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PPIC Issues Primer on State-Local Realignment

Needless to say, realigning the relationship between state and local government in California isn't going to be as easy, say, as realigning the tires on your car. Then again, at the rate things are going, there won't be any decent roads left on which to drive. So your car might not matter anymore. 

The Public Policy Institute of California has announced that it will publish a series of papers concerning the process and wisdom of realigning, per Gov. Jerry Brown's intentions in his 2011 budget proposal. The first report, Rethinking the State-Local Relationship: An Overview, was released in April. Authored by Dean Misczynski, it outlines the general principles of realignment and lays out some of the challenges that the state and its localities will face.

Under the governor's budget proposal, counties would take over responsibility for, among other funcitons, housing certain low level offenders and juvenile offenders; providing mental health, drug treatment, and child and adult protective services; and, of course, the elimination of redevelopment zones (but possibly not Enterprise Zones, per the governor's recent budget revise). Many of these services would be paid for by a temporary increase in vehicle license fees and sales tax, pending voter approval. 

The report outlines what it considers some of the factors that have prompted the need for realignment in the past, most notably Prop. 13, which deprived localities of the ability to raise money via certain property taxes and therefore tied their fates to the largesse of the state. 

Clearly, the success of realignment depends on implementation and not on any conceptual framework. Nevertheless, the report cites several benefits that may come from realignment: efficiency, better outcomes, and a balance between local control and statewide equity. This last point is the thorniest, however, since localities may become more free to provide, or ignore, services as they see fit. Therefore, funding and standards must, Misczynski, be put in place in order to ensure that localities do not go astray. Aside from the ethical obligation to provide for citizens equally, he notes that if services are not provided equitably, then residents might be compelled to move from poorly served areas to well served areas, thus creating undesirable migration patterns. 

Among the constraints that will complicate the realignment process are 1) the mandate to reimburse localities for new obligations; 2) Prop. 96's mandate that 45% of general fund monies go to schools; 3) Props. 1A and 22, which limit the uses of sales tax revenues and of monies related to redevelopment and transportation. And even if those hurdles are cleared, the report notes that the real devil may be in the financing details. Not surprisingly, the state will want to lowball the value of the services that it is delegating to localities, and localities will demand generous funding from the state. How far apart these numbers will be remains to be seen. But while money is fungible, facilities and expertise are not. In some cases, it could take years before localities built the capacity to take on all that will be asked of them. 

What all of this means, of course, is that realignment could go swimmingly and save millions of dollars. Or it could be a nightmare for local governments that already feel put-upon by the state. 

--Josh Stephens

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