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Garcetti signs $9.9 billion city spending plan

LOS ANGELES — Mayor Eric Garcetti put his signature on a $9.9 billion budget for the 2018-19 fiscal year May 29, a record level of funding that includes significant boosts for sidewalk repairs, homelessness programs and the Vision Zero program aimed at reducing traffic deaths.

“We must confront our city’s biggest challenges with every available resource,” Garcetti said. “This budget includes record investments in the kind of change that Angelenos can see and feel in their neighborhoods, and I’m grateful to my colleagues on the City Council for their hard work to get it over the finish line.”

The budget, which was approved by the City Council on May 21, includes at least $20 million for a new program to install temporary homeless shelters around the city. The spending plan also includes an overall increase in funds for homelessness programs, from the current year’s $178.5 million to around $440 million. More than half of the new homeless spending will use funds from Measure HHH.

The bond measure, which Garcetti helped convince city voters to approve in 2016, is expected to raise $1.2 billion over 10 years for permanent supportive housing construction.

The budget includes $91 million for Vision Zero and traffic and pedestrian safety projects, $41 million for new sidewalks, $73.4 million for street reconstruction, and $147.8 million for street maintenance — representing increases of $13 million, $10 million, $43.4 million, and $16.4 million, respectively, over last year.

The spending plan also increases the reserve fund to $351 million, or 5.67 percent of the overall budget, and includes a budget stabilization fund of $108.5 million.

“This budget strengthens our city’s economic foundation and will improve the quality of life for all Angelenos,” said Councilman Paul Krekorian, chair of the Budget and Finance Committee. “Thanks to the vision and leadership of Mayor Eric Garcetti and the work of the City Council, we’ve achieved a fiscally prudent and responsible spending plan that will bring immediate relief to our homeless neighbors and the neighborhoods they live in, fix more sidewalks and streets, trim more trees, and boost the number of police and firefighters in our communities.”

The council also approved $20 million Garcetti earmarked to build temporary shelters for the homeless for his “A Bridge Home” program, which is one of the mayor’s signature proposals for the new fiscal year. In his recent State of the City speech, he labeled homelessness as the central issue facing the city.

The number of homeless in Los Angeles increased by 20 percent in 2017 to more than 34,000, according to the results of the Greater Los Angeles Homeless Count, although the Los Angeles Homeless Services Authority recently said the numbers in the county were inflated by 2,746, and it is not yet clear how many of those were within the city of Los Angeles.

Tom Waldman, a spokesman for the homeless authority, told City News Service the organization is still trying to recalculate the numbers for the city.

The spending plan for the 2018-19 year includes a record level of funds for homelessness programs, from the current year’s $178.5 million to around $440 million. More than half of the new homeless spending would use funds from Measure HHH. The bond measure, which Garcetti helped convince city voters to approve in 2016, is expected to raise $1.2 billion over 10 years for permanent supportive housing construction.

“This budget includes, as you know, the city’s largest-ever investment in the most pressing problem we face, our fight to end homelessness on the streets of Los Angeles,” Garcetti said during a news conference at City Hall.

The spending plan includes an additional $10 million for homeless services related to the shelter plan or other homeless programs on top of the $20 million Garcetti sought. The $10 million has been set aside in the unappropriated balance and would require additional council action to be approved. The council listed several possibilities for the funds, including for setting up more shelters or costs associated with them.

Councilman Jose Huizar, who represents the Skid Row area where an estimated 2,000 homeless people are located, had asked the Budget and Finance Committee for $20 million just for temporary shelters for that neighborhood.

Although the approved budget does not include what Huizar sought, millions of dollars in state budget surplus money for homeless programs is expected to be forthcoming, and Garcetti said he wants some of it to help fulfill Huizar’s wish.

“I was very sympathetic when Mr. Huizar said we could spend all $20 million just in Skid Row alone. Awesome. Let’s do it. And now, it looks like with the state, if we keep the pressure up, will be adding some dollars,” Garcetti said.

Before the vote, Krekorian did warn the council that stormy days could be in the future. Among possible challenges are increased workforce costs, pension liabilities, the cost of police overtime and a downturn in the national economy, he said.

“These are unquestionably challenges that we will still need to face, so I just urge members to be cautious about being too confident in the fact that we have positive trajectories. We have to be prudent about those risks going forward in the future,” he said.

Krekorian is not alone in raising concerns over the city’s pension liabilities, which total about $1.177 billion and make up 19 percent of the budget, as well as the fact that some key contracts with city employee unions are up for renewal this year. Members of the city’s neighborhood councils, who are on a budget advisory committee, pointed to pensions and city contracts as problem areas of the budget during a City Council meeting May 18.

“We have concerns that the budget isn’t in fact balanced, [but] rather is trying to hide the concerns that the city is engaged in intergenerational theft while the city is dumping billions of dollars in debt on the next two generations of Angelenos,” said Jack Humphreville of the Greater Wilshire Neighborhood Council. “The proposed budget does not take into account raises for the civilian workers, which we have been told will be about $40 million.”

But Garcetti argued that the budget strikes the right balance, aggressively attacking the issues that need additional investment such as homelessness, while also holding back reserve funds.

“This is rooted in our commitment to always being fiscally prudent and economically conservative. That is the sort of work that has driven the city’s economic turnaround,” Garcetti said.

Although the City Council approved all of the adjustments it made to the mayor’s proposed budget, the official vote won’t happen for a week or so while city staff drafts the adjustments and sends a complete 2018-19 budget back the council for a final vote.

 

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