Tax Windfall Now Called Insufficient to Rescue Clinics

Hopes were dashed Tuesday for a windfall of higher-than-expected property tax collections, which had been counted on to prevent deep service cuts in Los Angeles County’s mental health care system.

County Administrative Officer Richard A. Dixon told the Board of Supervisors that he believes only $16.7 million of a potential $50 million in increased revenue would be available to finance county programs. Whether mental health--an early target of projected county budget cuts--would be one of the programs affected was unclear.

A superior court judge Monday stopped an attempt by the supervisors to close mental health clinics in Wilmington, San Pedro, South-Central Los Angeles, Arcadia, North Hollywood, Canoga Park and Carson. Clinics are exempted from cuts for now, but county officials said they will press for the closures through court appeals.

Proposal by Hahn

Supervisor Kenneth Hahn, trying to avert any mental health cuts, had proposed giving the clinics $24 million of $50 million in property tax revenue that County Assessor John Lynch had estimated would be forthcoming.

The rest of the money, according to the Hahn proposal, would have gone to other threatened county programs.

But Dixon said Tuesday that an analysis by his office showed only $16.7 million would be available. With this smaller amount to work with, supervisors will have to trim other programs to keep the mental health clinics open, if the judge’s decision is upheld.

Much of the $50 million, Dixon said, would be eaten up by previously granted property tax exemptions and by various redevelopment agencies around the county. Under the state redevelopment law, redevelopment agencies keep a substantial portion of the property tax increases that result from their improvement projects.

Lynch, calling Dixon’s approach “very conservative,” insisted the entire $50 million would be available for the current fiscal year.

Dixon’s report was another piece of bad news for county officials, who face seemingly certain cuts in hoped-for state aid.

Dixon told the board the refusal of the Legislature to provide assistance will leave the current county financial obligations almost $100 million short of projected revenues at the end of the current fiscal year in June, unless lawmakers offer help in the final hours of a session that ends tonight.

Dixon noted that “the Legislature is still in session and our fiscal picture could change somewhat.” But he urged a series of budget cutting steps, including:

- Studying reductions in every department except for Mental Health, Children’s Services and Health Services.

- Attempting to become part of federal programs that would help finance foster care and psychiatric and psychological treatment for immigrants.

- Postponing for a year a financial incentive plan to reward departments that save money.

- Begin the process of setting up public hearings for possible reductions in the county hospital system.

The mental health clinics, which provide day care to thousands of mentally ill men, women and children unable to afford private psychiatrists or psychologists, have been the supervisors’ most immediate budget cutting targets.

Supervisors have persistently refused to cut the more politically popular sheriff’s and fire departments’ budgets. In fact, Supervisor Mike Antonovich reiterated to his colleagues Tuesday that he would support no such cuts. And state law makes it all but impossible to cut court costs and difficult to reduce appropriations to county hospitals.

The gloomy session in the County Hall of Administration was a graphic example of how the state’s budget crisis, caused by a drop in anticipated tax revenues, has reached into the streets of Los Angeles County.

The county, like other California counties, operates many programs for the state, largely financing them with state funds. Among them are the mental health clinics, the courts, the jails and welfare. Reduced state revenues have cut the amount of money available for such programs, even though costs have increased by higher caseloads of the mentally ill, more arrests and more criminal court cases.

Looking for More Funds

Supervisor Ed Edelman asked his colleagues to join in a final appeal to Gov. George Deukmejian and the Legislature for more aid.

“Instead of accepting the cuts, we should try to fight them,” he said.

But Chairman Deane Dana, a Republican political ally of the governor, said he saw little prospect of getting more money from Sacramento before the scheduled adjournment of the Legislature.

“No one is talking to anyone about these problems,” said Dana.