Tue, May

Missing In Action: Mickey Kantor’s LA 2020 Commission


LA WATCHDOG: Mickey Kantor’s LA 2020 Commission was expected to release its first report on the facts surrounding the City’s unstable and overleveraged finances and its sputtering economy by July 4, three months after this group was formed to study the challenges and opportunities facing the City as it approaches 2020. 

But as of Labor Day, five months after the announcement of the LA 2020 Commission, we have not heard a peep out of this independent, blue ribbon commission, leading many concerned citizens to wonder if the downtown centric LA 2020 Commission has been co-opted by City Hall and its special interest, campaign funding cronies. 

Assuming LA 2020 releases its first report by end of September, we should expect its recommendations on how to stabilize the City’s finances, energize the economy, and create value added jobs by year end. 

While City Hall is telling us the worst is over because of an improving economy and the structural changes that have been implemented over the last several years, our City’s finances are still a huge mess. 

Over the next four years, the City is projecting a cumulative deficit of $350 million, including a deficit of $160 million next year.  But this assumes significant wage and benefit concessions from the City’s workers, which, based on past history, is a very aggressive assumption. Otherwise, the cumulative four year deficit will approach $800 million. 

Our City’s streets, curbs, sidewalks, trees, parks, and the rest of our failing infrastructure require an investment of more than $10 billion over the next ten years.  This is due to City Council’s decision to divert funds away from our infrastructure to finance the $1.4 billion increase in salaries, benefits, and pension contributions during the Villaraigosa era. 

The City’s two pension plans are also a major liability as they underfunded by $11.5 billion. However, if a more realistic investment rate assumption is used, the unfunded pension liability increases to $15 to $20 billion, implying a truly scary funded ratio of only 60%. 

The LA 2020 Commission’s review and analysis of the City’s financial condition and operations and its recommendations on how to stabilize the City’s finances are of critical importance to the City.  Over the years, the Budget and Finance Committee and the City Council have failed to develop long term solutions to stabilize the City’s finances.  Instead, they have continued to “kick the can down the road” to insolvency. 

As part of its efforts, the LA 2020 Commission needs to earn our trust and confidence since Angelenos do not respect the City Council.  This was evident in March when 55% of the voters rejected Proposition A, the permanent half cent increase in our sales tax.  

As a first step, LA 2020’s report needs to be perceived as independent from the corrupting influences of City Hall.  This would involve the release to the public of its findings at the same time it is delivered to our Elected Elite and the City Hall bureaucrats. 

The 13 members of the LA 2020 Commission must also establish a meaningful dialogue and relationship with concerned citizens.  This involves numerous outreach meetings throughout the City, including on week nights and weekends so that hard working men and women will have the opportunity to learn more about the financial condition of the City and the efficiency of its operations.  At the same time, commission members will get a better understanding of the goals of the voters and other concerned Angelenos.  

The LA 2020 Commission has an excellent opportunity to stabilize the City’s finances.  But it needs to maintain its independence and establish a relationship with the people of Los Angeles. 

Don’t blow it by being co-opted by City Hall and its campaign funding special interests.


(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee,  the Ratepayer Advocate for the Greater Wilshire Neighborhood Council, and a Neighborhood Council Budget Advocate. Humphreville is the publisher of the Recycler Classifieds -- www.recycler.com. He can be reached at:  [email protected]. Hear Jack every Tuesday morning at 6:20 on McIntyre in the Morning, KABC Radio 790.) 




Vol 11 Issue 71

Pub: Sept 3, 2013

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