Angelenos Deserve Budget Reform After Secret Labor Contracts Drain LA Finances

LA WATCHDOG - The major cause of the City’s financial crisis and the $1 billion budget imbalance are the budget busting labor contracts that were approved by the Mayor and City Council.  These deals were negotiated behind closed doors between the Executive Employee Relations Committee (see below) and the campaign funding union bosses and approved without any public hearings. This lack of transparency did not allow the public and the media to review and analyze these agreements that resulted in rivers of red ink. 

The Neighborhood Council Budget Advocates have proposed seven recommendations for reform, two of which involve negotiations with the City’s public sector unions. 

The first would require the City to conduct open and transparent labor negotiations by adopting a Civic Openness In Negotiations ordinance.  This may involve the use of experienced outside negotiators, an independent auditor to analyze the impact of any new labor agreements, the transparent discussion of offers and counter offers, the disclosure of private communications, and providing adequate time for the public and media to review and analyze the labor agreements and for public comment. 

The second recommendation is for the City Council to place a measure on the ballot that would prohibit the City from entering into any labor agreement that would create a current or future deficit.  In determining whether there is a deficit, potential revenues sources such as new taxes would not be considered unless they were already approved by the voters.  Importantly, the burden of proof will be on the City. 

These are easy to implement reforms if the Mayor and City Council would use their political capital and place transparency and the best interests of Angelenos ahead of the special interests of the campaign funding union bosses. We can no longer afford to give away the store to the public sector unions.  The City needs to stabilize its finances, live within its means, and deliver the efficient services to all Angelenos. 

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The five members of the Executive Employee Relations Committee are the Mayor and four members of the City Council, the President, the President Pro Tempore, and the chairs of the Personnel and Budget Committees.  

The following are the Neighborhood Council Budget Advocates seven recommendations for reform.  

1. The Four-Year General Fund Budget Outlook needs to be updated to reflect anticipated raises for City employees.  Personnel costs comprise about 75% of the City’s expenditures. This will give the Mayor and the City Council a better understanding of the City’s budget, finances, and its Structural Deficit.
2. Develop a two-year budget as recommended by the City Controller and the LA 2020 Commission.
3. Conduct open and transparent labor negotiations that require significant outreach to Angelenos before, during, and after the negotiations.
4. Place a measure on the ballot that would prohibit the City from entering into any labor agreement that would create a current or future deficit. In the short term, pass an ordinance. 
5. Develop a long-term infrastructure plan to address deferred maintenance and future capital expenditures.
6. Create a robust Reserve Fund that can only be used in declared emergencies, not to balance the budget as is the current procedure.
7. Establish an Office of Transparency and Accountability as recommended by the LA 2020 Commission to oversee the City’s budget and finances in real time. 

(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].)