Neighborhood Council Budget Advocates

In March 2011, a committee of Neighborhood Council (NC) members released a report entitled "Saving Jobs - Saving Services A White Paper with Recommendations to Decrease the L.A. City Budget in a Time of Economic Crisis." This committee of Neighborhood Council members was comprised of Neighborhood Council Budget Advocates who were elected by their peers to represent the budget priorities of their Neighborhood Councils, their communities, and their regions to the Mayor and City Council.

The report identified several recommendations categorized within the following four areas:

1. Increasing Efficiency
2. Generating Revenues
3. Structural Changes
4. Reducing Expenses

This report provides an overview and analysis of the recommendations presented by the Neighborhood Council Budget Advocates. Specifically, a matrix (Attachment 1) has been developed to address each recommendation presented by the Neighborhood Council Budget Advocates. The matrix provides a response for each recommendation. These responses include information on actions the City has already taken with regard to the recommendation and/or provide clarification of the issues in question. Many of the issues presented by many of the recommendations are already being addressed through existing Council Files, however several will require additional analysis and responses by departments similar to the preliminary response submitted by the Office of Finance (Attachment 2).

On Monday, thirteen Neighborhood Council selected Budget Advocates presented Mayor Antonio Villaraigosa and his staff with recommendations for a sustainable financial future for the city of Los Angeles. The Mayor expressed a general approval for many of the recommendations and expressed a willingness to endorse the spirit of, if not the all of the content, of the report.

After brief introductions and an overview of the information gathering process that began in October and included consultations with the mayor’s staff, visits with department heads and labor officials, and outreach to neighborhood councils and all Angelenos via an online survey, Jay Handal of the West Los Angeles Neighborhood Council laid out the Advocates’ recommendations.

From the beginning it was clear that the Mayor was relaxed and engaged, expressing a desire to resolve the structural deficit on his watch.

The presentation began with efficiency recommendations which included follow-up on Controller audit findings totaling $300 million in potential savings, the streamlining of the permit process, collection reform, endorsement of the CORE Blueprint for Change and a call to transfer leased occupancies to vacant, city owned properties. The mayor listened thoughtfully and demonstrated agreement with many of the recommendations.

During a discussion of revenue efficiencies, the Mayor expressed support for the City Attorney’s Administrative Code Enforcement (ACE) proposal and agreed that since we continue to operate parking facilities we should work to manage them to their fullest potential. He also expressed ongoing support for the Shop LA, a program which began as a previous Budget Advocate recommendation, spoke of his efforts to bring more philanthropic donors to the table to support activities such the Gang Reduction and Youth Development (GRYD) program, and nodded in agreement to the idea that budget cuts should not be blind to a department’s revenue generating potential.

On the topic of structural changes, the mayor agreed with the idea of looking at departments that can be easily combined such as the recommended merger of the offices of Treasury and Finance, but noted the difficult road bringing all of the required parties (Labor, Departments, and the City Council) to a consensus.

It became clear when the subject moved to expense reductions, that this continues to be an area of primary focus for the mayor. Two years ago in a similar meeting, the mayor had expressed confidence that given his labor background, there was a trust between his office and labor leaders that would allow the city to make the structural changes necessary to adapt to what he now agrees to be a “new (economic) normal”. Two years later, this “only Nixon could go to China” approach has yet to bear the fruit required to put the city on a sustainable path.

The Advocates are recommending a diverse Citizens’ Commission which could provide a balanced review of this contentious and complex issue. The mayor agreed with recommendations for healthcare co-pay increases to $20, and a requirement for employees to pay a reasonable market rate for dependent coverage. At one point he mentioned the phrase “do I have a witness?” to express his agreement with many of the labor related suggestions.

The Mayor seemed to agree with the Budget Advocates’ position that the time for furloughs had come to an end, and that the city needs to draw a line on service levels and provide them full-time. He also endorsed the idea that City Council districts report all income streams and detailed expenses in an online/ real-time manner, and volunteered the same requirement for his office.

Last year the Department of Neighborhood Empowerment was put under the microscope in budget discussions, and the presentation closed with a proposal for delaying NC elections for two years while working with the city to arrive at a sustainable election system. This would allow the NC’s to continue to receive their $45,000 annual allocation with an overall savings of $900,000 from the 2010-11 fiscal year budget. It was pointed out that if the 3,000 NC board members put in an average of 10 hours per month at a living hourly wage, the city receives an annual benefit of over $4 million from their services. The mayor agreed with the value of the system, citing the efforts of the Budget Advocates as an example. He reiterated that he has been supportive of NC funding in the past, and that although he had been considering a small cut, he would evaluate this proposal.

The mayor closed the meeting by praising the efforts of the Budget Advocates, noting that on their own time they had become quite knowledgeable about the city’s finances. He (and later Deputy Chief of Staff Matt Szabo) described labor negotiations as ongoing, and said that many of the Advocates’ recommendations were quite reasonable, and currently on the table in some form. He also recommended that the group begin to work with the Performance Management Unit (PMU) on the efficiency recommendations.

The fact that the Budget Advocates were selected five months in advance as opposed to the previous one to two weeks, resulted in a much deeper investigation and presentation which included a physical report for the first time. Labor discussions clearly are ongoing, but recommended changes backed by survey results citing overwhelming to majority support for compensation reduction, as well as the nationwide clamor for reform, provide support for elected officials to pursue tough changes.

Perhaps the most optimistic development from the meeting was the mayor’s suggestion that the Budget Advocates work with the PMU to further explore the proposed efficiencies and structural changes. While this relationship may not result in immediate changes that can balance the budget now, with persistence, they could form the foundation for significant savings in the future and perhaps nurture a new spirit of creativity and political will for optimum performance by the city.

The Budget Advocates’ task is far from complete. Following the meeting, several members were headed to attend a Budget and Finance Special Meeting and plans are in the works for a presentation to the City Council. You can follow their activities at budgtadvocatesla.com.

(Scott Bytof is the South Park Resident Director on the Downtown Los Angeles Neighborhood Council, was a 2009-10 Budget Advocate and is a 2011 Budget Advocate alternate. He can be reached at scottbytof@ca.rr.com. This email address is being protected from spam bots, you need Javascript enabled to view it , and followed at Twitter

Increasing employees’ pension contributions, hiring professional parking lot operators and consolidating the city’s public safety departments within the Los Angeles Police Department are among the financial recommendations Neighborhood Council Budget Advocates made today in a two-hour meeting with Mayor Antonio Villaraigosa.

The 20-member committee focused their recommendations in four areas:

1. Increasing Efficiency
2. Generating Revenues
3. Structural Changes
4. Reducing Expenses

"It is the belief of the Neighborhood Council Budget Advocates that the application of some or all of the proposals contained in this report can help save the city millions of dollars while avoiding the disruption of essential services to the residents of the city," according to the report.

The budget advocates did not specify how much money could be saved or generated in total through their recommendations.

The creation of a Citizen Commission on Public Employee Pension(s) and Benefit Review is a top recommendation from the budget advocates. This panel would be tasked with providing “balanced” reviews of pension issues while analyzing data on pensions in Los Angeles and other big cities.

The report also recommends increasing health care co-pays to $20 and requiring current and retired employees to pay a “reasonable market rate” for dependent health coverage.

Administration costs associated with running LACERS — the agency that oversees civilian employees’ pensions — should be funded through a surcharged paid by beneficiaries, according to the report, which also recommends employee pension contributions increase to 11 percent. Villaraigosa has already come out in support of that second recommendation.

Other suggestions from the report include:

• Hiring commercial parking lot operators to run the city’s garages
• Consolidating the city’s police departments under the leadership of the LAPD
• Shortening the collections period to 120 days
• Revoking delinquent business permits
• Moving city departments from rental properties to unoccupied city-owned buildings

The budget advocates are expected to present their findings to the Los Angeles City Council on March 29.

They have become familiar faces to city department personnel and labor leaders, have promoted survey participation and Neighborhood Council outreach, and have spent long days and nights across the city crafting their message. On Monday, the Neighborhood Council selected Budget Advocates are going to City Hall to discuss a sustainable financial future with Mayor Antonio Villaraigosa.

The process began in October, as each of the 90+ Neighborhood Councils selected two budget representatives to attend the Mayor’s Budget Day at City Hall.

Attendees listened to presentations and remarks by the Mayor and other city officials. The topics were familiar, a current $63 million budget deficit for FY 2010-11, the need for pension reform, and departments dealing with less resources. Revenues had flat lined and were no longer decreasing, but were not growing.

Following this presentation, the representatives broke out into seven regional planning areas and discussed topics for the Mayor’s Budget Survey and the meeting with the Mayor in March.

Pension and healthcare reform were prominent mentions, as were department consolidation, efficiency, collections, elected officials’ discretionary funds and even the CRA.

This discussion allowed participants to get to know each other and the issues, and at the close of the sessions, two Budget Advocates were chosen to represent each planning area. A feedback loop was also established for the budget representatives to keep their Neighborhood Councils informed on budget issues as they arose.

In the months that followed, the Budget Advocates played an instrumental role in shaping the content of the Mayor’s Budget Survey by choosing topics and expanding outreach to include residents and business people as well as the city employee labor movement.

Nearly 10,000 survey responses reflecting support for maintaining Fire Department funding (60%) and Police hiring (53%), reforming pensions (80%), reducing pay for elected officials (97%) and employee pay and benefits (60%) informed the advocates, as did meetings with departments and labor representatives which brought to light creative opportunities, insight, and a sense for how far the impacted parties might go to bridge the budget divide.

Last Saturday at the Regional Budget Day, the representatives returned to City Hall to hear from city officials and Neighborhood Council leaders about a projected $350 million deficit for FY 2011-12 with similar deficits expected in future years, and the need to bring the best ideas together to maintain core services.

Afterwards, the representatives and advocates once again broke out into their planning areas to discuss regional differences in the survey results and to review topics to be presented to the mayor on March 21st. Having received this feedback, the Budget Advocates spent the rest of the day putting the final touches on the presentation for the mayor and a planned presentation to the City Council.

With survey results and the Neighborhood Councils and stakeholders behind them, Budget Advocate leader Jay Handal said that this year’s group has been a “different kind of committee”. Because they were selected in October (as opposed to March in previous years), they have had more time to dig in and provide more depth. They also plan to produce a physical report as part of their presentation.

Some of the simpler suggestions involve acting upon already available information such as the Commission on Revenue Efficiency (CORE) findings and City Controller audits.

Others will include revoking and not issuing permits to entities that owe the city money, setting up a “fast track” team which might include legal staff to expedite structural and process changes, implementing new technology and establishing and promoting service standards.

With a large percentage of the budget consisting of personnel costs, the discussion would not be complete without reviewing labor issues. The Budget Advocates realize that the city cannot survive by continuing to cut services, but also sees the need to reflect current practices in the labor marketplace.

The group considers furloughs as a short term solution for which the time has passed. Compensation will need to change, but only in conjunction with a stable sustainable budget that does not seek changes annually, and allows for a mutually rewarding future.

Handal suggests a theme of “service before politics” will be woven throughout, and that the committee has sought to put the pieces in place to maintain a productive city workforce and core services. He suspects that many aspects “will not be well received” but feels that this will be an indication that the suggestions are fair and apolitical.

Following this meeting, the Budget Advocates expect to present to the City Council, and will continue to seek feedback from Neighborhood Councils and their budget reps, serve as advocates throughout the Budget and Finance committee hearings, and will soon be posting reports on budgetadvocatesla.com.

(Scott Bytof is the South Park Resident Director on the Downtown Los Angeles Neighborhood Council, was a 2009-10 Budget Advocate and is a 2011 Budget Advocate alternate. He can be reached at scottbytof@ca.rr.com.This email address is being protected from spam bots, you need Javascript enabled to view it and followed at twitter.com/sbytof) –cw