Budget Impasse Wreaks Havoc

If Sacramento politicians are unable to quickly figure out how to begin offsetting the state’s estimated $42 billion deficit through June 2010-a struggle Gov. Arnold Schwarzenegger called the state’s financial “Armageddon”-the brakes could be put on the Highway 101 expansion project; county services, already hit hard by deficits, could be hit even harder.

Just one of several consequences of the budget impasse-which is predicted to drain the state of money by next month-is the temporary halt of funding for 39 statewide Proposition 1B highway projects. One of those is the $53 million expansion project planned for both northbound and southbound lanes of Highway 101 between the Milpas Street and Hot Springs Road exits.

The Santa Barbara County Association of Governments (SBCAG), which secured the state funding for the Highway 101 project, is looking at ways to continue the work. Though SBCAG has commitments to other projects, the agency could loan roughly $2 million to $3 million of its money to the state to keep the project going for another month. The contractor, Security Paving of Sun Valley, California, was most recently paid on January 9, according to Caltrans spokesperson Jim Shivers. “We hope to keep the project moving forward,” Shivers said.

But a temporary halt to the project remains a possibility that, if realized, could lead to unfinished construction along this major thoroughfare and additional associated costs. For example, unbudgeted demobilizing and remobilizing costs-that is, purchasing materials and transporting equipment-would add to the headache. And then there are the people doing the work. “We’d have to tell 1,000 workers they have to go home here in the middle of a recession,” SBCAG deputy director Stephen VanDenburgh said. “It’s not an ideal situation.”

Problematic though the situation might be, it’s one being faced now by Santa Barbara County residents. The formerly employed are heading to the county’s Social Services Department in unprecedented numbers. And now that unemployment is going up, the department is one of several county agencies struggling with cuts when the people who benefit from its programs are most in need of them.

The county is seeing its highest number of food stamp cases on record, up about 18 percent from a year ago. But Social Services is backlogged by more than a month in applications for food stamps, Cal Works, and other benefits, explained the department’s director, Kathy Gallagher. The chief cause of this, Gallagher said, is an increase in applicants. With an unemployment rate of 6.3 percent-more than 1.5 percent worse than it was a year ago-more and more people are coming to her department for help.

The department has a hiring freeze in place with 46 total vacancies not being filled, of that number, about 18 in the benefit program. More than 3,000 county employees-Social Service workers included-also participated in a cost-cutting two-week furlough, saving the county upward of $10 million, but also leaving a bundle of cases to work on when they returned in early January.

Also not helping is the state decision to cut funding but not reduce some legally mandated requirements for certain services, thus shifting an additional burden to county governments.

Local agencies are anxiously waiting to see what sort of budget Sacramento passes, and the suspention of Prop. 1B has interrupted current projects statewide; while the looming ’09-’10 budget crisis will inevitably have the long-term effect officials are dreading.

“That’s the big one,” said Jerry Estrada, assistant general manager of the Metropolitan Transit District (MTD), which was counting on $1.4 million in suspended Prop. 1B money to go toward replacing seven 17-year-old buses. Of even bigger concern to Estrada, however, is the potential elimination of the state’s Transit Assistance Program in the next fiscal year. Already cut once this year and facing further cuts depending on what happens in the next few weeks, the program is the only source of capital funding for MTD.