Advertisement
YOU ARE HERE: LAT HomeCollections

Council Agrees to Transfer $13 Million to Reserve Fund

September 18, 1997|BETH SHUSTER | TIMES STAFF WRITER

With a meager $2 million remaining in the city's reserve fund, the City Council agreed Wednesday to transfer $13 million to the fund while cautioning that the city could be in dire financial straits before the end of the fiscal year.

The council voted to meet with the mayor and city department heads to discuss municipal spending in light of the low reserves.

Although Councilwoman Rita Walters proclaimed that "this city is broke," others said the situation isn't quite that bad, but that city officials should be aware that spending must be limited.

"A $2-million reserve is a pittance and does not represent the kind of fiscal management we want to see," said Councilman Mike Feuer, a member of the council's Budget and Finance Committee.

The reserve fund typically is used to pay liability judgments and Workers' Compensation claims against the city, and for discretionary purposes and emergencies.

City officials said the low reserve is mostly the result of lawsuits and other claims, and the city typically replenishes the fund from other sources later in the year. The city has a $4-billion annual budget.

But several council members said they anticipate having to pay out large claims and that the city should not let itself get into a perilous situation.

To that end, the council agreed to a series of budget transfers from liability and workers' compensation funding to beef up the reserve.

Advertisement
Los Angeles Times Articles
|
|
|