POLITICIANS SEEK FEDERAL PAYBACK ARNOLD CHALLENGED TO SECURE MORE STATE FUNDING FROM WASHINGTON.

Byline: David M. Drucker Staff Writer

Gov.-elect Arnold Schwarzenegger ran for office partly on his ability, as a fellow Republican, to work with President Bush to secure more federal funds for California, whose taxpayers send more money to Washington than they get back.

Leading Democrats are now pressing him to deliver.

In an Oct. 15 letter to Schwarzenegger, Assembly Speaker Herb J. Wesson recommended several ways for the governor-elect to make his mark as the ``collectinator,'' suggesting, as Schwarzenegger has, that California's status as a net-donor state makes it immediately deserving of additional federal funds.

But an examination of the state programs Wesson outlined showed that in many cases, Sacramento - not Washington - is responsible for what last year was a $58 billion disparity. In other instances, more federal money would fail to reduce California's state budget deficit.

Wesson, D-Los Angeles, did not respond to requests for comment; Schwarzenegger officials indicated he is studying the issue.

``There are a whole host of issues that are going to be a part of the dialogue the governor-elect will have with the White House and members of Congress, and we look forward to receiving additional advice from legislative leaders as this process goes forward,'' Schwarzenegger transition team spokesman H.D. Palmer said late last week.

California receives 77 cents in payments and services from Washington for every dollar in taxes it sends. Put another way, taxpayers paid the equivalent of $1,660 more in federal taxes last year for every man, woman and child than the state got back.

One reason is the hundreds of millions of dollars in penalties California taxpayers shell out each year because Sacramento has failed to meet federal requirements for automating its child support enforcement program, and because food stamps continue to be issued erroneously by the counties, which administer both programs.

In 1988, Congress passed the Family Support Act, mandating that states create a single, automated system to track and collect court-ordered child-support payments and locate parents who dodge their responsibility. According to a state audit released last month, California has made only two attempts in the last decade to comply with this law, and as a result will have paid almost $1.2 billion in penalties by 2006.

Additionally, taxpayers in 2003-04 will pay $114 million in penalties because of food-stamp errors.

This year, Sacramento signed an $801 million contract with the IBM Group to build a majority - though not all - of the required automated child-support system, and Wesson hopes Washington takes note of these ``great strides'' and waives future penalties.

Although the problem dates back to the administration of Davis' predecessor, Republican Pete Wilson, GOP critics blame the recalled Democrat for failing over the past five years to lead on this issue and devise a solution that would end penalty payments.

``(The Davis administration) failed to follow up on programs that were supposed to be enacted, until they realized they couldn't do it. What they then try to do is lay blame on counties,'' said Republican Assemblyman Bob Pacheco of Walnut, an ardent critic of the administration on this issue.

Other Republican officials in the Capitol indicate that Democratic lawmakers, who control the Legislature, could have pushed for a solution to this problem had they chosen to prioritize it.

In fiscal year 2003-04, Californians rank last in the per-capita allocation of federally funded state and local grants for homeland security. Of the $2.07 billion available, state residents receive just $4.68 each, as opposed to Wyoming residents, who rank first at $35.31 each.

After Wyoming, Washington, D.C., Vermont, North Dakota and Alaska round out the top five in this category, while in addition to California, Illinois, Florida, New York and Texas round out the bottom five.

Though superficially a case of unfairness, the imbalance is in part due to a host of factors, some complicated.

California has spent millions on homeland security that was not mandated by Washington. So while Gov. Gray Davis - and now Schwarzenegger - have a valid case to make that the Golden State has unique protection needs, the $750 million spent so far has mostly been at Sacramento's discretion.

The other problem, noted Davis administration spokesman Steve Maviglio, is that the current formula for homeland security funding is based on population, not the number of potential terrorist targets that exist in each state. Davis has worked with Homeland Security Secretary Tom Ridge to adjust the formula, but securing additional funds has been hampered in the interim by the burgeoning federal deficit.

``It's the same old story with all federal money: They have a bigger deficit than the states and don't have a lot of money to go out,'' Maviglio said.

Wesson said in his letter that California is shorted on federal transportation dollars. The state received $65 per person in funds in 2001, versus the national average of $97. A $1 billion increase would elevate the state to the national average.

But the existing difference is partly due to the fact that Sacramento in recent years has shifted state dollars marked for road projects to the general fund to help fill the budget deficit. Consequently, many such projects have been delayed, leaving fewer that are immediately eligible for federal matching funds.

Norm King, executive director of San Bernardino County's transportation agency, said the real problem stems from infrastructure fallout caused by the ports of Long Beach and Los Angeles. The goods unloaded there travel through California to points east, and benefit the rest of the country at the expense of local residents.

``You're dealing with major costs that are impacting us, but for which the federal government recognizes no responsibility,'' said King, of San Bernardino associated governments.

David M. Drucker, [phone]

david.drucker(at)dailybulletin.com