State must make changes, controller says

If California wants to survive the latest financial mess, the government and residents must be held accountable, said John Chiang, California's controller.

Chiang, who's been the state's chief fiscal officer for almost two years, spoke at the Ventura County Taxpayers Association's annual meeting last month at Las Posas Country Club in Camarillo.

Chiang said the state is "financially mismanaged" and that dramatic changes are needed.

"There are huge challenges that face each and every single one of us," Chiang said, "especially if we're going to be responsible for future generations of Californians and Americans. One thing we have to do is get our fiscal house in order."

The controller also discussed why he and Gov. Arnold Schwarzenegger are being held in contempt of court by U.S. Judge Thelton Henderson.

Schwarzenegger and Chiang have withheld a $250-million payment to Henderson and Receiver J. Clark Kelso, who want that money to start an $8-billion prison hospital project. Kelso has been appointed by Henderson to improve healthcare for prisoners up to constitutional standards by building seven medical facilities for prisoners, including one at the Ventura Youth Correctional Facility on Wright Road just outside Camarillo.

"I think it's important to know what we spend that money on," Chiang said. "We can't just go say, if you need it, take it—unless a higher court says so."

Dr. Albert Reeves, who participated in the recent opening of the Las Posas Family Medical Group's clinic, thinks the medical facility would deplete the county's healthcare resources.

"This prison would have a significant negative effect on healthcare in our county," Reeves said. "We can't compete with what the state pays for doctors, nurses, therapists, Xray technicians. . . . We're going to lose a lot of these people."

Chiang spent much of the time talking about California's economic plight.

Although California has the world's eighth-largest economy, it is the lowest credit-rated state in the nation. Part of the problem is that the state passes ballot measures which it can't afford, Chiang said. About 53 percent to 54 percent of the state's budget is tied to education expenses; 25 percent for healthcare and social services; and 9 to 10 percent for corrections, leaving little flexiblilty in the budget.

Chiang also said that the nation's energy crisis is far from over, even with the recent drop in gasoline prices. That's because about 100 million people in India and 300 to 400 million people in China—more than the entire population of the U.S.—are moving into the middle class, and that will cause a greater demand for vehicles and fuel.

"We understand that long-term energy costs are going to increase," Chiang said. He went on to say that Americans need to expand green technology, perhaps inventing or harnessing other forms of energy.

Chiang discussed how he has revamped the way the controller handles taxpayers' money. On the 10th of every month, Chiang discloses the state's cash flow and tax revenue numbers to the public on his website. That openness didn't sit well with the governor or others in Sacramento.

The controller has also prioritized returning unclaimed property back to Californians. According to Chiang, one out of four households in the state that qualified for income tax credit didn't collect their money—about $850 million. People can find out if they have unclaimed property by visiting www.sco.ca.gov, and clicking on "Search for Unclaimed Property." The state is holding more than $5 billion from 8 million accounts.

The discussion ultimately returned to the prison hospital issue that will affect Camarillo and Ventura County.

Kathi Miller of the Prison Hospital Action Committee and District Attorney Greg Totten of Taxpayers for a Safe Ventura County, asked Chiang questions regarding the controller's role in the fight against Kelso. Both organizations oppose construction of the prison hospital and are considering legal action.

Chiang would like to see the formation of a citizens' oversight committee that would watch over Kelso. "If we make decisions that have community impacts and statewide impacts, there should be a process—instead of somebody just imposing their will without understanding those consequences—to get people involved," he said.

Miller was pleased that Chiang made the time to visit and speak to Ventura County residents.

"We haven't had the receiver come down and do that," Miller said. "Overall, I was happy to hear him talk about oversight and transparency in regard to how taxpayer money is being spent."