9:42 a.m.
Friday, 21 July 2017

Los Angeles could go bankrupt

Por Rubén Vela

Correspondent

April 9th

Los Angeles, California.- Los Angeles could go bankrupt if it doesn't overhaul its finances with new taxes, possible layoffs and the privatization of some city services, the city's top budget official Miguel Santana says.

Chief Administrative Officer Miguel Santana told the Los Angeles Times Friday that a $222 million budget deficit has the city in "crisis mode." The gap is expected to widen to $427 million by 2014-15.

In a sweeping report, Santana blamed the shortfall on stagnant revenues and rising employee costs such as payroll and pensions.

Without cutting costs and coming up with about $150 million in new income, "we're facing the complete devastation of city services, including public safety," he said.

"We're always in crisis mode", Santana said to the newspaper. "We're always trying to close that shortfall." Without cutting costs and coming up with about $150 million in new revenue, "we're facing the complete devastation of city services, including public safety," he said.

One proposal is to double the so-called documentary transfer tax imposed on property sales, which Santana claims could generate $100 million. Raising the parking tax by up to 15 percent would bring in $40 million. Both measures would have to be approved by voters.

Santana also wants to dole out some city services to private companies or nonprofits, including management of the LA Convention Center and the LA Zoo. Outside laborers could be hired to do some of the city's custodial, street maintenance and information technology work, he said.

Santana said layoffs were a possibility but could be avoided if employees agree to forgo the raises promised to them for the next two fiscal years. The city's workforce has been reduced by 4,900 positions in recent years.

In a proposal that isn't going over well with the city's firefighters union, Santana also asked for an evaluation of "various options" for the provision of emergency medical transport services in the city. One option, Santana said, would be to hire a private company to provide the services, which are currently handled by the Los Angeles Fire Department.

"We're one of the few cities that provide ambulance transport by firefighters," Santana told the Times, noting that about 80 percent of the department's calls are for medical emergencies. He also asked for a third-party analysis of the department's deployment model "to determine the most efficient and effective deployment of Fire Department resources citywide", but Pat McOsker, president of the United Firefighters of Los Angeles City, said turning over ambulance services to private industry "would be a public health disaster.

More in http://lat.ms/Ifynao

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