A “new day” for First 5 LA

First 5 LA will soon bring programs like San Diego's successful eye-mobile to L.A. County.

It has been less than a year since Los Angeles County threatened to take over First 5 LA.

Created by voters to channel tobacco-tax revenues into programs for babies, toddlers and preschoolers, the independent agency had been accused of sitting on more than $800 million. A scathing audit had accused the organization of mismanagement and overstaffing. Meanwhile, much-needed initiatives for local kids were falling by the wayside.

What a difference nine months can make.

Last week, the commission overseeing First 5 here approved an accelerated plan to unleash nearly $400 million for services for the county’s littlest residents.

The plan, which is expected to serve up to 200,000 children countywide over the next five years, will almost immediately expand several existing programs and create some important new ones.

Among the new initiatives: a $25 million push to launch permanent supportive housing for homeless families with small children; a $40 million expansion of dental care for children age 5 and younger, and an innovative $4.1 million partnership with UCLA to bring mobile vision care to preschoolers starting in September.

Additionally, First 5 will spend more than $100 million to partner with the county on expanded programs to bring health insurance to low-income children and to address childhood obesity, parenting problems and substance abuse among parents of young children.

That money will be tied to multi-year agreements to ensure ongoing funding, and fast-tracked to the Department of Mental Health, the Department of Public Health and other partner agencies so that they can immediately qualify for funding matches.

“What’s impressive is not just the amount of money, but the speed, which is so important in light of the needs of our 0-5 kids,” says First 5 Chief Program Officer Antonio Gallardo. “First 5 used to be known for taking forever, but all these things are primed to be implemented in the next three to six months. That’s a 180-degree turnaround from the way we used to do business.”

First 5 was created in 1998, after California voters approved Proposition 10, a 50-cent tax on tobacco products that was championed by actor-director Rob Reiner. The money was to be locally administered and dedicated to child development programs for children aged 0-5.

Almost from the start, the tax generated immense sums. In most of the state, the revenues were administered directly by the counties. In Los Angeles, however, First 5 was overseen by a county-appointed commission and run by an independent agency.

Gallardo says that initially, the money piled up because it took several years to assess needs and to set up First 5 LA, the largest of the state’s 58 First 5 organizations. But when 2011 arrived with a local surplus approaching $1 billion, the untapped pots of money in Los Angeles and several other counties that had been slow to use their share of the funds became a tempting target for Gov. Jerry Brown, who’s been saddled with a huge budget deficit. He proposed diverting half of all the current and future Prop. 10 money into the state budget for children’s health.

The proposed diversion threatened to take about $450 million from First 5 LA’s swollen reserves, plus about $50 million into the future—a prospect that not only prompted a blizzard of lawsuits, but spurred Supervisor Michael D. Antonovich to ask Harvey M. Rose Associates to conduct the independent October audit.

The audit found no malfeasance, but was highly critical of the management under then-chief executive Evelyn Martinez, who had allegedly been so conservative with First 5 LA’s money and had operated with so little oversight by its commission that the organization was “at risk of not fulfilling its mission.”

“It was almost as if they were hoarding the money,” recalls Supervisor Zev Yaroslavsky, who, as this year’s chairman of the Board of Supervisors, automatically chairs the First 5 LA commission. “But the idea was not to have the biggest bank account in the county. It was to achieve the greatest positive outcomes for children who need help.”

Martinez resigned and general counsel Craig Steele took over as interim CEO in November after the Board threatened to strip First 5 LA of its independent status. Then in March, a court challenge invalidated the state’s claim to First 5’s revenues.

Now First 5 LA is searching for a new CEO. The new spending plan is expected to whittle the surplus to $122 million this fiscal year and $90 million by 2016.

Yaroslavsky, a longtime advocate for the homeless, says he is most excited about ambitious plans to jump-start housing and wraparound services for homeless children and their often-young parents, using a template that has been used successfully to house and treat other populations of street people, such as veterans and the chronically mentally ill.

“We have 3,000 kids in L.A. County below the age of 5 who are homeless, and that’s 3,000 too many,” he says.

But the supervisor also pointed with anticipation to a $4.1 million vision care program based on one that has been a remarkable success for the past decade in San Diego County, run by Dr. Stuart Brown, an ophthalmologist affiliated with both UCLA and UC San Diego. Brown says he expects to build on a small UCLA vision-mobile program to bring ongoing vision care to at least 20,000 preschoolers a year in this county.

“There’s plenty of money left, but we have moved a considerable amount out the door for programs and kids who need them,” says Yaroslavsky. “It’s a new day for First 5 LA.”