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Editorial

Ripping off Los Angeles

The city is owed about half a billion dollars. The City Council's efforts to speed up debt collection have been woefully inadequate.

February 27, 2012

Last May, after months of reports on how poor a job Los Angeles does recouping about half a billion dollars that it is owed, and after a few more months of chattering and philosophizing, the City Council voted to create a position to take charge of collections. It got the title wrong — "inspector general" utterly fails to describe the collections position — but let's not quibble over words. Let's just get back some of that $541 million.

And let's now, eight months later, check back in with the inspector general to see how the job is going, how much money has actually been pulled in, how much should be written off as uncollectable and what additional tasks our debt marshal should undertake. We're also interested to know, after nearly three fiscal quarters on the job, if the inspector general has recommendations about how to ensure that those city officials who were supposed to have had some role in collecting the money all along — people such as the mayor's director of finance, the members of the Police Commission, the city controller, the city attorney and the like — actually do start going after missing funds in the regular course of their business, so we don't have to keep adding new commissions and positions like inspector general to do the work that city leaders and employees were supposed to have been doing.

So how much money has the inspector general recovered? $0. Why? We'll let you guess. And if your guess is that it's because there still is no inspector general and that the appointment remains gummed up in the City Council, you win. But of course, if you live in Los Angeles, you lose, too. To the tune of about half a billion dollars.

The council has a curious sense of priorities. With a persistent structural budget deficit and a looming shortfall in July of at least $150 million, and with basic services such as graffiti abatement and one-call access to City Hall through the 311 telephone system slashed, the city needs the cash that absconders and rip-off artists refuse to pay. But even more basic than the money is the all-too-accurate perception that Los Angeles is an easy mark. The failure to collect money owed merely encourages other deadbeats to rob the city and then, in an act of supposed generosity, agree to some kind of deal in which outstanding debt is written down or written off.

In order to reach above the smothering City Hall ooze toward some outsiders who could survey the problem and propose solutions, the council created a Commission on Revenue Efficiency. The panel's recommendation for an inspector general dates to October 2010. The lumbering council then took six months to adopt it — and now another three-quarters of a year have passed and the position remains mired in the council's trap. It is being sucked down, along with $541 million. Perhaps one day the position, the commission's other recommendations and the money itself will turn up. Maybe in a museum, alongside the bones of woolly mammoths and giant sloths.

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