By now, most of you have read David Zahniser’s report concerning Mayor Villaraigosa’s attempt to balance the budget by deferring payment of $100 million in personnel costs until after he leaves office. The mayor even had the audacity to state he would leave the city “in the black” for his successor.
Wendy Greuel is OK with the mayor’s plan.
Wait. How can I say such a thing?
She has issued no statement one way or the other.
Precisely my point.
There are many things Greuel can ignore. If Villaraigosa is using too many sharpie highlighters, who cares?
But to ignore foisting $100 million in current expenses on future periods and claim it is all about being fiscally prudent is not something an elected official can simply ignore, especially the City Controller.
Complete disclosure of all material events and obligations is one of the fundamental responsibilities of a controller in private industry or government. Failure to disclose critical information could lead to criminal charges under certain circumstances. $100 million is material in all aspects to the city, especially if it could very well come due much sooner than later (see addendum below for the extent of the disclosure in the city’s financial statements).
It appears that Greuel is walking a fine line between willful failure to report the state of the city’s financial condition versus gross negligence. I might be willing to give her the benefit of the doubt and assume the latter since she has never demonstrated any acumen when it comes to Accounting and Finance 101.
David Zahniser’s article detailed a string of irresponsible decisions by the lame duck mayor Antonio Villaraigosa – decisions with adverse ramifications for the city and whoever succeeds him.
The most glaring deficiency is failure to disclose not only a growing liability of deferred LAPD overtime payments, but the possibility that they may have to be paid as early as July 2014 when the overtime banking cap could drop to 150 hours per officer from 800 .
That’s a possible $78 million hit against the general fund.
Zahniser goes on: “Putting off overtime costs helped free up money for Villaraigosa’s signature public safety initiative: expanding the size of the department by up to 1,000 officers.”
A real controller would take the mayor to task and publicly insist on a plan to deal with the obligation.
That won’t happen in Los Angeles with Greuel in control of the check book. The last thing she wants is an issue that could jeopardize her relationship with Villaraigosa during the upcoming campaign.
By contrast, Laura Chick would have done an OVO – Occupy Villaraigosa’s Office. She would have camped out there until the fibers in the carpet resembled the lawn around City Hall after the OLA participants were evicted.
If Greuel is elected as our next mayor, and God help us if she is, how will she explain the budget gap that results from Villaraigosa’s punt?
She would probably feign surprise as she does with every other financial scandal that hits the city.
Let’s not stop with Greuel. Council Members Eric Garcetti and Jan Perry, both candidates for mayor, have been quiet as well. So-called budget hawk Bernard Parks, who oversees the development of the annual budget, has also been silent.
Please remember – you have other choices for mayor. So far, only candidates Austin Beutner and Kevin James are untainted by this latest scandal.
It won’t be long before candidate forums are upon us. Ask tough questions and demand complete answers. Insist on forum moderators who will ask follow-up questions if a candidate does a tap dance around the issues. If we play softball, we will end up with Greuel.
Addendum ( Source – from the footnotes to the city’s financial statements, latest year published as of June 30, 2010. There is no discussion or projection of the financial impact, only this summary disclosure):
Accumulated Compensated Time-Off: The MOU with the union representing police officers at the rank of Lieutenant and below, and certain civilian employees, provides that officers will accrue compensated time-off for accumulated overtime to certain limits. Whenever an employee resigns, retires or is discharged from the Police Department, the employee shall be paid in cash for all compensated time-off due. In case of death, payment will be made to the estate.
Accrued compensated time-off is reported in the government-wide financial statements. For the Governmental Funds, expenditures are recognized to the extent that they are normally expected to be liquidated with expendable available resources and are due and payable at year-end. Also, for governmental activities, accrued compensated time-off is generally liquidated by the General Fund.