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Realignment: Coping or Capitalizing?

 

Both in my first post on realignment, and in the many conversations I’ve been having with folks from around the Bay Area and the state, I’ve been careful to present realignment as a transformational plan for the social safety net that presents both challenges and opportunities. As I’ve mentioned, the plan will ultimately give the local Supervisors who have always administered most social services in California new choices about how to allocate funding among the many programs that are being realigned from the Capitol to the counties.

In a nutshell, realignment transfers responsibility for dozens of social and health programs – foster care, adoption assistance, alcohol and drug treatment, protective services for the elderly, mental health, and some primary health for children – from  California’s legislature to the counties. Along with increased responsibility to administer and manage these programs, counties will get a dedicated share of sales taxes and vehicle license fees. They’ll also, very importantly, get increased flexibility about how to allocate resources among programs. The state legislature will step back rather completely.

Just a few years ago, the Governor’s Budget Summary for the programs included in realignment ran to dozens and dozens of pages. The May Revise this year? Three and a half pages. Next year, it will be zero pages – money will go straight to the counties, and it’ll be on them to figure out what to do with it.

The challenges arise from the fact that realignment is happening in a time of extraordinary scarcity – it doesn't look like there's enough money in the deal, so for the first few years at least, it will be local Boards of Supervisors rather than the legislature who have to figure out where to make cuts. Here in Alameda County, our Board often points out that the law requires us to balance our budget, whereas the state seems to have evolved a very sophisticated, if rather dull, set of strategies to only sort of balance its budget.

Furthermore, the programs included in realignment are not at all equal. Some are entitlements with legally enforceable protections provided by federal law, and some are not. Some optional programs match every county dollar with a federal dollar, giving them an advantage over programs that don't. Adding even more complexity, the rules attached to some federal dollars are highly proscriptive, whereas other federal dollars can be spent more flexibly. That is, there are places where Boards can cut and places where they cannot; places where the opportunity cost of cutting is much higher, and places where it is negligible. So regardless of the inherent or perceived value of a program to the community, legal, fiscal, and financial pressures may weigh just as heavily on any particular decision. This is the same set of complicated dynamics that the Legislature has been struggling with for years, and we’ve seen how that’s turned out.

However, because realignment dedicates a proportion of revenues to fund the included programs, rather than a specific number of dollars, as the economy grows so will the total pot. To put it another way, if California’s economy continues to improve, however slowly, so will available dollars that counties have to manage and invest in realigned social and health programs. This “growth” presents an opportunity.

On the somewhat less inspiring side, growth can be used as a corrective - to reverse some of the terrible cuts to essential services that the legislature and Governor have had to make in the past several years, or to counteract the accumulated effects of inflation. In Alameda County as in most places, neither public employees nor contracted service providers have had any adjustment to their pay to account for inflation since before the recession began. Here, as everywhere, retirement and healthcare costs for public employees have been growing at several times the rate of general inflation. 

On the much more inspiring side, growth could be used to build a better system of supports and services for those among us who are made vulnerable by illness or disability, by abuse, neglect, or exploitation, by addiction or simply age. New flexibility means new opportunities for counties to reprioritize investment towards important and effective programs, or to build new programs – to innovate and create and develop new approaches to addressing the many complex, interlocking problems that arise from and perpetuate poverty, that subvert aspirations and undermine self-actualization and success.

The past several years have been so tough for most Californians that we’ve gotten used to seeing the successful defense of the status quo as a victory – at least when it comes to budgets and finance. We should be careful not to let that kind of thinking undermine an understanding of what realignment could be used to do. Flexibility and growth are either preconditions or accelerators of innovation, likely both, and innovation is something that we very much need.  

I’ve disagreed with Governor Brown about a lot of things in the past couple years. But something he’s said that I absolutely agree with is that California’s ongoing fiscal and political crises demand that we engage in a big, broad, difficult conversation about how we, collectively, want to shape and build our society. Realignment is, at its root, part of a solution to our budget woes and the political logjam in Sacramento. That said, it absolutely creates an opportunity, and I would argue a responsibility, for Californians to enter that broader conversation, and to think about how we collectively want to provide for our most vulnerable. 

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