LA’s ‘Secret’ Budget Meetings: The Questions No One is Willing to Ask

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LA WATCHDOG--While the combined budgets for the City Council and the Mayor are projected to be $100 million next year, will Paul Krekorian, the Chair of the City Council’s Budget and Finance Committee, conduct an open and transparent discussion of the individual line items of each budget so that Angelenos will have a better understanding as to how and where their money is being spent? 

For example, there has not been an open and transparent discussion about the Councilmembers’ discretionary funds that are reputed to haul in over $20 million a year, money that could be used to repair our streets or fund a portion of the City’s homeless initiative.  

Sources of cash for these slush funds include the Street Furniture Fund (advertising revenues from bus shelters), Oil Pipeline Franchise Fees, the Real Property Trust Fund (50% of the sale of surplus property in a Council District), and AB 1290 Funds (tax increment funds associated with the dissolution of the corrupt Community Redevelopment Agency).  There are also fees from Lopez Canyon Landfill, Sunshine Canyon Landfill, and the Central LA Recycling and Transfer Station that never see the light of day. 

Where the discretionary cash goes is also not very transparent unless you are willing to hire a team of forensic accountants.  Reportedly, Councilmembers use a portion of these slush funds to fund members of their bloated staffs. 

There are discrepancies between the number of positions listed in the budget for the Mayor (94) and the City Council (108) and internal rosters, telephone directories, and web sites which indicate over 450 employees.  Naturally, this gives rise to the question of how are all these staffers being paid and what is the source of the cash to fund the extra salaries, pensions, and benefits.  

This headcount does not include numerous City employees who are on “loan” to the Mayor’s office to work on special projects and initiatives or the many employees throughout the City who are on call to answer the many time consuming inquiries from the offices of the Mayor and the Councilmembers. 

The Mayor’s budget also includes a line item of $36 million for Non-Departmental Allocations that comprises two-thirds of his $54 million fully loaded budget.  But there are no details about how and where this money will be spent in the over 1,700 pages covering the budget.  

Nor is there any information about how last year’s $38 million of Non-Departmental Allocations was disbursed.  

The City Council has also budgeted $6 million for Non-Departmental Allocations.  While this represents only an eighth of its $47 million budget, again there is no information on where this cash is going.  

Tellingly, the budgets for the City Council and the Mayor were the only departments that did not have the Supporting Data that outlines the distribution of 2016-17 total cost of their programs.  This includes pensions and human resource benefits (equal 30% of total salaries for the combined departments) and other departmental expenses.  

The unwillingness of the Budget and Finance Committee to demand transparency from the Mayor and its own City Council is justification as to why the City should implement the recommendation of the LA 2020 Commission to establish an independent Office of Transparency and Accountability to oversee the finances of our cash strapped City, whose elected officials appear to be allergic to the sunshine demanded by skeptical Angelenos. 

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The Budget and Finance Committee should also consider another recommendation of the LA 2020 Commission by creating a Committee on Retirement Security to review and analyze the City’s two underfunded pension plans, especially in light of the projected $101 million deficit in 2020 caused by an increase of over $180 million in pension contributions, wiping out the $68 million surplus that was projected last year. 

 

(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee and a member of the Greater Wilshire Neighborhood Council.  Humphreville is the publisher of the Recycler Classifieds -- www.recycler.com. He can be reached at:  [email protected].)

-cw