Things Are Looking Up for L.A. City Budget, but $200 Million Deficit Looms
The city of Los Angeles, like the rest of the world, has been having money problems the last few years. So much so that some even predicted that City Hall could go bankrupt.
Maybe L.A. has turned a corner, because L.A. City Controller Wendy Greuel says things are looking up for the next fiscal year.
Greuel says that L.A. will see a massive ...
... 1.1 percent increase in revenues for the 2012-13 fiscal year that starts in July.
Okay, maybe things aren't that rosy. She says:
We need to be realistic about what an economic uptick means. Projections and revenues are down and recovery will take a long time. My job is to deal with both the problems that confront us today and in the future. Today, Los Angeles is facing a budget shortfall. There is no magic formula to balance the books, but I want to be clear: if the City comes up with gimmicks to balance the budget then the people of Los Angeles need to know about it. I strongly believe that it's time for our City to focus on long-term solutions that will get us back to fiscal solvency, because if we don't, Los Angeles' economic footing could be further jeopardized if the City continues to rely on excessive deferral of obligations and one time solutions.
Yeah. L.A. will still face a $200 million budget shortfall come July. That's actually not as bad as the $300-million-plus deficits seen in some recent years. And while that represents, like, half the annual income of Tyler Perry, remember that L.A. is bigger than some countries.
In any case, Greuel says City Hall should be prepared to see another $31.5 million fly out the window, cash that she says city officials guestimate they would have but in fact will not as a result of "the loss of the State's Vehicle Licensing Fee and a reduction in departmental receipts from licenses, permits and fees."
The good news is that property tax cash coming into City Hall will increase by nearly that amount next year: L.A. will see an extra $29.2 million.
Of course, it's going to take some hocus-pocus by the L.A. City Council to make $200 million in red ink go away. They're good at that though.
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