Supervisor Kathryn Barger on LA County's Balanced Budget & ‘Connecting the Dots’ to Policy Priorities

Yesterday, Los Angeles County adopted a balanced budget of over $30 billion. I’m proud to say that it was a unanimous vote from all five of us on the board. Unfortunately, while we have a balanced budget, we are also facing a lot of uncertainties—not just from the federal government, but also from the state.

One uncertainty we’re facing is whether or not the state is going to transfer a program called In Home Supportive Services down to this county. If they do, that will be a $220 million hit to the county this year, going up to over $500 million in the next four years. This is a significant issue.

We look at the county as a driving engine for providing services throughout our districts. Two-thirds of our budget goes to health and welfare, and a third of that goes to things like infrastructure, roads, libraries, parks, public safety, our sheriffs, and our DA. A cut of $220 million to this county would be devastating. It would mean an overall cut to our departments by approximately 7-8 percent.

On the federal level, it’s more complicated. The Affordable Care Act is for sure something that is going to be a significant cut in funding for LA County. We’ve done an incredible job of getting uninsured people onto some form of insurance, so it’s going to be a huge hit. They’re also talking about cutting HUD programs for affordable housing and Section 8. Housing is a key component of what we’re doing about homelessness with Measures H and HHH, so that’s going to be a huge hit, too. And our senior programs get partial funding form the federal government. Those are just a few of the issues.

The problem is, we’re giving. We give Meals on Wheels. We provide housing. We provide healthcare. And once you provide it, it’s hard to take it away. So the question is how we will fill that gap. The supervisors are going back to DC next week, and it’s more important now than ever for us to tell our story.

What is LA County’s story? I would say it’s this: Charity begins at home. Look at what this county has done over the last two years. We taxed ourselves with Measure M for transportation. Nowhere else is that being done to the degree that we are doing it. We taxed ourselves on Measure H for the homeless. So when we go back to DC, we’re not going back and saying, “We want you to write us a blank check.” We’re saying, “We have capital in place.”

And by the way, it’s not just government—it’s working with the private sector. It’s capitalizing on public-private partnerships. That is important. We need to let Washington know that we are all about working with our private partners to make this economy grow. That is what the president has always focused on: creating jobs and building infrastructure.

This is a perfect storm, if you will, to be a supervisor. I look at the glass as half full. We have some challenges ahead of us with the state and the federal government, but we also have so many opportunities.

I believe there is a link between our efforts with Measure M and homelessness. That link is that in order to build infrastructure, transportation, and roads through Measure M, we are now going to need to find a workforce to make it happen. In fact, back in Washington a couple months ago, I told them that I think our greatest challenge is finding a workforce to get the job done.

Now, that’s not a bad problem to have. We have to go out and partner with tech colleges, with our labor partners’ apprenticeship programs, and with community colleges to make sure that we are training a workforce that’s ready to go in there and start doing the work on the horizon.

The great thing about Measure M is that it does not create competition among projects. It allows projects that can secure P3s, or other funding to accelerate the work, to move forward. A project on the Westside is not going to bump a project on the Eastside. Measure M says: If you can get them done on a parallel timeframe—if you can move up a project slated to start in 2036 to 2024—then have at it! That is an exciting prospect.

Another thing that’s going to make Measure M a success is that it is coming from communities. My former boss, Mike Antonovich, really focused on that bottom-up approach. Even the South Bay, which pushed back, now recognizes that there are opportunities for them. My colleague Janice Hahn is very engaged in working with her South Bay communities to bring forward their priority projects.

For myself, I’m excited about the Gold Line. The prospect of it continuing to the Ontario Airport is not too far off anymore. There was a time when we would talk about that, and everyone would look at us like we had three eyes and say, “It’s not going to happen.” Now people are saying, “When is it going to happen?”

I recently spoke to then-Secretary of Transportation Foxx, and he shook his head and said, “Do you realize that you are the only major city or county that does not have rail linking you to an airport? I find it hard to believe that, in a county the size of Los Angeles, with over 10 million people, that your infrastructure does not have built into it transportation to get to the airport.” He was right. The good news is that at some point soon, we’re probably going to have transportation via rail, not only to Ontario, but also to LAX.

What we’re building now in our transportation system is going to truly benefit the next generation. Look at what’s going on around our transit stations: transit-oriented development. I know my nephew would rather not own a car and be able to live and commute without depending upon a car.

Look at innovations like driverless cars. I have friends who say it’s never going to happen, and I tell them, “I remember when I heard about this thing that was going to be a machine where you could put a card in and get money out.” Everyone thought it was nuts; now, people arguably depend more on ATMs more than on walking into a bank. All of this is not in the too-distant future, and we are looking at these opportunities with our partners like LAEDC.

We need to be business-friendly in California. I believe you can have a clean environment and be business-friendly—I think there is a happy medium. The question is how you get there.

Having worked for the county for 28 years, I’ve seen the good, the bad, and the ugly. The good was when we were at the top of our game, jobs were growing, and we could do no wrong. The bad was in 1995, when healthcare nearly bankrupted the entire county. We were about $1.8 billion in the red, and we thought we were going to have to close hospitals. LA County+USC was on the chopping block.

We were able to go to Washington and negotiate the 1115 waiver, which allowed us to move money out of hospitals into out-patient services in order to maintain a healthier population and reduce hospitalization costs. We were able to stabilize the problem. But we also learned something: We learned that we didn’t have a reserve that would cover the deficit that we were facing.

The board then put together our rainy day fund, where we set aside at least 1 percent of our overall reserve for that year. In other words, it’s a savings account. We’ve been really good at doing that ever since. As a result, in 2008, when we had what some call the Great Recession, we had no work furloughs, no layoffs, and no service reductions. And our labor partners took no pay raises—because they knew that if they did, there would be layoffs, furloughs, and service reductions.

Two of the supervisors, Don Knabe and Mike Antonovich, have retired. We have a new board that really was not there when this all occurred. Yesterday, I brought in a motion that outlined that history and reminded the board that, while we have a lot of needs, it’s also important to remember that what goes up may come down—and we must set aside money to ensure that if or when that does happen, we will be in a position to stand in front of groups and say: no work furloughs, no layoffs, no service reductions.

The motion says that if, for example, I bring in a motion asking for $23 million to fund the Mental Evaluation Teams, which pair our sheriffs with social workers, then the CEO has to identify programs to offset that $23 million so that we’re not drawing down from the rainy day fund.

As someone who has weathered the good and the bad, I can tell you that this is important, not only from a labor standpoint, but also in terms of our credit rating. We’re one of the few government entities that had their credit rating improved, from an AA- to an AA. That wasn’t because we were spending money and not thinking through our reserves. It was because we were fiscally responsible with how we used the money we had, and how we capitalized on the private sector.

I mention the private sector here because the board is currently looking at bringing more jobs in-house and increasing our workforce. Now, there are some jobs that I agree we’re not going to contract out, like social workers. That’s because the need, unfortunately, is constantly there—and at the moment, is actually going up.

But there are also areas in the workforce that flex up and down, where we don’t need to have a constant workforce: getting our community plans done, or doing development through the Department of Public Works. During those times when development slows down, you’ll want to be able to bring down your workforce. But with permanent employees come 401Ks, 457s, retiree healthcare, and other retirement contributions. That’s a lot of money. We need that ability to flex up and down.

So I will support this plan in some areas. But in areas where the private sector can do the job, and do it at a competitive price—while paying fair wages, because that’s one of the issues that my colleagues always look at—I would argue that we’re better off partnering with them to make sure that we are able to perform and deliver.

I hope the board recognizes that it’s important to work with our labor partners, but it’s also important to protect them from themselves sometimes. If we have to do layoffs, it’s their union members who are getting laid off. I say that having run with labor’s support, in part because I always welcome them into my office to tell me where I’m doing wrong. Then I tell them where I’m doing right, and then we agree somewhere in the middle.

There are challenges ahead, but I’m excited and honored to work on them. Being a county supervisor was never on my radar as far as my career, but I’m thankful every day that I was elected, and I don’t forget where I came from.

I encourage you all to engage with the county. We need to do a better job reaching out to our business community, and I commit to you that this is one meeting of many. I’m looking forward to partnering with all of you to leave LA County better than how I found it.