Los Angeles City Council members voted today to put $12 million of their so-called discretionary funds into the emergency reserve, but it represents only a portion of the money that the mayor has asked them to turn over.The City Council's 15 members agreed to chip in $800,000 each.
Some will turn over AB 1290 funds, which represents a portion of the property taxes paid by residents in community redevelopment areas within their districts.
City Administrative Officer Miguel Santana had recommended transferring all $10 million of AB 1290 funds into the emergency reserve.
Councilman Herb Wesson argued that such a proposal discriminates against the poorest districts, which are the only ones with community redevelopment areas.
"This money was going to be taken out of the districts that could afford it the least," Wesson said.
As a compromise, he and the rest of the council agreed instead to remit $800,000 from each of their districts.
Each member of the council controls several accounts and trust funds, some of which capture portions of revenue from property sales, oil pipeline franchising fees and ads placed on city bus shelters and kiosks.
There are limitations on how some of the money can be spent. For example, a portion of the "community amenities trust fund" must be used to mitigate the effects of the Sunshine Canyon Landfill. Funds in another trust fund can be spent only for projects in Venice.
Mayor Antonio Villaraigosa a few weeks ago called on the council to turn over about $40 million in discretionary funds.
In an addendum to his mid-year financial status report, Santana computed that the council districts have $26.5 million in "uncommitted council funds" on top of $10 million in AB 1290 funds.
He also noted that the council's salary account contains about $22 million, and said a 5 percent pay cut would put $1.07 million into the emergency reserve.
Several members of the council said they and their staffs are already taking pay cuts and/or furlough days, but expressed willingness to consider further reductions.
The city plans to deal with this year's $212 million budget deficit by taking money out of its $230 million emergency reserve. Since credit rating agencies look at the emergency reserve in assessing the city's fiscal situation, City Council President Eric Garcetti has set a goal of putting $50 million to $70 million back into the emergency reserve by June 30.
Faced with a $485 million deficit next fiscal year, the City Council has called for eliminating 4,000 jobs by July 1 to save between $260 million and $300 million.
Mayor Antonio Villaraigosa and Santana maintain the same amount of money can be saved without layoffs if all city employees agree to at least a 10 percent pay cut.
