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When Government FailsThe Orange County Bankruptcy$
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Mark Baldassare

Print publication date: 1998

Print ISBN-13: 9780520214859

Published to California Scholarship Online: March 2012

DOI: 10.1525/california/9780520214859.001.0001

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The California Context From Proposition 13 to Fiscal Crisis

The California Context From Proposition 13 to Fiscal Crisis

(p.61) Chapter 3 The California Context From Proposition 13 to Fiscal Crisis
When Government Fails

Mark Baldassare

University of California Press

Orange County does not exist in a vacuum. It is highly influenced by the trends that are occurring throughout California. Orange County's population and employment growth generally follow the statewide cycles. Its county government is also highly dependent upon the state government. Sacramento is a major source of funding, and it determines in large part the range of county services that are provided. Thus, fiscal changes at the state level have profound local impacts. This chapter reviews the California context before the Orange County bankruptcy. The story begins when Proposition 13 was passed by the state's voters in 1978. It continues over the next decade as the state government imposed new rules for counties in terms of their revenues, expenditures, investments, and programs. It ends in 1994 with the state in a severe economic recession and budget crisis. All of these state trends created conditions without which the Orange County fiscal crisis would not have occurred.

Keywords:   Orange County, California, bankruptcy, Proposition 13, revenues, expenditures, investments, economic recession, fiscal crisis

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