O.C.'s Carved-Up Budget Is Harbinger of Counties' Woes

County officials created a protocol office to welcome visiting dignitaries and supported the arts. They even spent money luring filmmakers.

But those days are over.

Last week the cash-strapped Board of Supervisors adopted $102 million in spending cuts for the coming fiscal year, which begins July 1.

Among other service cuts, that means the loss of hundreds of affordable-housing units; decreased health care for teens, pregnant women and drug abusers; increased institutionalization of foster children; and delays in assessing child-abuse cases.

"These cuts will affect individuals of all ages, from newborns to older adults," said Pat Markley, spokeswoman for the county Health Care Agency. "The cuts will be deep. And in many important areas, we will not be able to provide services for all those in need."

And that doesn't include the fallout of the state's projected $35-billion budget shortfall, which local officials predict will cost the county tens of millions of dollars more.

"The budget crisis that we're experiencing right now is the biggest obstacle in our financial planning since the Orange County bankruptcy," said Gary Burton, the county's chief financial officer. "There is a chance, if the state is not careful, they could bankrupt the county. And [we] would be one of the first ones that would fall."

Counties up and down the state face similar squeezes, beset by increased demand for services, higher pension costs and decreased revenue, said Jean Hurst, a legislative analyst with the California State Assn. of Counties. Orange County faces unique challenges because it still owes $881 million in bankruptcy debt, she noted.

The severity of Los Angeles County's budget woes won't be detailed until April, but Chief Administrative Officer David E. Janssen said officials are braced for "some pretty serious local-revenue problems as well

Orange County offers a preview of what other California counties face because it has required a five-year strategic plan, intended to balance county finances for five years, ever since the bankruptcy.