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Los Angeles City Council Committee Reviews the City’s Financial Health in Light of COVID-19


Last Monday, May 11th the Los Angeles City Council’s Budget and Finance Committee gathered virtually to review reports from the City Administrative Officer (CAO), the Chief Legislative Analyst (CLA), and the Office of Finance.  Their reports concerned the state of the city’s financial health as it ends fiscal year 2019-2020 (on June 30) and approaches fiscal year 2020-2021 (which begins on July 1).

In light of COVID-19 and the uncertain future we face in its wake, Committee Chair Paul Krekorian (CD 2) began the five-hour meeting with full transparency that the budget is likely to be revised well into the next fiscal year.

“It is a fluid and challenging and difficult situation…this is an ongoing process, and whatever happens between now and June 30th is only slightly relevant to the work that we’re going to have to keep doing for the next 12 months,” Krekorian said in his remarks.

Budget and Finance Committee members are responsible for approving and recommending budget changes; City Council will meet this Thursday, May 21, to review the Mayor’s proposed budget, but any motions pertaining to budget changes will be redirected back to the Budget and  Finance Committee for approval and consideration.

As of April 11th, the city has spent $44.4 million in COVID-related expenses. These expenditures have included:

  • A new small business loan program.
  • Increased hygiene services for homeless populations, including both hand washing stations and access to restrooms for street populations.
  • 24 new temporary homeless shelters in Recreation and Parks facilities.
  • Funding for 8,000 hotel rooms for homeless Los Angeles residents (15,000 have been funded County-wide).
  • Expanded testing sites (there are now eight, citywide).
  • The transformation of the Los Angeles Convention Center to a medical surge facility.
  • Purchases of protective gear for the city workforce.
  • The distribution of protective gear to homeless residents.
  • Food delivery services for seniors.
  • Funding for eight Recreation and Parks facilities that run childcare services for public health and public safety first responders.

Of the $44.4 million in expenses, up to 75% of the rental assistance and business assistance funding categories are eligible for reimbursement from FEMA.

As the City initiated its response to COVID-19 mid-March, $155 million was fronted to City Departments to fund urgent costs. This $155 million was loaned from the City’s Reserve Fund ($30 million) and Building and Safety Trust Fund ($125 million).

City Administrative Officer Richard Llewellyn reminded the committee that these loans will have to be paid with interest. When asked about expenses since the April 11th accounting, Llewellyn answered that accounting for expenses across departments is an ongoing process.  So “If you’re doing a straight line from that [$44.4 million accounted COVID expenses as of April 11th], it ends up being $134 million for this fiscal year. But a straight line is honestly not the way to do it,” he said.

Deliberating on the essential City functions jeopardized by public health and safety priorities, Krekorian cautioned committee members on “mission creep.”

“City government has become seen as the provider of all sorts of services that really have never been a part of City government’s mandate or jurisdiction even,” Krekorian said.  “The City is not and has not been, and should not be in the business of public health. That isn’t what we do. That is a County function, to do public health. And yet, because of the need, we responded quickly, provided things like testing, setting up the Convention Center as a surge hospital, and going to significant expense to provide public health related services, that to be candid, should really be more within the province of other government agencies whether the County or the State.”

That the City has responded so adeptly Krekorian attributes to the high profile of Los Angeles elected officials relative to other government bodies in Southern California. He added that “We have basic City functions we need still to be able to provide. We can’t take on the responsibility of other government entities that come at great expense. We need to pursue reimbursement from whichever branch of government should appropriately have taken on that responsibility.”

According to officials at the meeting, the cost of this mission creep goes beyond the budgetary concerns on which City government now must mediate; it also affects (in addition to many other services) funding for vital programs like the Climate Emergency Mobilization Office and Wildlife Connectivity Project.

These environmental programs, which power the City’s ability to transition into climate preparedness and ecological sustainability, have been cut from the Mayor’s proposed budget.

In response, environmental organizations such as Tree People, Citizens for Los Angeles Wildlife, and the Neighborhood Council Sustainability Alliance, made numerous public comments at the meeting, advocating for the reinstated funding of these programs. Others, including The Nature Conservancy, the Los Angeles Food Policy Council, and the National Wildlife Federation, submitted public comments into the Council File, similarly advocating for reinstated funding.

Council Members Paul Koretz (CD5) and Bob Blumenfield (CD 3), who are longtime champions of these programs and also sit on the Budget and Finance Committee, voiced their qualms about losing the environmental progress established in Los Angeles. With this in mind, Koretz made a motion that the City:

“…direct the Emergency Management Department to include in its list of essential emergency City services which shall continue during the COV1D-19 crisis all efforts consistent with City policy to reduce greenhouse gas and toxic emissions, including but not limited to, building renewable energy projects, electrifying our buildings and transportation network, enforcing the reduction of plastic pollution, planting trees, protecting wildlife habitat connectivity, recycling and reducing food and other waste, expanding clean mobility alternatives, and other such efforts.”

This motion is likely to be brought up during the next City Council Meeting on May 21st, and it will return to the Budget and Finance Committee for approval.


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Calli Sara Goldstein
Calli Sara Goldstein
Calli Sara Goldstein is a contributing writer for the Buzz, specializing in sustainability, ecology, and agriculture.

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