Plan To Shift State-County Services Still a Work in Progress

So far, only a couple health care programs are included in the Democrats’ proposal to restructure California government by moving some social services programs from state to county control. But that could change as stakeholders and the Legislature weigh in on the plan.

President Pro Tem Darrell Steinberg (D-Sacramento) offered the proposal as counterpoint to Republican Gov. Arnold Schwarzenegger’s (R) budget cuts. Steinberg said his plan could reduce the size and cost of state government and help narrow a budget gap of more than $19 billion by giving counties more responsibilities, as well as more money to pay for them.

“Through a multiyear restructuring of government, we can save billions of general fund dollars by moving programs off our books, while still giving counties secure and adequate funding to maintain the core services that protect communities and the most vulnerable in society,” Steinberg said when his plan was announced.

His initial proposal would affect just two health care programs: Adult Protective Services and a suite of community-based health-care services for seniors. Both programs are considered low budget.

County health officials are looking with cautious interest at the proposal, but they — along with many others involved in state politics — expect the plan to shift.  Other health care programs could be added to the mix before the proposal assumes its final shape, according to Farrah McDaid Ting, California State Association of Counties senior legislative analyst for health and human services.

“The whole restructuring program is in the early stages.  I think people are just now in the process of digesting this, and I think we’ll see other things pop up,” Ting said. “There’s a good possibility that as the Senate and interest groups discuss this, other programs could be added into the mix, including other health care programs.”

The California State Association of Counties has formed a working group to develop the organization’s response to the plan, a scenario probably occurring in other organizations as well.

“I know there will be lots of things on the table for discussion in our group so I can only imagine that’s happening all over the state,” Ting said.

Counties Association Supports Principles

Although Steinberg’s plan would shift many costs for public services onto county governments, the proposal includes new revenue and new ways to raise revenue. The Democrat’s proposals are a stark contrast from Schwarzenegger’s budget plan, which largely depends on deep cuts in spending and includes no new ways for government to generate revenue.

Under Steinberg’s plan, counties — and the state — would use money from a new tax on oil companies drilling in California, vehicle license fees, federal health care funds, a slice of sales tax and income from a delay of corporate tax breaks.

Paul McIntosh, executive director of the California State Association of Counties, and Jean Kinney Hurst, the organization’s legislative representative, praised Steinberg’s plans, but urged caution as well.

“We share your goal of preserving the critical safety net programs for our most vulnerable populations, and also share the belief that restructuring merits significant attention and effort,” they wrote in a letter to Steinberg. “We caution, however, that such an endeavor is a challenging one, particularly given the time constraints and political pressures associated with the 2010-11 budget negotiations.”

“In general, we agree with your principles,” the association officials wrote.

Cautionary Tale Offered

The association pointed to a health care program previously shifted from state to county control but without adequate funding.

“The example of In-Home Supportive Services is a great cautionary tale,” Ting said. “It’s a perfect example of how a legislative change down the road can make all the difference after a shift in responsibility.”

The state shifted IHSS oversight from state to counties almost 10 years ago. “A year after that, counties were required to do collective bargaining with IHSS providers and that was a big factor in costs going up,” Ting said.

In their letter to Steinberg, McIntosh and Hurst said, “In-Home Supportive Services (IHSS) is the prime example of a program that merely resembles the program it once was. IHSS costs have skyrocketed, in large part due to state law changes that failed to consider the implications of such changes on the funding of the program within the realignment construct. Securing appropriate and adequate funding for programs in which future changes may occur — whether by the Legislature, the federal government, or the courts — will be critical to counties as we continue these discussions.”

Counties Association ‘Institutionally Ambivalent’

Concerning the two health care programs included in Steinberg’s proposal, the California State Counties Association is “institutionally ambivalent” and “cautiously interested.”

On the shift of Adult Protective Services to counties, the association is “institutionally ambivalent,” Ting said. “APS is an important and growing program, but it’s not required by the federal government and has no stable funding source. It’s a very vulnerable program with money coming straight out of the general fund. If restructuring would give it a stable, dedicated funding source that would be a good thing,” Ting said.

“It’s a valuable program, and we would support its continued existence, but I’m not sure yet whether shifting it to the counties would cover all the costs,” Ting added.

On the community-based senior programs administered by a series of 33 state-funded Area Agencies on Aging, the association’s position is one of cautious optimism, Ting said.

“Those programs — brown bag lunches for seniors, Alzheimer’s programs, senior buddy programs, things like that — were essentially killed by budget cuts last year,” Ting said. “Now they’re popping back up as part of restructuring and if the money is really there, we think that would be great.

“There’s a bit of tension over how exactly it would work — whether these triple-A centers (Area Agencies on Aging) would get money directly or whether it would go through the counties — but those kinds of things could be worked out if the funding actually materialized,” Ting said.