O.C. Budget With Added Cuts OKd : Bankruptcy: Supervisors approve spending plan that will slice county services nearly in half and trim the work force 12%.

By JODI WILGOREN

March 31, 1995 12 AM PT

TIMES STAFF WRITER

SANTA ANA — Slashing government even more severely than had been considered, the Orange County Board of Supervisors unanimously approved a budget Thursday that will slice county services nearly in half, chop the work force about 12% and trim the salaries of the county’s highest-paid employees.

Although the supervisors had approved $188 million in reductions to the county’s operations, county Chief Executive Officer William J. Popejoy asked for an additional $19 million in last-minute budget adjustments to create an emergency reserve fund.

The latest changes were given to department heads for the first time Wednesday, and the supervisors saw them on paper only five minutes before meeting to discuss them.

In presenting his latest budget, Popejoy also announced a new policy banning employees from taking the county’s 2,000-plus cars home after work without permission.

He also presented plans to study more huge cuts, including those that would consolidate the Sheriff-Coroner’s and Marshal’s departments and eliminate the county library system.

“The process has been painful and difficult. We will be a different county. The expectations of the citizens of this county will have to change,” board Chairman Gaddi H. Vasquez said during a daylong hearing on the latest round of cuts. “Today is an extraordinarily difficult day. It is unfortunate that it has to come to this.”

The revised budget presented Thursday reverses some of the most controversial cuts Popejoy proposed, keeping open the Joplin Youth Center and the Bowerman landfill, and reducing somewhat the massive number of layoffs that had been planned in the Social Services Agency.

But it also makes large new cuts in law enforcement, something that Sheriff-Coroner Brad Gates and Dist. Atty. Michael R. Capizzi said would further clog the criminal justice system and lead to an increase in crime.

“We’re at a point where you’re going to cut off the legs and cut out the hearts. We say that a lot--but we really mean it here,” said Gates, at times raising his voice and at times choking back tears during an hourlong presentation before the board.

“We absolutely can’t do it and still provide essential public safety services,” he said after the budget was approved. “I’m embarrassed to even be asked to make these kinds of cuts.”

The new budget--which Popejoy wants to put into effect within days--eliminates 1,590 positions, on top of the 433 jobs slashed in January. At the time of Orange County’s Dec. 6 bankruptcy filing, the largest by a government agency in U. S. history, the county had an authorized work force of 17,292 positions.

The 12% reduction will entail 718 new layoffs--fewer than the 1,040 forecast this month--the elimination of virtually all vacant positions, and a host of voluntary resignations and early retirements.

As of noon Thursday, 127 employees had signed up for the early retirement offer, but officials expected that number to climb to about 200 by the 5 p.m. deadline.

“Today, we come here and face another dark day,” said Nick Berardino of the Orange County Employees’ Assn., which represents most county workers. “County employees, who have been least responsible for the debacle, are now selected to pay the highest price.”

Under the latest plan, the general fund operating budget is $275 million, down from $462.5 million last year, but only $256 million is available for programs and personnel. That will form the basis for the 1995-96 budget, which must await final approval this summer, once the state completes its budget process.

Popejoy warned again Thursday that the number of layoffs would probably rise.

“These are bitter pills,” Popejoy told the board. “But we’re talking about what is necessary . . . to move the county forward on a plan that allows for a program of survival.”

Though the supervisors had asked Popejoy to restore more than $11 million in nine areas from the budget the CEO presented two weeks ago, the plan approved Thursday restored only $1.7 million from the supervisors’ suggestions, virtually all of it to keep Joplin open.

The $19-million reserve fund, presented for the first time Thursday, could be spent only with a four-fifths majority of the supervisors. It is intended as a cushion in the event that anticipated revenue falls short of expectations, bankruptcy-related expenses run higher than expected, or the county is forced to pay higher interest rates to bondholders this summer.

“We had a budget that was almost devoid of any reserve or contingency, and if there’s anything this county knows, it’s to expect the unexpected,” Popejoy said. “The purpose of this reserve is to anticipate future bumps in the road.”

Combined with $1.76 million already set aside for contingencies, the fund will be created with new general fund savings from nearly a dozen departments, including $4 million from the sheriff-coroner, $3.5 million from the Health Care Agency, $2 million from the district attorney’s office, and $3 million from the courts, with the court money to be replaced by revenue from the state.

In addition, Popejoy’s proposed salary cuts for about 280 of the county’s highest-paid administrators will add $1.7 million to the pot.

The salary proposal, which must be approved by U. S. Bankruptcy Court Judge John Ryan, would chop 10% from people who earn more than $120,000 a year; 7.5% from those that make $100,000 to $120,000, and 5% from those who collect between $75,000 and $100,000.

Employees who drive county cars or receive auto allowances, two practices Popejoy is ending, can absorb the salary reduction through the loss of those perks.

“These are people who probably make less money than their counterparts (in the private sector),” Popejoy said. “These are real sacrifices that may in many ways damage our effectiveness as a county.”

Gates also criticized the salary proposal.

“If you think this job is overpaid, line up, because in four years you’ll have a chance to take it,” Gates said, explaining later that he plans to run for reelection but invites any challengers. “I work hard for my salary. I believe I’m grossly underpaid.”

Earlier this month, Supervisor William G. Steiner took a 10% pay cut as part of his office’s shrunken budget. Supervisors Vasquez and Roger R. Stanton have vowed to reduce their salaries 5%, which they would be required to do now under Popejoy’s proposal.