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40% of Pet Project Funds Going to Salary Accounts

Some council members are hoarding money intended to go toward needs in their districts.

May 06, 2003|Matea Gold | Times Staff Writer

Two years ago, Los Angeles City Council members voted to give themselves $4 million a year to spend on pet projects in their districts, arguing that they needed a consistent source of money to help pay for graffiti cleanup, tree planting and other programs to spruce up neighborhoods.

But since July 2001, the council members have transferred more than 40% of those community improvement funds into their office salary accounts, according to city records.

The move does not allow the council members to increase their own salaries, which are set by law at $139,476, but it has allowed them to pay for staff raises and additional hiring. Some council members have simply let the funds accumulate, increasing their salary accounts by nearly half a million dollars, about half the total budget for each council office.

City Controller Laura Chick said she was astounded at the way the money has been used and at the lack of oversight for spending it.

"These dollars are not being spent with any plan or criteria or evaluation that's shared openly with the public," Chick said. "These are, from every respect, slush accounts that advantage the incumbent."

For years, council members have received $20,000 a year to spend on neighborhood projects. Two years ago, the council voted to give themselves an additional $250,000 per year, doled out at the discretion of each of the 15 council members.

The city does not publicize the existence of the money, and often community organizations have learned of its availability only after appealing to a council office for assistance on a project.

Of the $6.2 million the council members have tapped from the two accounts since July 2001, $3.5 million went directly to neighborhood programs and activities, while $2.7 million was transferred to the council offices' salary accounts, according to documents obtained from the city clerk and the city controller, which routinely processes city checks.

Most of the transfers happened at the end of the last fiscal year in June, when council members had unspent money in their community improvement accounts.

Council members defended their use of the money, saying it has allowed them to beef up their field staffs and help worthwhile neighborhood groups without being stymied by the city bureaucracy.

"If all city money ran this efficiently, without overhead, we'd be better off," said Councilman Eric Garcetti. "This is stuff that goes directly into the community, with no middleman."

Robert Stern, president of the Center for Governmental Studies, a Los Angeles-based nonprofit organization that advocates for government accountability, called that argument "a lame excuse," noting that the City Council has authority over the city's spending. Stern said he is troubled by the lack of transparency in the use of the money.

"Certainly, it could be abused," he said. "I'm sure most of these expenditures are legitimate. That's not the point. The point is they should go through a process on this, and people should know how they spend the money."

Money Not Budgeted

For the second year in a row, Mayor James K. Hahn has not provided money for the community improvement funds in his budget proposal, saying the city's tight finances make it difficult to fund discretionary programs. Several council members said they would try to restore the account this month as they review the mayor's proposed budget, just as they did last year.

"It's just really been helpful to have that money to direct to causes that improve the quality of life in the 15th District," said Councilwoman Janice Hahn, the mayor's sister, who has given nearly $150,000 of her discretionary account to the Los Angeles Harbor-Watts Economic Development Corp., a nonprofit that works to bring new businesses to the area.

Mayor Hahn would not say whether he would veto the community improvement account if the council reinstates it. He suggested, however, that if the council wants to fund more community programs, it should do so through the neighborhood councils.

"If we're going to have some money available for worthy community efforts, that ought to be something that's in consultation with the neighborhood councils, rather than just picking somebody," the mayor said. "This ought to be something that is opened up."

The community improvement funds, also known as general city purpose funds, first garnered public attention this spring, when a group that received money from Councilman Nick Pacheco's account was linked to a political committee supporting his reelection. The councilman and the two groups denied any wrongdoing.

Few Limits on Spending

According to city guidelines, the $270,000 each council office receives annually is intended for "community activities that promote the image of the city and serve a public purpose."

Suggested activities include community festivals, Neighborhood Watch programs and street beautification. The funds cannot be used for political or religious activities, but there are no other limits on how the money can be spent.

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