Cloud of bankruptcy looms over the City of Los Angeles

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Los Angeles Mayor Antonio Villaraigosa faces hard questions and harder decisions because of the major budget crisis in L.A. Some of the decisions he has already made have many citizens and employees angry. Brian Baer / MCT

The city of Los Angeles is living beyond its means. Vital cuts needed to mitigate the city’s current and future financial crises are being stalled by high-salaried individuals with agendas of their own. Someone needs to step up and make the same unpopular and life-changing decisions many private industry executives had to make, leading to the 12.4 percent unemployment rate in California.

There are 15 city council members in LA and they are the highest paid city council members in the nation with monthly earnings of about $14,304 each, plus perks. Clearly some cuts can be made by reducing the staff and salaries of this 15-member panel. With the new L.A. term limits, a third term of the same leisurely approach is not cost effective.

Home values in Los Angeles continue to plummet and the recession continues to be a concern for many unemployed or underemployed individuals. Nevertheless, Mayor Antonio Villaraigosa and the Los Angeles City Council are continuing to drag their feet on crucial cuts needed to save the city’s budget. With talks of furloughs and salary cuts but no clear implementation of neither, someone should be impeached from office.

However, with the city desperately running out of money, options, and time, the hurry up and wait mentality demonstrated by Villaraigosa and the city council got a surge of energy a few weeks ago when the mayor announced department cuts and the first set of layoffs necessary to close the widening $485 million deficit.

One of the departments slated to be cut is the Human Services Department, which in 2008-2009 lost $2.3 million. The Environmental Affairs Department was the other department slated for cuts by the mayor.

Why is it so difficult to make cuts in light of this information? In fact, an in-depth report reflective of Villaraigosa’s plans to balance the budget was issued to council members in January by Miguel Santana, chief administrative officer. The report proposed eliminating the same departments Villaraigosa slated for cuts a few weeks ago, while preserving core services like police, fire, sanitation and traffic programs. But considering the urgency given to the report, this was just another example of the needless destruction of millions of trees.

Early this year, the city attorney raised questions about whether the mayor had the authority to order layoffs while the city council voted to delay layoffs 30 days — at their salaries, what’s the rush? Then, in a clear demonstration of the right hand totally ignorant of the left, the mayor had to check with his new lawyer only to determine that he does have the power, through his general manager, to order layoffs.

Now, to add insult to injury, cuts to police and fire departments are being threatened and, in yet another stall tactic, a study to determine cuts to ambulance service are pending, while Los Angeles County released more than 343 inmates early because of budget cuts. Great, it’s not enough that a major part of the public is in turmoil over the state of the economy, now this.

With the elimination of these two departments, 56 jobs will be cut, saving approximately $3.2 million. It cost the city $383,000 per day or four city positions while this budget is debated and the budget has been in limbo for about four months — do the math.

The mayor’s office staffs approximately 200 employees, with 10 Deputy Mayors among them earning more than $119,000 annually. Non-civil service positions make up the majority of the mayor’s staff whose salaries are more than their civil service counterparts. Instead of threatening cuts to police and fire departments, a major reduction in staff and salaries in the mayor’s own backyard is warranted.

According to the mayor, additional cuts to more departments are scheduled but if it takes as long as the infinitesimal cuts announced a few weeks ago, the likelihood of the city entering bankruptcy is plausible, regardless of how adamantly the mayor rejects the probability. More attention and swifter action should be given to the budget and less on camera time with Susan Lucci, Mr. Mayor.

It is a sad scenario when the City of Los Angeles cannot even raise funds to purchase the land near the world-famous Hollywood sign in order to prevent the cite from being developed into luxury homes. Pride evaporates like the budget in the City of Los Angeles.


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  • Elliot

    “…decisions in lieu of….” or “…decisions in light of….”? Calls the Sundial’s credibility into question when 8th grade vocabulary words are misused.

  • August

    And the county & city continues to pay $40,000-$60,000 a year per homeless family for a 8×10 room in a HORRIFYING EVANGELICAL PRISON-LIKE SHELTER where the children risk being sexually/mentally abused by the staff daily! ABSOLUTELY INSANE!

  • Munner413

    Edmund…. was your misguided rant an extra credit assignment given by your English teacher today?

    You’re trying to equate the salary of a business professional whos sole purpose is to make as much profit as possible from the sale of the service or product that they provide – with that of a public servant position.

    Tell me you misunderstood the issue here. Tell me what you wrote was a mistake…..

    Munner413

  • MJ

    You got to be kidding me….you have to over pay city workers to attract and retain talented workers?

    People who work for the city are people who are untalented and can’t get higher paying jobs in the private sector….

    Pay them what they are worth….which is about 50% less….

  • Munner413

    No mention was made of the unsustainable civil servant (aka: union) benefit & pension obligations.

    Union Welfare & dumbed down union members continue to rape our system, rape our kids, and rape the private sector.

    “Live Better (off the backs of others)- Work Union (don’t think, just be average, and don’t worry because someone else will pay your unfunded pensions obligations!)”

    Munner413

  • CT

    Why is this such a process? Just do what private industry does: unilaterally cut budgets 5% and let each manager figure out how to make do with less. Managers can either fire staff and/or reduce pay by 5% across the board. Most employees will take a small pay cut to stay fully employed. Then implement a 0.25% sales tax hike (one quarter of one percent). Oh, there will be wailing and gnashing of teeth, when such a tax increase is announced, but you know what? It will work with likely virtally no impact on retail activity. Why? because NOBODY is going to put back a $10 item that now costs $10.25.

    • CK

      CT, I agree, but those combined strategies will not close the gap. As Edmund says, upper-level salaries make up a very small portion of the budget. But I see no reason not to cut their salaries – most private corporate firms are doing the same if affected by economic strife. I think the city needs to thoroughly review what programs are working and which aren’t – not which ones lose money.

      BTW, CT: A $10.00 item already costs $11.00 in most of SoCal given a roughly averaged 10% sales tax. A 10.25% tax will take the $10.00 item to $11.03. A 0.25% sales tax alone on $10.00 item will take it to $10.03. You may want to work on your percents and decimal multiplication skills a bit.

  • Edmund

    The point is well taken–the city’s in trouble. But the focus on salaries is misguided. The salaries you cite make up a very small part of the budget. And city council members are paid much, much less than what they would make for similarly powerful positions in private firms. If you want a good government (like I do) you have to pay well enough to attract and retain talented people. The rule applies in government as everywhere else: you get what you pay for.

    • Jess

      By your logic LA should have talented and effective leadership from the city council. However they have dragged their feet and delayed making crucial decisions despite being advised years in advance of the deficit the city is now facing. They have been succesful in consistently voting pay raises for themselves to the point where they are the highest paid council in the nation with a salary on par with our governor’s. This is not to mention various perks, discretionary accounts, and additional $250k+ pensions some of the members receive from the city. It is this sort of aggressively self serving leadership that is emblematic of the greed that has crippled our economy. At least the highly paid executives you speak of promise and try to deliver record profits to their shareholders, ethics be damned. Are those the kind of people we want running our city?