserves are down to $235 million and budget officials say that is as low as is advisable.

"Those solutions — if they're not available in Year 2, cuts will have to grow," Kim said.

— NORBERTO SANTANA JR.

 

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