CaliforniaCityNews.org

Falling Behind: L.A. Slower Than Other Cities on Spending Federal Stimulus Funds; 25% Spent

The city of Los Angeles has not been alone in struggling fiscally, so many may be surprised to learn the city has lagged behind other local governments when it comes to spending federal stimulus dollars. To be exact, Los Angeles has only spent a quarter of its funds, despite acquiring more than $630 million in stimulus grants. So why the lag in light of budget cuts, layoffs, and a shortfall of reportedly $427 million? The LA Times reports that “L.A. officials say they have been hampered by a painful irony. As millions of federal stimulus dollars flowed in the door, the city was reeling from cost-cutting measures that led to the exodus of 2,400 experienced workers through an early retirement program and more than 360 layoffs.” By mid-October, Los Angeles has only finished eight of its 108 projects and its spending rate fell way behind other big Californian cities, as well as other big cities like New York and Chicago. The Time also notes:

“The effect of the unprecedented reduction of the city's staff, officials said, was compounded by initial confusion about the stimulus program's rules, conflicting interpretations from state and federal officials about how the money could be spent, and the snags that come with launching new programs from scratch. ’What's happening here is happening everywhere, not just in California, but around the country,’ Santana said. Yet other local governments under strain have dealt more swiftly with stimulus dollars, suggesting that at least part of the problem is the slow — and in some cases dysfunctional — city bureaucracy that has frustrated residents and business leaders for years.”

Scrambling to secure funding from any source without actually having concrete plans as to how such funds will be spent is an issue, and like Los Angeles, the state overall has also not spent a majority of its $50-billion share of stimulus money. Outgoing Inspector General Laura Chick stated that “Right in the middle of the crisis, government is being asked to operate better and faster. It's not reality based. How do you move projects quickly so that they turn into jobs on the street when there are 20,000 hoops to jump through?" For more on the spending of the funds, see here.

Global Warming Critics Oppose Concord’s Acceptance of Grant Money for Climate Action Plan

More than 100 cities applied to receive a grant from the California Strategic Growth Council to fund sustainable community planning, and the city of Concord was just one of 24 local governments to secure such funding. Concord is slated to receive nearly $1 million, which will go toward creating a climate action plan, in accordance with the guidelines required under AB 32 and SB 375. However, while officials assumed that the acceptance and approval of these funds would go unnoticed, several residents voiced opposition to the city’s acceptance of the grant money. Residents who spoke out against the grant said it would lead to limitations on personal freedoms and that the science around global warming is wrong, so the city should not waste time on state laws concerning climate plans. One resident stated, “There is no global warming.” Nevertheless, the council did unanimously approve the funds. The Contra Costa Times reports:

“If Concord had not received the grant, the city would have had to foot climate action plan costs with its own money. The plan will set a baseline for the city's greenhouse gas emissions and include policies intended to cut that emission level by about 20 percent by 2030, said Michael Wright, the city's project manager for the reuse of the Concord Naval Weapons Station. Those policies may include anything from traffic management to green building standards to water conservation, Wright said. Once consultants develop a plan, the city will hold public hearings on it and the City Council can request revisions before any approval. A separate climate action plan for the weapons station is almost complete; set to be released early next year, it would be incorporated in the citywide plan.”

While several residents were on hand to express their opposition, one resident voiced support of the grant at the meeting. For more on the grant money, see here.

Up for Grabs: SF Officials Lease Park Facilities to Address Fiscal Issues; Residents Upset

For the fiscal year that began July 1, the city of San Francisco faced a $522 million budget deficit and one solution officials resorted to in order to close the budget gap was the commercialization of the city’s park clubhouses. However, local residents have called the move “privatization” and are none-too-pleased with plans to lease such buildings when their tax dollars go toward the funding of parks. Take the J.P. Murphy Playground, as Recreation and Park Department officials announced at a public meeting last month plans to lease the park’s clubhouse building on the site for as long as five years to an unspecified nonprofit group. The so-called privatization of certain services has become a more common occurrence as municipalities struggle with fiscal woes. The Wall Street Journal reports:

“Now come the parks commercialization, which first came under consideration early this year as part of a significant expansion of an existing leasing program. In most cases, the plan entails leasing park clubhouses mainly to nonprofits or private groups while leaving outdoor areas including playgrounds and fields open for general use. Traditionally the clubhouses have been open to the public and staffed by city workers. Programs such as after-school care and parenting classes often are held at the facilities. Since July, at least three of the city's 48 park clubhouses have been leased to private schools, while city officials say they want to sign up tenants for 14 more. In some cases, the city has leased an entire park, under a separate revenue-generating program that has been in place for some time.”

Officials from the Recreation and Park Department have pointed out that the plan would allow parks to stay open while the department grapples with cutting $12.4 million, or 10.8%, from its fiscal 2010 budget of $115 million. Residents have concerns about park access if private interests lease certain facilities. For more on the revenue-generating plan, see here.

Change of Plans: Oakland Shelves Plan for Large-Scale Pot-Growing Facilities...For Now

Oakland’s City Council made headlines when it decided to capitalize on the lucrative business around marijuana by approving an ordinance that would dish out permits to operate large-scale pot factories. However, we relayed earlier this month that the ordinance was facing scrutiny from the Justice Department and the U.S. attorney’s office in San Francisco due to concerns that it would violate state and federal laws, which could lead to plenty of legal action. In an update, Oakland’s City Council has decided to shelve its plans for now, so the four large-scale marijuana-growing facilities won’t be created any time soon. Instead, city lawyers will review the city’s plans and propose amendments, and on February 1st the council will discuss any changes to address legal issues at the state and federal level. Those who were seeking one of the permits from the city are bound to be disappointed, not only from a financial standpoint but also because the plan was an unprecedented move that could have shaped the industrialization of marijuana. The Wall Street Journal reports:

“Earlier this month, Alameda County District Attorney Nancy O'Malley wrote Oakland Mayor-elect Jean Quan—the city is in Alameda County— warning that the planned growing facilities could violate state law. which requires marijuana-cultivating facilities to be not-for-profit. The letter said marijuana growers relying on the wording of the Oakland proposal could violate that part of the state law. Ms. O'Malley also suggested that city-council members and other city workers could face criminal charges for moving ahead with the facilities. […]The delay in implementing the marijuana-cultivating ordinance could also hurt Oakland's bottom line. Last month, voters approved a 5% tax on marijuana sales.”

Commenting on the suspended plans, Oakland councilwoman Rebecca Kaplan released a statement saying that “We want to make sure that the city and our medical cannabis facilities are in as strong of a position as possible.” For more on the change of plans, see here and here.

Los Angeles Experiences Significant Drop in Homicide Rate; Fewest Killings Since 1967

Cuts at the Los Angeles Police Department; a bad economy; a larger population: These are all factors that have led authorities to be surprised at a new stat that has been released for the city of Los Angeles. Namely, Los Angeles is set to record the fewest number of killings since 1967, and at that time, the city’s population was about 30 percent smaller. So far there have been 291 homicides in 2010, and authorities have noted that a year with fewer than 300 killings is representative of a homicide rate that has continued to decline over the years. Also, in other cities in the county, as well as unincorporated parts, there has been a 40 percent decline in homicides.  Overall, the city of Los Angeles has experienced a drop of about one-third since 2007. The LA Times reports:

“The city's total translates into roughly 7.5 killings per 100,000 people and puts it in league with New York City and Phoenix as having among the lowest homicide rates among major U.S. cities. ‘I never thought we'd see these numbers,’ said Sal LaBarbera, a veteran homicide detective with the LAPD. ‘It is night and day compared to the old days. Night and day.’ Longer-term declines are even more notable. The city's homicide rate this year marks a 75% drop from 1992, when 1,092 people were killed during a crack cocaine epidemic and gang wars. Homicides investigated by the Sheriff's Department have dropped by more than half since the mid-1990s. The change, experts say, is not easily explained and is probably the result of several factors working together, including effective crime-fighting strategies, strict sentencing laws that have greatly increased the number of people in prison, demographic shifts and sociological influences.”

Some experts believe that the absence of a violent drug culture is a predominant reason for the decrease in murders. Will the homicide rate continue to drop? Authorities certainly hope so and have pointed to the 300-mark as an important but somewhat arbitrary milestone. For more on the drop, see here.

In the News: The Financial Woes of Cities in the Spotlight? Recent Reports Highlight Risks

There certainly has not been a shortage of stories about the financial issues of states like California, but the significant budget woes of municipalities seem to be receiving greater attention as well. Take the following report from the Fox Business Network that featured an interview with Josh Barro of the Manhattan Institute. Barro posits that cities are at an even greater financial risk and warns of a wave of municipal bankruptcies over the next couple of years. You can view the interview here:

And in a report entitled “The Day of Reckoning,” 60 Minutes recently gave coverage to the fiscal stresses of state and local governments in an 11-minute piece. One financial analyst featured in the report called a financial meltdown in state and local governments the largest threat to the American economy. You can view the entire report here:

At his personal blog, Ventura City Manager Rick Cole had the following response to the 60 Minutes report, stating that “The ‘Sixty Minutes’ piece does a service in dramatizing the financial realities. What it fails to explore is the impact on vital services that all of us take for granted. Putting our fiscal house in order without borrowing any more may be long overdue -- but as the Irish and others around the world are finding, the impact of those cuts may be so crippling that they doom hopes for economic recovery.” You can read the rest of Cole’s post here.

Quality Control: Controller Releases Long-Awaited Review of Bell’s Auditing Firm

We’ve relayed in the past that the auditing firm Mayer Hoffman McCann was facing quite a bit of scrutiny for giving the city of Bell a clean bill of health despite the many instances of corruption that have now come to light. And while CalPERS cut ties with the firm, other local governments that have used the outfit for auditing purposes have been awaiting the results of an audit conducted by the State Controller’s office. Well, that audit has been released and it doesn’t exactly redeem the performance of the firm. State Controller John Chiang’s office reviewed Mayer Hoffman McCann’s (MHM) audits of Bell and its redevelopment agency and concluded that generally accepted auditing standards were not followed. Chiang stated that “MHM appears to have been a rubberstamp rather than a responsible auditor committed to providing the public with the transparency and accountability that could have prevented the mismanagement of the City’s finances by Bell officials. Had MHM fully complied with the 17 applicable fieldwork standards, it would have led them to identify some – if not all – of the problems my office has uncovered since August.” The results of the controller’s review have been eagerly anticipated and the 153-page review will ultimately be forwarded to the state Board of Accountancy. In a press release about the review, the following was revealed:

“This review of MHM’s work found that the firm failed to fully comply with 13 of the 17 applicable fieldwork auditing standards. In particular, the firm’s auditors complied in varying degrees with fieldwork standards regarding audit documentation and evidence, risk of fraud, and litigation, and their conclusions were not supported by their working papers. MHM has worked as Bell’s independent auditor since 2006, when it bought the City’s previous audit firm, Conrad and Associates LLP. Conrad and Associates had performed audits for the City since 1994. This review focused on the working papers behind MHM’s latest audit of the City and redevelopment agency’s 2008-09 financial statements. A copy of the review has been submitted to the California State Board of Accountancy. At the firm’s request, nearly all communications during the course of the review went through MHM’s attorneys. The Controller’s review found that the firm did not adequately look for documentation and evidence to support the city’s records, did not document the reason for deficit balances, management’s plans for dealing with the financial conditions, or the adverse effect of deficit balances.”

Mayer Hoffman is reportedly disputing the findings of the review. You can read the full report here.

Foster City Resident Looks to Sue City over Police Case; Petitions CA Supreme Court

Back in 2006, a resident of Foster City held a bunch of teenagers at gunpoint after they shot his house with a pellet gun. The resident, Tom McMillin, is licensed to carry a gun and held at gunpoint those he felt were responsible for the shots at his house until officers arrived. The resident was eventually “charged with several misdemeanors, including assault with a deadly weapon, brandishing a firearm in a threatening manner and false imprisonment,” according to Mercury News. Now the resident is looking to get the state Supreme Court to approve the filing of a lawsuit against Foster City. Mercury Reports:

“Tom McMillin, of Foster City, filed a brief Monday asking the Supreme Court to overturn a lower court decision that says he waited too long to file a lawsuit from the confrontation, which led San Mateo County prosecutors to file misdemeanor charges against him. Most of the counts were later dropped. ‘(The California Court of Appeal for the First District) said it was not timely,’ McMillin's attorney said, ‘so we are going up one more to see what they will say.’ A lawyer for the city called the case ‘absurd’ and a waste of taxpayer money. Attorney Joe Howard said he intends to file a brief opposing McMillin's request.”

The city has called the resident’s behavior shocking and will try to force him to cover all attorneys' fees associated with the case for the city. For more on the litigation, see here.

L.A. Council Approves Policy to Boost Hiring of Local Residents for 98 Proposed Projects

Los Angeles City Council Members have approved a local-hire policy that will staff large-scale public works projects with a workforce that is comprised of at least one-third city residents. Fair wages and benefits for workers will also be a part of the policy that will ensure city-funded projects help grow the local economy. In addition to using local residents for at least 98 proposed projects, the city will also utilize workers who stem from a “disadvantaged background,” meaning 10% of the work will be completed by low-income, homeless, or single-parents. Over the next five years, officials have said there is $2.1 billion worth of projects that are in the works. You may recall that San Francisco officials also recently passed a tough local-hire law to boost local economic growth. The LA Times reports:

“The council approved the ordinance unanimously after a steady stream of public speakers urged passage, with none opposing it. Union leaders came to City Hall in force to extol the measure, which would expand so-called project labor agreements at city-funded construction sites. ‘These agreements create jobs, and that changes lives,’ said Richard N. Slawson, executive secretary of the Building & Construction Trade Council in L.A. and Orange counties. Both unionized and non-union contractors are free to bid for contracts under the agreements. But, in Los Angeles, unionized firms typically prevail when such agreements are in place, said Nickolas Sifuentes, a spokesman for the Los Angeles Alliance for a New Economy, a pro-labor advocacy group. Organized labor and the Obama administration heavily favor project labor agreements. Some business groups oppose the deals as giveaways to Big Labor from their political allies.”

Mayor Antonio Villaraigosa called the policy a jobs program for L.A. residents that will help speed up projects with fewer interruptions. Examples of projects include street widening to storm drainage repair to bridge-building. For more on the policy’s approval, see here.

City of Compton Sued for Violating Latinos' Civil Rights; Suit Seeks Greater Representation

A Latino candidate has never been elected to Compton’s City Council or any other city office in a city that has now become two-thirds Latino in recent years, a change for an area that has traditionally been a predominantly African American community. Is this election stat bound to change soon? Well, a lawsuit has been filed on the basis of the 2001 California Voting Rights Act, claiming that the civil rights of Latinos have been violated in Compton because their voting power has been diluted. Three Latina women are the plaintiffs in the suit, but it is reportedly unclear who is financing the litigation. The women’s attorneys argue they want to stop Compton’s scheduled April 2011 primary and June 2011 general election until the suit is resolved. The LA Times reports:

“Compton has a mayor and four council members. The council members represent separate districts but are elected by voters throughout the city. In a by-district system, voters would elect representatives in their specific districts. The court would ultimately decide whether to adopt district lines to be proposed by the plaintiffs, said Joaquin Avila, attorney for the women. Avila is a Seattle-based lawyer with expertise in voting rights cases. ‘If you [vote] district by district, your representative has to be more accountable,’ said Arnold Alatorre, 49, who runs the family-owned Alatorre Market and grew up in Compton but now lives in Downey. ‘Once they get voted in at-large, they figure they are already in, so they feel they don't have to answer to anybody.’ It would be possible to create at least one district in Compton where Latinos would make up a majority of potential voters, according to a statistical analysis included in court documents. That would probably result in the election of at least one Latino to the City Council.”

While many Latinos want to see greater representation in the community since they are a majority of the population, notably Latinos only make up 43% of eligible voters and half of the area’s Latinos residents are not citizens. Reportedly in the last decade only one Latino candidate has received more than 20% of the vote in an election. For more on issues of voting representation in Compton and neighboring cities, see here.