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Friday, September 14, 2012

Predicably,the News is Bad After Council Passes Budget

Last February, I was the lone Council member to protest the City Council becoming the Successor Agency to the legislatively abolished Redevelopment Agency. (

My objection was simple: the City Council needed to heed the advice given to the City Council of Los Angeles -- that becoming the Successor Agency to our RDA would mean that the City would be financially liable for any expenditures disallowed by the the State Department of Finance or the LA County Auditor who was to review our expenditures or obligations we claimed related to Redevelopment.

Well, it happened in May 2012. And then it happened again in August 2012 -- a recent audit by LA County Auditor Controller is disallowing over $5 million claimed for administrative expenses. Additionally, the City is not going to be able to recover $96 million in a loan it claimed it made to the Redevelopment Agency. Finally, a list of redevelopment projects submitted by the City have now been deemed "questionable." (Click here to read audit.)

So where is the money going to come from for Administrative Expenses related to the dissolution and management of the assets from Redevelopment? Police, fire, parks and recreation, libraries, infrastructure? Well if it has to come from our general funds -- then it will come from those city services.

Interestingly enough, the LA County Audit announcing these problems was not given to the City Council until after the FY 2013 budget was adopted. Coincidence? Kinda similar to the fact that the City Council was not given an opportunity to vote in public on whether or not to taken on the risk as Successor Agency. Coincidence? Nah. Lighting doesn't strike in the same place twice...
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