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Mr. CityWatch Visits NoHo Arts District

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LA’s Controller Silent on Mayor’s Proposed Use of Measure R Funds

PERSPECTIVE - When you have a City Controller who feeds from the same trough as the mayor, it should not come as a surprise she would overlook an attempt by Hizzoner to direct monies away from a voter-approved fund to expand transit, for a purpose that should be covered by ongoing operating revenues.

Villaraigosa wants to use the fund to cover the cost of street repaving. Street improvements and repairs are allowable uses, but a far cry from the sales pitch used to promote Measure R in November 2008.

Supporters of the measure, which added a half-cent increase to the county sales tax, emphasized shiny new subways and other rail projects.  They are easier to hype than mundane repairs – repairs that should have been addressed over the years from the general fund were it not for irresponsible financial management by our elected officials.

There was no meaningful public discussion of prioritizing uses of the additional sales tax revenue during the campaign, and we are talking about a lot of money.

You would think that officials charged with the responsibility of keeping watch of the financial health of the city would weigh in on potentially large commitments against our future infrastructure needs. But Controller Wendy Greuel may as well have zipped her mouth closed. Why would she want to ruffle Villaraigosa’s feathers when she may need his support to succeed him as the mayor?

MTA chief Art Leahy recently warned that Measure R revenues have declined and may be $4- to $6-billion less than the original $40-billion estimated.

That decline threatens rail projects such as the Crenshaw/LAX line and who knows what impact it will have on the Subway-to-the-Sea, which could cost $9 billion. It is conceivable that the project would have to be scaled back, further reducing what some say are optimistic assessments of its benefits.

The City of Los Angeles’ share of Measure R is $2-billion, which may also be at risk if revenues do not dramatically improve. A smaller pie means smaller pieces.

The mayor wants to borrow $800-million from this share, [link] plus incur $600-million in borrowing costs, to repair 1,500 miles of streets. If the proposal is approved, it will effectively wipe out most – maybe all – of the $2-billion, depending on developments in the economy.

Think of it as spending money on waxing your clunker of a car instead of buying a new one.

In any well run organization, repairs and maintenance are funded from ongoing revenues derived from normal operations, not by mortgaging the future in a manner that could curtail important capital spending down the line.

Just as he did by deferring the payment of police overtime and stretching out the costs of the ill-conceived Early Retirement Incentive Program, Mayor Villaraigosa has a penchant for living for today with tomorrow’s dollars.  He has a willing accomplice in Wendy Greuel.

Think back to 2008 when our city had a controller who was not afraid to challenge the mayor’s deceptive use of a new trash fee hike, the purpose of which was to add 1,000 officers to the LAPD’s ranks.  Over half the revenue went to support ongoing operations; only 366 officers were hired.

Laura Chick criticized Mayor Villaraigosa [link] for not being straightforward with the voters when he campaigned for the fee hike.  She concluded that the voters had a reasonable expectation that the additional revenues would go towards direct hiring of new officers, not to cover existing commitments.

Will Wendy Greuel show the same spine?

I think not.

(Paul Hatfield is a CPA and serves as Treasurer for the Neighborhood Council Valley Village.  He blogs at Village to Village, contributes to CityWatch and can be reached at: ) –cw

Tags: Measure R, Mayor’s Road Works Plan, Mayor Villaraigosa, Art Leahy, Los Angeles, Wendy Greuel, Laura Chick, MTA

Vol 9 Issue 93
Pub: Nov 22, 2011