$1.4 Billion In LA Budget Deficits: Labor Reform a Must!

LA WATCHDOG--On June 30, the City budget was balanced.  The City was also projecting a budget surplus in each of the next four years, topping out at $78 million in 2024. 


But now, as the result new labor agreements with the police, firefighters and selected civilian unions that were negotiated behind closed doors and ramrodded through the City Council without any discussion or meaningful information, the City is looking at a budget deficit of $200 million.  

In addition, over the next four years, the City is projecting a torrent of red ink with deficits ranging from $200 to $400 million a year, a four-year total of an estimated $1.2 billion.  

This hijacking of the City’s treasury after only two months into the fiscal year is unacceptable, especially since Mayor Garcetti, City Council President and wannabe County Supervisor Herb Wesson, and Councilmen Paul Koretz and Paul Kerkorian knew of the devastating impact of these new labor contracts before the final budget was approved by the City Council and the Mayor. 

What is also unacceptable is the utter lack of transparency that continues to this day. 

Rather than getting bushwhacked again by the Mayor, the City Council, and the City’s public sector unions like we were in 2007, 2015, and 2017 (DWP), Angelenos should demand that the City adopt a policy of open and transparent labor negotiations, similar to the COIN (Civic Openness in Negotiations) programs that has been adopted in other jurisdictions.    

This may involve a discussion of the City’s goals at the beginning of negotiations, the disclosure of offers and counter offers by the parties, an independent analysis of the fiscal impact of any labor agreement, the disclosure of any private communications, and adequate time (30 days) for public review, analysis, and comment. 

As a matter of interest, the Los Angeles Times endorsed increased transparency in labor negotiations in an editorial on September 1, 2015 entitled, Los Angeles Could Use More COIN .  

The City should also adopt a policy that it will not enter into any new labor agreements that will result in an actual or projected budget deficit.  No more budget busting labor agreements where we get slammed today with $200 million of red ink and $1.2 billion in future deficits.  

The City should also begin to benchmark the efficiency of its operations, similar to what is being done at the Department of Water and Power, an effort endorsed by the politically appointed Board of Commissioners and the City Council.  

At the same time, the City’s public sector unions should be required to disclose in real time any contributions, behests, or other benefits they have made to any elected official in the City, County, or State. They should also be required to detail any meetings they have had with any City officials, elected or not elected, over the previous two years. Likewise, the same disclosure and transparency requirements would apply to the Mayor, the City Council, and their staffs. 

The public sector unions will obviously resist any efforts at transparency because they have been able to negotiate very generous contracts behind closed doors.  In Orange County, the unions refused to enter into negotiations claiming that transparency was trampling on workers’ rights.  The State Legislature even passed SB 371 in 2015 that placed onerous disclosure requirements on cities and counties who had passed COIN laws. 

But what about our rights?  We are the ones footing the bill as Mayor Garcetti and Councilmen Wesson, Koretz, and Krekorian sold out to the unions and gave away the store.  LA and all Angelenos could definitely use more COIN to protect their wallets. 

(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee and is the Budget and DWP representative for the Greater Wilshire Neighborhood Council.  He is a Neighborhood Council Budget Advocate.  He can be reached at:  lajack@gmail.com.)