Eddy Tanaka needed a job in 1958. The Walnut Grove, Calif., native had a college degree and a two-year Army stint under his belt when he came to Los Angeles, looking to find work with a local business.

But the economy was bad and jobs were scarce, so he signed on with the employer that was hiring -- the Los Angeles County government. The public-sector job was essentially a last resort, a place to start until better work came along. But 38 years later, Tanaka is just now getting around to leaving.

Tanaka is retiring this month after a county career spanning five decades, including the past 16 years as chief of the massive Department of Public Social Services (DPSS). He leaves behind an agency with a current budget of around $3.1 billion, 38 district offices, 10,000 employees and the tremendous challenge of serving the culturally diverse and constantly shifting LA community.

It is a challenge Tanaka met well during his tenure. Through lean economic and turbulent political times, he has managed the department cited most often by taxpayers as a prime example of governmental waste into a nationwide model. His businesslike attitude, tempered by the occasional joke at his own expense, has made him a popular department head in a city that often measures popularity by form rather than susbstance.

But his expertise has made him more than a local hero. In the past several years, Tanaka has also served as a voice for counties in the rational debate on welfare, testifying in Washington on behalf of local governments wary of federal proposals that would shift a greater percentage of welfare costs to cities and counties. And, in an election year when welfare reform is increasingly dominating the nation's political rhetoric, his expertise has also made Tanaka American City & County's County Leader of the Year for 1996.

Restoring Public Faith in Welfare Agencies is key

Tanaka started with DPSS as a social worker trainee in 1958 and moved up through the ranks, from deputy district director, head of budget services, division chief and deputy director of the agency.

Before he took over DPSS in 1980, Tanaka spent eight years in the county's Chief Administrative Office (CAO), where he eventually became head of the budget division, a title that gave him responsibility for analyzing and controlling the entire county budget. Twenty years ago, that was about a $3.4 billion concern.

Despite his early misgivings, government work has been good to Tanaka. After he first went to work for the county, Tanaka says that friends frequently urged him to move into the private sector, where the financial rewards were greater.

"Looking back now, a lot of those people have lost jobs," he says. "I've been fortunate. I've never been laid off. So in that sense, it's been steady employment."

But Tanaka's advancement to the head of DPSS and the innovations he has spearheaded show his work has meant more to him than just a reliable paycheck. While he does not brag about himself readily, it is quite easy to find others who will.

Barry Nidorf, the county's chief probation officer, has worked with Tanaka for the past 12 years. He developed a natural alliance with Tanaka, since both have led agencies that, despite large budgets, are often overshadowed by more powerful, visible county departments.

"He has been an unflappable administrator," Nidorf says. "He's got a great sense of humor, always good for a laugh. I'm going to miss him on both levels. I'm going to miss his friendship, as well as the stability and expertise he brings to the department chiefs. It won't be easy to replace him.

"There's just a wealth of knowledge there that's almost going to be impossible to replace," Nidorf says. "There's a lot of institutional memory that we'll lose when he leaves."

Tanaka claims no role as a campaigner on the social issues of welfare and poverty. He describes himself as much more an administrator trying to run an effective, businesslike agency. His principal mission has been simply to get the job done with the limited amount of resources available.

"I've not crusaded at all on some of the issues, and that has been a criticism levered by some segments," Tartaka says.

The attitude of operating government more like private business is a fundamental element of Tanaka's career, and his degree in business administration from the University of California at Berkeley has served him well in this regard.

"In an organization like this, I think that we need to look at it as if we're running a business," Tanaka says. "You've got to get beyond the pro' gram issues being the priority. You've got to learn to balance those services with the resources you have to work with. It's not very profound. You've got to learn to live with the resources you have, land! that's a difficult thing to do, especially in a political atmosphere where the bosses are elected by the people."

Keith Comrie, the top administrator for the city of Los Angeles, knows that difficulty well. He was DPSS chief in 1977 when he asked Tanaka to become his deputy director, and Tanaka took over the department three years later when Comrie left to work for the city.

"It's an amazingly difficult, controversial agency to run," Comrie says of DPSS. "It's pretty much an all-consuming job. I know that when I was there, you could literally live on an airplane. You never saw home except for the weekends."

Comrie says the challenge for Tanaka and his staff has been to keep DPSS operating effectively, while pushing at the same time for significant changes in its structure. He describes the task as being like "rebuilding an airplane in mid-air."

"Anybody who could do that for 16 years is a very capable person," Comrie says of Tanaka. "On top of all that, he's just a real good person to deal with. He's very good -with staff and community relations, and [his retirement! is a real loss to government."

Harry Hufford has known Tanaka since 1967, when Hufford was the deputy director of DPSS before he left to head up the CAO. Once there, he recruited Tanaka away from DPSS to work for him for eight yeas.

Hufford, now in the securities business, sees Tanaka as somewhat of a protege and takes great pride in his accomplishments. In putting Tanaka's endurance as DPSS chief in perspective, Hufford notes that at the CAO, for example, there have been four different directors in the past 16 years.

"I don't think that you will find too many major welfare chiefs who have lasted 16 years," concedes Tanaka, who balances the serious nature of his job with a self-deprecating sense of humor his colleagues find appealing. "The real reason is that I'm stupid."

Hufford, however, has other ideas about the reasons for his long-time friend's success.

"Eddy doesn't seek attention," he says. "He is the classic anonymous public official who takes pride in the work he does and doesn't seek a lot of public recognition. He's [also] a tough guy; he's got a lot of inner strength."

LA County, like most of the nation's local governments, has undergone downsizing, consolidation of services and other major changes, according to Hufford. Budget crunches, caused by the 1978 passage of Prop 13, one of the first taxpayer initiatives in the country, have left California's local governments scrambling to replace lost tax revenues.

"That put a severe crimp into the county's operating budget, so my tenure has really been governed by the county's inability to raise property taxes," Tanaka says. "It has been a struggle to get sufficient local funds to meet state and federal requirements."

"Somebody had to manage the departments through this [period], and Eddy was one of the first to inherit that role," Hufford says. "It is easier to manage growth. It's a hell of a lot tougher to manage this process that has been going on for the last 15 years.

"He has the respect, I'm sure, of each member of the county's board of supervisors, which is not easy to accomplish," Hufford says. "He could have been a more confrontational leader, but, frankly, I think it wouldn't have worked."

Tanaka's biggest crisis in a series of budget battles came last summer when the county was deciding its '95-'96 budget. Ordinarily, the county is required to ante up 25 percent of the administrative costs at DPSS to receive a 25 percent match from the state and another 50 percent from the federal government.

These costs were around $652 million for the '95-'96 fiscal year, according to Tanaka. Two-and-a-half billion dollars in assistance funds made up the remainder of the department's proposed budget.

When the county could not pay its share of the administrative costs, Tanaka was forced to issue layoff notices to 1,300 employees.

Upset for his employees and convinced that the layoffs would have been catastrophic for the county, Tanaka and others began lobbying the state legislature for relief. He argued that the department was already understaffed by 30 percent to 40 percent and that further cuts could create a dramatic increase in errors and undetected fraud.

Finally, a sympathetic legislator introduced a bill that allowed the county to pay only 10 percent of the costs while bumping the state is share up to 67 percent. Three days before the layoffs were to take effect, the bill was passed into law.

However, it was "totally a temporary solution," Tanaka says. "We were able to convince the same legislator to introduce a similar bill for the '96-'97 fiscal year, and we're beginning the same process, because we still can't come up with the match."

The county's limited ability to raise local revenues is, Tanaka believes, the primary reason for the department's ongoing budget crunch. But he also cites negative public attitudes toward the welfare system in general as an underlying problem.

Thus, restoring taxpayers' faith in this system is vital. If the perception of welfare agencies as being wasteful and plagued by fraud can be changed, better support and funding may eventually follow, Tanaka reasons.

"Currently, the image the country has [of welfare recipients] is that most of the people shouldn't be receiving assistance," he says. "If we can assure the public that we have weeded out those who shouldn't be receiving assistance, we could eliminate a lot of the antagonism toward the system."

Tanaka says he agrees there are too many people on welfare. In LA County, for example, about 1.8 million people, or almost 20 percent of the county's population of t0 million, currently receive public assistance, including cash payments, food stamps and/or medical benefits.

"Welfare reform is essential," he says. "The issue then becomes what [kind off welfare reform."

The key is to identify the core group of residents who are both eligible and truly in need of benefits, according to Tanaka. In working toward this goal, Tanaka has led some of the following efforts at DPSS:

* Fraud deterrence. In 1991, DPSS implemented a finger imaging system known as AFIRM in its General Relief (GR) program. The county distributes around $225 million in local funds through the GR program to those needy residents who are ineligible for state or federal assistance.

AFIRM aims to prevent "double dipping" into the welfare system. DPSS gave all recipients in 1991 one year to have their fingerprints stored in the on-line system, and began requiring all new applicants to be fingerprinted as well. Thus, anyone with fingerprints already in the system who attempts to sign up for duplicate benefits is quickly detected.

Tanaka says more than 3,000 of the 100,000 or so people who had been receiving GR assistance failed to come in for fingerprinting. Since these cases met all the requirements for aid, the department counts them as previously fraudulent recipients who were deterred by AFIRM.

The technology was fully implemented in the county's Aid to Families with Dependent Children (AFDC) program in 1993, and more than 8,000 cases have been similarly terminated, according to Tanaka. The department is also working for state and federal approval to expand AFIRM to its Food Stamps program, and Tanaka has tried to convince federal officials of the need for a national fingerimaging database.

"One of the things to remember about this is that, if the federal government were to implement time limits on public assistance, a system like this would be absolutely necessary to track people [who relocate!," he says;

* Automation and simplification. "There's a dearth of automatise in the welfare system," Tanaka says. "Why can't we look like a bank when people walk into our office?"

Tanaka and the department have thus worked more than 10 years for state and federal approval of LEADER, or the LA Eligibility,Auto' mated Determination, Evaluation and Reporting System. Once in place county-wide by 1999, the system will drastically upgrade the DPBS computer network and allow applications to be checked instantly, thereby simplifying and speeding up the application process. Tanaka says electronic payment of benefits and use of a single application for all welfare programs are also potential steps for making the department more efficient; and

* Work placement. Tanaka says DPSS has offered education and training, but has found many recipients prefer to go directly into employment when jobs are available. "Many of the AFDC people are wanting to work," he says. "Our emphasis has thus turned to getting those who are able to work into the workforce. It will work, but it's going to be expensive."

The expense will come in the form of benefits for child care and for medical coverage that the newly employed recipients had previously been getting through MediCal, the state's health care program for the impoverished.

In addition to these efforts, Tanaka calls for more "teeth" in child-support requirements as a means of cutting costs and improving welfare's image, since benefits to families with dependent children are by far the largest piece of the welfare pie. In LA County, AFDC payments for '95-'96 were about $2.2 billion out of an entire DPSS budget of $3.1 billion.

"I have consistently said that the major problem with the welfare population is that there are a lot of people who don't get the necessary child support," he says. "I think that if we can more strictly enforce child-support laws!, that would help. There are too many parents who are scot-free from supporting their children."

Besides high praise from his colleagues, Tanaka's leadership and demeanor have also earned the respect of his bosses on the county's board of supervisors. County supervisor Yvonne Brathwaite Burke, for example, says that Tanaka has "always enjoyed a good relationship with a very difficult group of supervisors, and he has their support."

Board Chairman Michael Antonovich has worked with Tanaka for 15 years end describes the departing welfare chief as "a man of highest quality and honesty and integrity. He's one of the best managers we have in the county [and] we would hope he will find a way to get back into the system, because those types of individuals are very rare."