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Los Angeles: Broke and Broken
City Council clueless about vast, hidden costs in Villaraigosa's $6.9 billion budget
There are other massive, and equally stealth, expenses that are all but impossible to divine in Villaraigosa's citywide budget. And, again, the Mayor's Office budget for the next fiscal year echoes the larger budget's vagueness and obscureness.
The true cost of employing 32,267 city workers (there are 47,089, but 14,822 airport, port and utility workers fall outside the general fund) is one of those stealth costs.
ILLUSTRATION BY KYLE T. WEBSTER
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Three kinds of employee compensation — pension contributions, Medicare benefits and workers' free monthly healthcare premiums — add a hefty 40 percent on top of each worker's salary, according to City Administrative Officer Santana. The public rarely hears about that 40 percent when city salary costs are debated.
That 40 percent extra cost is left out of the "Total Department Budget" for every city department. It is instead obscured under the title of "Related and Indirect Costs."
When Villaraigosa states that "Mayoral Aide V" makes a salary of $56,000, the actual cost to taxpayers is $78,400 — the 40 percent in missing costs included.
As City Hall watchdog Humphreville notes, it's no small omission: "That is a real cost of doing business."
While most Angelenos pay a stiff out-of-pocket fee for their own monthly health coverage, the 32,267 who work for the City of L.A. get monthly healthcare insurance for free or at a dramatic discount. Those premiums cost Angelenos $6,800 to $10,000 per city employee each year, and are sapping tens of millions of dollars from core city services, from parks to street maintenance.
Los Angeles residents could use such knowledge to decide, at municipal election time, whether they're glad that the 15 council members and mayor spend city revenue on free health insurance instead of, for example, on aging infrastructure.
But the public never hears about that $6,800 to $10,000 per-employee figure. And in the mayor's budget for 2011-12, there's no clear explanation of this key freebie.
Yet another hidden practice is the mayor's habit of using employees from other city departments on "loan." City Controller Wendy Greuel confirms the practice, but cannot identify the names, job duties or size of this force of borrowed staffers.
When pressed, Greuel's office released this statement to the Weekly: "To institute greater controls, Controller Greuel is asking all city departments to provide a list of any and all staff on loan to other departments and offices and make this information available to the public."
Asked to comment on Greuel's request, Villaraigosa aide Hamilton did not reply.
L.A. City Councilman Paul Koretz, chairman of the personnel committee, apparently is comfortable with Villaraigosa borrowing city employees. Koretz's spokesman, Paul Neuman, claims, "City departments occasionally detail staff to the Mayor's Office to assist the Mayor's Office in understanding issues of concern to that department. I think that can be helpful to the mayor's ability to serve."
But Keith Comrie, the city administrative officer from 1979-1999 — who understands the totality of the city budget, as well as the details — describes the loaning of city employees to the Mayor's Office as "unusual" and problematic.
If such a practice is now OK, asks Comrie, then "why can't you move thousands of people from the Department of Sanitation to the DWP at any given time?"
According to Comrie, loaning employees to mayors Riordan and Tom Bradley rarely, if ever, happened during his two decades at City Hall.
As Comrie explains, the department heads in City Hall propose their annual budgets on the basis of the work required to provide specific public services. When the Mayor's Office borrows employees from other departments, manpower falls, public services may suffer and specific budgeted monies for a department are spent on employees working elsewhere.
How does all of this shake out? At the snapshot level, Villaraigosa is claiming for his own office this year that his "94" employees and other office expenses will cost $23.2 million, and that he's making an "11 percent cut" of $922,000.
In fact, his true office costs to pay his core staff's 173 salaries, pensions, free or discounted healthcare premiums, Medicare and other office expenses are about $36 million — more than 50 percent higher than claimed. More than $2.4 million of that will be paid by federal agencies and other outside grants. Adding in utilities, building services and other costs, the mayor's office actually costs about $42 million.
His claimed "11 percent" official budget cut of $922,000 from his own office thus turns out to be an almost unnoticeable trim of about 2 percent.
For Jay Handal, chairman of Neighborhood Council Budget Advocates, the questions raised by the mayor's personal office budget signal a greater problem: the economic problems facing the city, and Villaraigosa's and the City Council's handling of them. "We're in big trouble," he says. "All you have to do is look at [the recent report by the Budget Advocates], and it will tell you how much trouble we are in."
But where you stand depends on where you sit. Asked if the proposed city budget is problematic or incomprehensible, Villaraigosa spokeswoman Hamilton says, "It's fairly simple to understand. It's fairly straightforward." She adds: "The putting together of the budget has been a very transparent process."
Contact Patrick Range McDonald at pmcdonald@laweekly.com.
42 comments
you wanted a hispanic mayor regardlessit made you feel goodanother barrier brokennow own it and live with it
The thing that really jumped out... "Villaraigosa was thousands of miles away visiting Chicago and Washington, D.C., during most of the hearings." Like George Bush (vacationing in Crawford during much of his presidency), our mayor seems more interested in pursuing his interests than the interests of his constituents in Los Angeles.
Mr. McDonald,I am a retired City employee (sworn) and had the opportunity to review your article. I just wanted to say that in my 33-years as a City employee I have never read a newspaper article that was "right on" regarding the budgetary deception that goes on in City Council and the Mayor's Office. Without question, this Mayor has set a new record in citizen and budget deception. Thank you for the overdue exposure of corruption and betrayal of public trust. Rick
So Patrick Range MacDonald is having a hissy fit because city employees are getting health insurance. So, it's time for the question. Who provides a greater benefit to L A, Patrick Range Macdonald or a garbage collector? Los Angeles can get along very well without L A Weekly. How long would LA survive without trash collectors? So, don't garbage collectors deserve a decent salary and decent fringe benefits Lest we forget Martin Luther King died in Memphis because he was helping striking garbage collectors get collective bargaining. So before we cancel health care benefits for city employees, let's remember Martin Luther King.
Yes, insurance companies are robbing Angelenos blind. But let's not attack public employees for that. Let's go after insurance companies. A number of years ago Sheila Kuehl proposed a single payer health care system. UTLA conducted a study of Kuehl's proposal and concluded that LAUSD would save millions of dollars each year if California adopted a single payer system. UTLA went on record supporting a single payer system. This is an example of a unions supporting health care not only for themselves but for everyone else. That's a contrast to a lot of parents who send their children to charter and private schools as well as the educational reformers that infest LAUSD. They all want fringe benefits for themselves - but for teachers, or custodians - That's another story.
So if Patrick Range MacDonald is really upset about the health care benefits city employees enjoy, why doesn't he man up, at attack insurance companies, and not nurses' aides at L A County Hospital? That would show courage that LA Weekly no longer has.
P.s. As far as "investigative journalism", L A Weeky can't even get its facts right about Mozart's birth place, which was Salzburg - NOT Vienna, as L A Weekly would have us believe. With that in mid, how can we trust the facts presented by Patrick Range Macdonald??????
The article is not complaining about city workers getting benefits, it is about the hidden budget costs that are not being related truthfully. It is a complaint about what sounds like a corrupt mayor and his administration.
You're missing the point, which is good it's too difficult to get clear information about how people tax money is being spent. How do we hold people accountable if we don't know what's going on?
This kind of obfuscation as an obvious motive: the mayor and his cronies don't WANT to be held accountable. If they didn't feel guilty about what they are doing, they would uphold transparency in government.
LA Weekly, thank you for writing the article. We need more investigative pieces like this.
If financially competent persons do not run for city office, then perhaps we should break up the city into smaller cities. Disincorporate the entire city like they are proposing to do to Vernon. The corruption in LA city is far worse than Vernon.
According to L A Weekly, namely Mary Beth Crain, Mozart was born in Vienna. However, that's not true. Mozart was born in Salzburg.You can even visit his birth place. If we can't trust LA Weekly with something that every one who's seen Amadeus know, how can we trust L A Weekly with its stats on the amount of money LA spends on health insurace for its employees. I should remind Patrick Range Macdonald, that policemen and firemen risk their lives to protect him from danger. Don't they deserve health insurance? And how many Angelenos get health insurance through their employer? Shouldn't public employees have the same right? I do realize that many employers, like WalMart, don't provide their employees with decent health insurance coverage. However, rather than attacking policemen and firefighters, why not demand that WalMart permit its employees to form unions?Certainly Sam Walton can afford to pay his hired help decent wages and decent health care.Perhaps this is also a good reason for immigration reform - so that the uninsured undocumented immigrants who do the domestic work for the snotty mansion owners on the West side can get medical care. I know L A's unionized work force would agree.
Villaraigosa is going to be upset about this article! No one called him about it so he could pose for a picture!
Mayor Villaraigosa is a labor genius. He is firing 100 Travelers Aid volunteers at LAX on June 30th because it is too expensive to have volunteer labor at LAX.
Mayor Villaraigosa is a labor genius. He is firing 100 Travelers Aid volunteers at LAX on June 30th because it is too expensive to have volunteer labor at LAX.
Next question: remembering that Marisela Villar "worked" for Fabian Nunez, I would wonder how many of the people who "work" for Villaraigosa are family members of politicians. How many members of the mayor's staff are patronage appointees, and how many hold real jobs?
Great reporting -- much more important than the scandal in Bell, because this is routine, ongoing, and more expensive. I'd love to see you expand this kind of analysis to other cities in Los Angeles County, and to the massive county government.
Very nicely done.
if you get rid of the illegal aliens out there in California, you might get a balanced budget in a couple years. As long as you keep the illegal aliens, you NEVER balance a budget unless you double all the taxes. Think about it.
Terrific article. Keep digging and reporting and, just maybe, the dunderheaded voters will vote these criminals out of office. I moved out of LA the minute Villaraigosa was re-elected for a second term.
My once beloved LOS ANGELES one of the most beautiful cities on earth is now A MEXICAN CITY!Roadside vendors, pinatas, taco trucks, fish frying on stolen Supermarket carts, gang-banging, grafitti and Mexican flags are now the norm. WEEEEE! Isn't Mexico fun?
Deport all the illegals and take Mayor Villa Pendejo with them!
Wait, when hasn't there been such great diverse culture? Seriously. Relax and remember on whose original land you're standing on.
My folks were Minbreno Apaches from New Mexico. You mean that type of land?This was never Mexican land in our view! But we became friends with the Americans.
Don't be an idiot. No one cares about comments like this. You people infect every comment board and you appeal to no one but yourselves.
whats a matter? cant handle the truth. or you like LA looking like mexico. cause i agree. its a joke. i used to love LA. not anymore. only mexicans and rich people love LA.
We are in the United States and we have FREEDOM of SPEECH here!What bothers you is that I am waking up the American people!If you don't like what I say don't read my posts. But you will not shut me up Mexican!
Don't you hate that?
I care about his comment, you idiot. Are you illegal alien supporter? Apparently Mehican jackass population has been destroying once called USA, now no different from Mehico.
Americans secret weapon Red Cloud! American Natives!My folks were Mimbreno Apaches! These Mexicans want to take over so that there is only their type of speech allowed.Like the Cubans did to Florida.
You people? I suppose in your house the word "Mexican" is considered a swear word or racial slur. Another California cameltoe.
I can save the City an easy $500,000. EASY. Stop giving Channel 36 over a half million dollars a year. There is no need for the City to fund two television channels. It already spends over 3 million dollars a year operating the channel it owns (Channel 35). What is the justification for giving Channel 36 money? It has no control over it. It just hand them a gift of over a half million dollars a year. Don't take my word for it. Go to the Mayors budget and look under the ITA department and then Citywide Access Corporation. Two Mayors have tried to eliminate it but it always sneaks back in during the final weeks of budget negotiations.
Villaraigosa is a former City Councilman. These dogs protect their own. The corruption so deeply permeates our city government that it may never be completely eradicated, even as we spiral into greater debt. Villaraigosa makes much more money than he deserves, yet he seeks other folks' money to pay the fines with which he was recently hit for believing that he had a royal pass to all events in Los Angeles. He has access to enough slush funds that he can probably go on attending Oscars, Grammys, Laker games, Dodger games, pretty much whatever he wants and not a dime of his own salary will be spent on the tickets. He will leave office with a dandy pension (probably on top of whatever he gets for being the former Speaker of the State Assembly).
I would really like to say I'm proud to live in the second largest city in the country. But I live in a sewer, run by a bunch of filthy, slimy, corrupt democrats.
I am not proud to live in Los Angeles.
Because no media source has exposed the details of corruption within the system like the Weekly is now doing!
People should stop complaining about the corruption and incompetence. Angelenos re-elected every jerk that was running for office.
When voters re-elect councilmen who only cater to the millionaires and billionaires real estate developers, they have no business complaining about corruption and incompetence. The voters could have elected Stephen Box, but the LA Times nixed Box as he knew too much. And the voters fell for it -- LA Times said Box was a candidate knew all the "minutiae." Thus, we are stuck with jerks who are so lame that they don't even know that they know nothing about City Hall finances.
As long as they can give $52 Million to Billionaire Eli Broad, they' happy.
Villaraigosa has been a slime ball from day one. Is anyone shocked by this? He a typical politician - if his lips are moving, he's lying....
How about giving 100,000 a year Garbage Collectors the furlough time instead of Police and Firemen ????
So you're okay with your trash as well as your neighbors trash piling up in your front yard and in the streets for weeks at a time? If a Trash truck driver is making 100k a year that means he is working a lot of O.T., which means they are really understaffed. Besides, Sanitation generates their own monies and has nothing to do with Police and Fire.
It means we don't need him or her. The was a time when we could burn trashin our backyard incinerator. Before that people recycled their trash or tookit to the dump themselves. During WW2 we recycled everything. My householdchore was to put th grease can out on the parking curb to recycle the bacongrease into soap. I was 4 to 5 years old. If you live in the LA area it nowtakes 15 to 20 minutes to respond to a 911 call. Do you want it to go to 30minutes or more?? if you do I suggest you buy yourself a gun. 357 mag willdo.
100k is basically starting pay for police and fire along with full pensions at 20 years. maybe you should dispose of your own trash then let me hear you talk about furloughs
Grotesque and so obviously WRONG; these MULTI MILLIONAIRE "public servants" will NEVER stop, never be pried from the teat without the force of LAW.In the private sector they would be making little rocks from big ones in the hoosegow. THE PEOPLE KNOW and are righteously angered. EVERY Federal/State/City employee cannot be a MULTI-MILLION dollar worker - THIS MUST STOP.Somebody has to say the emperor has no clothes and charge these obfuscations with the criminal intent these people represent.Cripes.
Can you please name at least one (1) "Federal/State/City employee" who makes a million dollars a year and who is a "MULTI-MILLION dollar worker". I'm not talking about politicians who has their own personal/outside money, but some one who actually makes MULTI-MILLIONS of dollars working a civil service job.
Why is there not a criminal investigation into this? The city of Bell was just the tip of the iceberg. Every single one of these people from the Mayor of Los Angeles on down needs to be in jail. It's corruption on a massive scale.
Villaraigosa and his cronies are nothing but a bunch of greasy haired mobsters. Is anyone surprised by any of this?
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