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Villaraigosa sets sights on City Council's pet projects funds

To plug a shortfall, he's seeking to borrow $40 million from accounts that are used for neighborhood initiatives. But some of the funds can't easily be touched, council aides say.

February 09, 2010|By Maeve Reston

Members of the Los Angeles City Council have more than a dozen accounts squirreled away that they dip into for pet projects. They have set aside money for security cameras around MacArthur Park, artistic bike racks in Hollywood and a program that sends city workers to pluck abandoned shopping carts off the streets of the San Fernando Valley, to name just a few.

Last week, Mayor Antonio Villaraigosa veered into unfriendly territory when he told the council's 15 members that he wanted to borrow $40 million from those accounts, which are off the books, to shore up a depleted reserve as the city grapples with a $212-million budget shortfall.

The mayor doesn't have the power to take the money, and over the years some members have zealously guarded their district's share of the more flexible funds. Even though they are scouring other city departments for places to trim, council members are reluctant to part with resources that pay for neighborhood-friendly initiatives and, on occasion, the salaries of their own staff.

"If the mayor is willing to put money up front to help me house homeless people, fine," said Westside Councilman Bill Rosendahl, who controls $4.3 million in a trust from land sales in Venice. He had planned to use much of it for homeless services. "These are valuable, necessary monies to help me with a crisis.

"He has to explain to me and my district how he can better spend that money than what we're spending it on," Rosendahl added. "We don't waste a penny."

Others may be more amenable. Before the mayor's request, Council President Eric Garcetti asked colleagues to consider giving up a portion of their discretionary funds this year. Garcetti said he wanted to protect the council's projects that create jobs, but "in a budget year like this they should be used toward critical economic development projects or be used to help balance the budget," he said.

"It's not that those funds are used for bad things," he said. "It's that we have people who are about to lose their jobs."

The amount of the council's discretionary money available varies widely depending on whose calculation is being used. A spreadsheet detailing the balances surfaced last week in a report by the city's top financial analyst. Before that document was released publicly, however, the spreadsheet disappeared. City Administrative Officer Miguel Santana, the city's top financial analyst, later said he pulled it back while his office was "confirming the numbers."

A copy obtained by The Times identified $3.5 million to subsidize special events, and $26.6 million in council-controlled accounts, including $10.7 million in trusts that capture proceeds from the sale of city property and $4.8 million from revenue generated by advertising placed on city bus shelters and kiosks. Those so-called street furniture accounts are routinely used by some members to pad their salary accounts, including as recently as last week.

But council aides were quick to point out that some of the trusts were set up with strict legal guidelines and may be untouchable, while other accounts could require the council to change the laws that set up the trusts before the money could be lent.

Councilman Greig Smith noted, for example, that although budget analysts identified $7.1 million in a council account called "community amenities trust funds," at least $5.6 million of it must be spent for projects within a few miles of the Sunshine Canyon Landfill to mitigate the effects of the dump. Smith's office has designated that money, which is the product of a lawsuit settlement, toward development of a park in Aliso Canyon and for baseball and soccer fields for children in Granada Hills.

Budget analysts say there is at least $10 million in another account used for economic development projects in certain council districts. That account, which is replenished with a slice of tax revenue from the city's redevelopment areas, actually had a balance of $27 million at the end of last fiscal year, according to a 2009 redevelopment agency memo. About $19 million was committed to projects.

When the city's budget team attempted to scoop up $10 million of that money last week, Councilman Herb Wesson objected and sent the idea to a committee he heads for further review.

"I take my chairmanship very seriously. It is my responsibility to properly vet everything," Wesson said, adding that he intends to find out "what projects will be delayed or maybe even eliminated."

He acknowledged that rules for using those economic development funds were "very flexible." "You could use it for just about everything," he said.

To a great extent, the use of the money reflects the priorities of each council member. Records show Councilman Tom LaBonge requested $200,000 for a traffic signal at Hillhurst Avenue and Finley Avenue in Los Feliz. Councilman Tony Cardenas asked for $840,000 for sidewalk repair.

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