Report 96018 Summary - March 1996

Los Angeles County


Balanced Budgets Will Be a Continuing Challenge

Los Angeles County produced balanced budgets in each of the last five fiscal years, after initially announcing shortfalls ranging from $277 million to $1.2 billion;

To balance its fiscal year 1995-96 budget by year end, the county needs federal approval of a $346 million health relief package, and departments must meet a 20 percent reduction in net county cost; and

Some of the causes for the fiscal crisis are:


Results in Brief

Los Angeles County (county) is one of California's original 27 counties and is responsible for providing public welfare, health, and public safety services to its citizens. Under the provisions of the California Government Code, Section 29088, the county must approve a balanced budget by August 30 of every fiscal year. In preparing its budgets for each fiscal year between 1991-92 and 1995-96, the county announced that it had budget shortfalls ranging from $277 million in fiscal year 1991-92 to $1.2 billion in fiscal year 1995-96. However, by the time it adopted a budget for each year, the county had produced a balanced budget through the use of layoffs, program curtailment, one-time financing to raise revenue, increased taxes and fees, and use of fund balance. Our review focused on the county's fiscal condition as well as the conditions and actions that have contributed to the budget shortfalls. Specifically, we noted the following:


To ensure achieving a balanced budget for the current and future fiscal years, the county should:

Agency Comments

The county generally agrees with our recommendations and is proceeding with efforts to implement them. In addition, the county concurs with the objective of achieving greater consistency in the authorizing of overtime among departments and will be working to ensure existing procedures and controls are more uniformly followed.

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