- Written by Jack Humphreville
15 May 2012
LA WATCHDOG -On Friday, May 4, at the invitation of City Council’s Budget and Finance Committee, 12 representatives of the Coalition of LA City Unions made an unprecedented presentation to this committee in an attempt to avert the layoff of 231 City employees.
And while this informative two hour presentation was designed to provoke further dialogue and negotiations with the Mayor and the City Council, what was also interesting is what was not discussed on the floor of the City Council.
The well prepared union representatives rightfully claimed that the proposed layoffs would result in an even further lessening of City services. Even wannabe-mayor Controller Wendy Greuel intervened with a four minute speech saying that layoffs were not the solution, once again invoking her old standby line of waste, fraud, and abuse.
There was also the very valid discussion of how it makes little sense for the LAPD to replace 157 knowledgeable civilian workers with specialized expertise with higher paid, but inexperienced police officers, especially when those officers should be on the street.
The union representatives referenced their history of helping “balance” past budgets, whether through the elimination of almost 5,000 positions through early retirements and transfers to proprietary and special revenue departments, or through contract modifications that lowered the City’s projected contributions for pensions and health care.
But most of the two hour presentation focused on the Coalition’s ten solutions designed to provide the City with over $100 million in savings and revenues, more than enough to offset the $20 million “savings” from the proposed layoffs.
The most significant and intriguing solution, the “sweeping” of appropriated and encumbered but unspent funds from City departments would result in a cash infusion into the General Fund of $60 million.
Other solutions for the General Fund included the implementation of recommendations by the Commission on Revenue Efficiency ($10-$25 million), the more efficient collection of reimbursements for ambulance services ($11 million), borrowings to finance capital improvements ($7.5 million), lower contributions to the Reserve Fund ($9 million), and voluntary ambulance and first aid fees ($10 million).
However, and most importantly, there was no discussion about how to eliminate the Structural Deficit, where the City’s expenditures are growing faster than its revenues, where the average deficit over the following four years exceeds $250 million a year, and where the four year cumulative deficit is more than $1 billion.
And underlying the rapid increase in expenditures is the out of control escalation in salaries, medical benefits, and pension contributions.
During the profligate Villaraigosa era, personnel expense has increased by estimated $1.3 billion, where salaries (excluding overtime) have increased by almost 25% and benefits have increased by 50%. And when combined with the projected increases over the next four years, the total increase in salaries, benefits, pensions, and workers’ compensation will more than likely exceed a whopping $2 billion, crowding out most other programs, including the repair and maintenance of our streets and infrastructure.
Nor was there any conversation about the desperate need for money to repair our rapidly deteriorating infrastructure such as our streets, sidewalks, curbs, parks, buildings and facilities, street lights, and information technology systems.
Nor was there any discussion about the Early Retirement Incentive Program where 2,400 employees were offered over $350 million in retirement benefits plus another $30-50 million in cash to retire early, a total package approaching $170,000 per early retiree.
Nor was there any discussion about the shenanigans and gimmicks employed by the City to lower its contributions to its two pension plans that are already $10 billion underwater, and that is assuming overly optimistic investment returns.
Nor was there any discussion about interim budget solutions if the City fails to meet its overly aggressive revenue goals or the gimmicky solutions fail to generate the necessary cash.
But the utter lack of any concrete analysis and discussion about the Mayor’s Proposed Budget and the City’s pending insolvency is not surprising since the Mayor, City Council President Herb Wesson, and their cronies on the City Council have all agreed to “kick the can down the road” for another year so as not to upset the apple cart during an election year.
We have already seen some showboating by mayoral candidates Eric Garcetti and Wendy Greuel, but neither has offered any meaningful solutions to the City’s Structural Deficit or pending insolvency because those solutions would upset their Partners in Labor, the campaign funding unions.
Rather, we have seen the Coalition of LA City Unions flex their political muscles on the floor of the City Council as its dozen representatives made an “historic” two hour presentation to the members of the Budget and Finance Committee.
So who is representing us, the 99% who do not occupy City Hall, who have zero control over the City’s out of control spending, and who have to endure our lunar cratered streets?
And do you trust the Mayor and the members of the City Council who have been kissing the rings of the campaign funding unions?
Angelenos must demand that the City reform its finances by placing a charter amendment on the ballot that requires the City to “Live Within its Means,” where multiyear budgets are balanced based on Generally Accepted Accounting Principles, where our infrastructure is repaired and maintained, where our pension plans are funded, and where no new spending is authorized unless there is actual funding.
While it is unlikely that we can toss the fiscally irresponsible bums out of office given the financial muscle of the campaign funding unions, we can flex our muscles at the ballot box by rejecting any increases in taxes and fees.
Without real reform, the Mayor, the City Council, and the other City Hall ring kissers can say goodbye to any new taxes and fees.
Tags: Jack Humphreville, LA Watchdog, LA Unions, City Budget, City Council, Mayor Villaraigosa, LAPD, Wendy Greuel, Eric Garcetti, union campaign support, union campaign contributions
Vol 10 Issue 39
Pub: May 15, 2012