County Ready to Enact Hike in Aid Payments : Welfare: General relief payouts would rise to $341 a month. The move would settle a city lawsuit.

Los Angeles County supervisors today are set to act on a proposal that would raise general relief payments for thousands of homeless to $341 a month, from $312, and settle a court fight that has cost taxpayers about $5 million in legal fees.

The settlement would force the board to squeeze another $38 million a year out of a tight $11.1-billion county budget to pay for higher welfare costs, Chief Administrative Officer Richard B. Dixon said Monday.

The proposed settlement will be presented today to the supervisors and to the Los Angeles City Council in separate closed-door sessions. The city in 1987 filed suit against the county, accusing it of abdicating its responsibility to care for the poor.

If approved as expected by the board’s new liberal majority, the settlement would end the litigation, during which the county paid private attorneys up to $325 an hour.

“We finally have a board majority that is willing to pay more per month to assist the homeless than it was paying per hour to law firms,� said attorney Mark Rosenbaum of the American Civil Liberties Union, one of a number of legal aid groups that joined the suit against the county.

The proposed settlement also calls for the county to pay nearly $1 million in attorneys’ fees to the plaintiffs.

Supervisor Ed Edelman, a prime mover behind the proposed settlement, said he is “cautiously optimistic� that it will be approved.

Newly elected Supervisor Gloria Molina joined fellow liberals Edelman and Kenneth Hahn in March in authorizing settlement negotiations.

Conservatives who had controlled the board had refused since July, 1988, to increase general relief paid to 58,000 people, mostly homeless, who do not qualify for other types of aid.

In a countersuit against the city, the board accused Los Angeles of exacerbating the homeless problem by demolishing low-rent housing, especially on Skid Row.

Attorneys for the city and legal aid groups argued that the $312 a month is inadequate to pay for basic needs, such as clothing, food, housing and transportation. General relief recipients also receive $70 to $80 a month in food stamps, according to county welfare director Eddy Tanaka.

Under the proposed settlement, the general relief payment will go up at the same rate as increases in the state-run Aid to Families With Dependent Children program. The general relief payment will not be decreased, even if the state Legislature approves Gov. Pete Wilson’s proposal to reduce grants to families this year, according to sources familiar with the proposed settlement.

Edelman declined to discuss details of the settlement before today’s meeting. He said he would wait until today to comment on where the supervisors, who are facing $66 million in proposed budget cuts, hope to obtain the additional $38 million to pay for the increase.

Dixon said the board has $30 million not yet earmarked for specific programs. Supervisors this week are holding budget hearings and must sign a budget by July 15.

Los Angeles County now ranks 35th among the state’s 58 counties in general relief payments. At $341 a month, Los Angeles County would be tied for seventh with 20 other counties, including Orange and San Francisco. Top-ranked Humboldt County pays $391 a month.

Gary Blasi, a lawyer with the Legal Aid Foundation of Los Angeles, said the settlement, if approved, will mark a “turning point in the relationship between the county board and poor people.�

The proposed settlement calls for a number of reforms in the general relief program. It would allow recipients to take classes in English as a second language to improve their ability to get jobs, “as opposed to picking up paper� on freeways, Blasi said.