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Counties suing state to keep money-spigot flowing
San Joaquin County joins others in legal action against California over budget crises
San Joaquin and Sacramento counties plan to take legal action against the state in an attempt to collect money for human services and other programs.
The lawsuit, which will also involve San Diego County and potentially others, will be filed this week unless the Legislature adopts the state budget and Gov. Arnold Schwarzenegger signs it.
The San Joaquin County Board of Supervisors voted 5-0 on Tuesday to join Sacramento and San Diego counties in the lawsuit, which seeks to force state Controller John Chiang to pay money that these counties typically get from the state for social services.
Several other counties are considering joining the lawsuit this week.
"We're all in the same boat, and it's sinking," said San Joaquin County Supervisor Ken Vogel.
In Sacramento County, the Board of Supervisors directed its county counsel last week to sue the state, according to county spokesman Zeke Holst.
"The state is politically dysfunctional," said Leroy Ornellas, chairman of the San Joaquin County Board of Supervisors. "We won't stand around and tolerate their economic stupidity."
Chiang has announced that he will withhold $3.33 billion in February while paying $6.63 billion. Delayed payments include income tax refunds, Student Aid Commission, operating costs for county employees who administer public assistance programs, and alcohol and drugabuse counseling.
A 30-day delay in payments will cost San Joaquin County about $12.7 million, Vogel said after Tuesday's board meeting. That adds up to $120 million if the state takes six or seven months to pay the county, Vogel said.
Sacramento County, which is considerably larger than San Joaquin, faces a hit ranging from $20 million to $40 million, depending on the month. That's on top of Sacramento County's $55 million mid-year shortfall.
"I have never seen anything like this in my 30 years of public service," Supervisor Don Nottoli, of Galt, said.
San Joaquin County relies on state money to finance such services as temporary housing, senior services, adoption, Medi-Cal, CalWORKS, mental health, foster care and operation of San Joaquin General Hospital, Vogel said.
In Sacramento County, Nottoli said that tens of millions of dollars are spent to assist people depending on the county, such as single-parent families and people who receive aid for many county-administered programs.
"The (state) controller doesn't have the legal authority to withhold or defer state and federal funds that were appropriated by the Legislature," said Michele Bach, supervising deputy county counsel for Sacramento County.
Oh yes he does, said Chiang spokeswoman Hallye Jordan.
"The controller is a constitutional officer who is responsible for paying the state's cash — paying the bills," Jordan said. "The problem is that we have $10 in bills and $6 in the bank. The controller has warned that this day is coming. He said that in December."
Chiang realizes that counties provide vital services to their residents and he shares their frustration, Jordan said.
Ornellas said that San Joaquin County could borrow some of the needed money from other departments, but they charge interest.
Nottoli said that Sacramento County is looking at $17 million in interfund transfers. Supervisors discussed the idea on Tuesday and will probably make a decision on March 3, Nottoli said.
Another concern that San Joaquin County supervisors shared is that withholding payments to counties may not be a one-month situation.
"There's no guarantee that the controller won't turn around and do it in March," Ornellas said.
Contact reporter Ross Farrow at rossf@lodinews.com.
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t jefferson wrote on Feb 11, 2009 7:13 PM:
OTH wrote on Feb 11, 2009 2:50 PM:
You are leaving out the 30 million that he allowed the indian casino owners to walk away from. Now it's only 30 million but maybe it would have helped somewhere in the budget. However they did make a donation to his political war chest. His aides stressed the fact that he didn't solicit the donation. He didn't refuse it either. "
loadeye wrote on Feb 11, 2009 2:23 PM:
wtf wrote on Feb 11, 2009 8:35 AM:
Here's the story Arnold doesn't want you to hear. The biggest single threat to Ken Lay and the electricity lords is a private lawsuit filed last year under California's unique Civil Code provision 17200, the "Unfair Business Practices Act." This litigation, heading to trial now in Los Angeles, would make the power companies return the $9 billion they filched from California electricity and gas customers.
http://www.commondreams.org/views03/1004-05.htm "
wtf wrote on Feb 11, 2009 8:22 AM:
"On May 17, 2001, in the midst of Californias energy crisis, which was largely caused by Enrons scandalous energy market manipulation, Schwarzenegger met with Lay to discuss 'fixing' Californias energy crisis...While California Governor Gray Davis and Lieutenant Governor Cruz Bustamante were taking direct action to re-regulate Californias energy and get back the $9 billion that was vacuumed out of California by Enron and other energy companies, Schwarzenegger was being groomed to overthrow Davis in the recall. Thus canceling plans to re-regulate and recoup the $9 billion.
http://www.nwbotanicals.org/mediawatch/california_recall.htm "
wtf wrote on Feb 11, 2009 8:18 AM:
Mad Dog wrote on Feb 11, 2009 3:11 AM:
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