"DONE" Is Kaput

Yet almost bizarrely, Kim admits that within his department during his time as general manager, "No one reviewed any financial statements. It hasn't been set up to monitor or enforce."

The controller's audit revealed that a cowboy culture had been allowed to develop among many of the neighborhood councils. As Councilman Krekorian understates it, "There is a wide range of experience and professionalism within the neighborhood councils."

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More About

• Stephen Box
• BongHwan Kim
• Antonio Villaraigosa
• Politics
• Local Politics

In fact, 24 of the neighborhood councils are more than a year behind in submitting to DONE their basic quarterly paperwork documenting expenditures of taxpayer money. And 17 of those are more than a year behind.

Vocal DONE critic Simons' Empowerment Congress North neighborhood council has the highest number of delinquent reports: 13 quarterly reports were late, covering $59,366 in spending.

She tells the Weekly that since the audit, she has submitted six outstanding reports, that no report from her time as president is now late, and that the former president simply could not handle the job.

Rachel Capata, the group's secretary, says, "We're getting requests for audits that predate our board. It's a nightmare now. It's really hard to straighten out."

Collectively, neighborhood councils failed to account to DONE for $880,000 of taxpayer money they spent.

If previous spending reports are any guide, a lot of that was spent on food and snacks. But the controller's audit couldn't account for about 100 "equipment items" purchased by 14 neighborhood councils, and five councils were missing 27 gadgets bought with public funds, including "computers, [language-]translation machines, wireless microphones, ham radios and cameras."

Last year, LAPD investigated six neighborhood councils for suspicious financial activity, and in October, James Harris — the president of a council dubbed the Empowerment Congress Southwest Area Neighborhood Development — was indicted by a Los Angeles County grand jury for improperly spending $152,000 of public money.

In early February, Harris, a convicted felon, pleaded not guilty to five counts, including embezzlement and falsifying receipts and neighborhood council minutes. He is the fifth neighborhood council president to face criminal charges of misusing public funds.

Kim, who is likely to lose his entire department if the mayor's merger plan goes through, deflects blame. "I believed the system was broken from the beginning." He says that's why he asked City Controller Greuel to audit his department. "Publicly, we're saying the city wasn't doing its job, and neighborhood councils were skirting the rules, too."

Kim, who left a nonprofit in 2007 to head DONE, says he's made "short-term" fixes since Greuel's findings: His department no longer gives out petty cash to neighborhood councils, and as of February 12, if every box isn't filled out correctly on fiscal reports from the councils, Kim's staff returns the forms.

Now, activists like Box are trying to determine what can be salvaged, and whether the City Council budget debacle can be turned into an opportunity to strengthen the grassroots councils. As Box wrote on the CityWatch Web site a few days ago, "It is up to the community to rise to the occasion and to deliver a vision for Los Angeles."