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LA WATCHDOG - At Tuesday’s meeting of the Budget and Finance Committee of the Los Angeles City Council, the City Administrative Officer said that the 2025-26 budget will begin with a budget imbalance of $400 million unless corrective is taken. This shortfall will increase when there is an honest accounting for liability claims related to legal settlements and judgments, the impact of the wildfires, and required contributions to the depleted Reserve Fund.
Underlying this budget imbalance is that the charter mandated Revenue Estimate by Controller Mejia is about $300 million less than the overly optimistic projection in the Four-Year General Fund Budget Outlook. Also contributing to the $400 million shortfall is the impact of new labor agreements.
[Note: The CAO agrees with Controller’s budget estimate for 2025-26 of $7.8 billion. The previous estimate was $8.1 billion.]
Question: How do Mayor Bass, the CAO, and the Yaroslavsky led Budget and Finance Committee intend to overcome this budget imbalance that is estimated to be in the range of $500 to $700 million? And will this be done in a transparent manner that takes into consideration that City’s primary mission is public safety and the maintenance and repair of our infrastructure?
One area to investigate is the elimination of subsidies paid by the General Fund to support the operations of selected Special Funds. The includes raising our Solid Waste (Trash) Recovery Fee by a third to eliminate the $100 million subsidy from the General Fund and a 25% increase in the Street Lighting Maintenance Fee to cover its $17 million subsidy. The Planning Department could also raise its Planning and Land Use Fees.
But what are the other solutions? Will they impact public safety and the Police and Fire Departments whose ranks, motorized fleets and critical infrastructure have been neglected for years? And will our lunar cratered streets, cracked sidewalks, rundown parks and bathrooms, stressed libraries, and other areas of our critical infrastructure pay the price for the fiscal negligence of the Mayor and City Council? Will they propose to increase our taxes through parcel taxes or the issuance of bonds?
Over the next six weeks and prior to the Mayor’s submission of her Proposed Budget to the City Council on April 20th, there will be numerous closed-door meetings between the Mayor, members of the City Council, and the bosses of the public sector unions to determine the City’s priorities and allocation of scarce resources. But there will be little, if any, transparency where Angelenos can discuss their priorities.
Are we able to trust the Mayor, Yaroslavsky, and the rest of the City Council, the self-serving, fiscally negligent clowns who got us into this fiscal mess, to act in our best interests?
NO WAY.
(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee, the Budget and DWP representative for the Greater Wilshire Neighborhood Council, and a Neighborhood Council Budget Advocate. He can be reached at: [email protected].)
