City Council Slush Funds Exposed

Today the LATimes reported that the CAO, as a part of a request of by CM Bernard Parks at Monday's Budget and Finance Committee to identify additional potential budget cuts, has identified more than $30 million in off-budget, City Council controlled, accounts which are used by Councilmembers for pet projects in their own districts.

One of the "secret" off-budget accounts that the CAO's report identified, highlighted below in bold, is our old friend Street Furniture Revenue Funds:

When City Administrative Officer Miguel Santana outlined options last week for closing this fiscal year’s $218-million budget gap, some city officials privately grumbled that the offices of council members looked to be untouched. During a budget hearing Monday, Councilman Bernard C. Parks ordered Santana to generate an addendum report showing all possible cuts across the city, including the Police Department.

In a spreadsheet obtained by The Times that was not publicly released as part of Wednesday's addendum budget report, Santana’s office showed $26.6 million in the council’s “discretionary special accounts.” If the council agrees, some of that money could be used to replenish dwindling city reserves, analysts said.

Within those discretionary accounts is at least $6.5 million generated by the sale of surplus properties, according to the memo. (Historically when a city property was sold, half of the proceeds went to the council district where the property was located, while the other half was deposited into the city’s general fund, which pays for basic services such as parks and libraries.)

The $26.6 million also includes $4.8 million in “street furniture” money, which is generated by ads on bus shelters and kiosks, that can be used by council members for beautification projects, or in some cases to pad their salary accounts. There are also a number of small trusts that council members use to award scholarships and rewards to residents whose tips lead to the conviction of vandals and taggers.

Not to toot my own horn (well, just a little) but, as loyal readers know, I've been harping on the misuse of Street Furniture Revenue Funds for quite some time. I've argued on a number of occasions that these funds can legally only be used for street and street safety improvements and bus shelters, and not to pay for Council Offices' Planning Directors nor Council Office staff costs.

Below is a list of transfers, totaling over $500,000, from the Street Furniture Revenue Fund to various Council Districts. The list is by no means comprehensive, but is simply meant to illustrate some of the transfers from the Street Furniture Revenue Fund I identified, and posted about, in the last few months: 

• Transfer of $75,000 from the CD 4 (Tom LaBonge) portion of the Street Furniture Revenue Fund to that office's general salaries account (Council File 09-0011-S52).
• Transfer of $75,000 from the CD 4 (Tom LaBonge) portion of the Street Furniture Revenue Fund to that office's general salaries account (Council File 09-0011-S52).
• Transfer of $125,000 from the CD 5 (Paul Koretz) portion of the Street Furniture Revenue Fund to that office's general salaries account (Council File 10-0011).
• Transfer of $25,000 from the CD 8 (Bernard C. Parks) portion of the Street Furniture Revenue Fund to fund the development of a website, with an interactive map, video messaging, and blogging, which would provide public transit users, residents, businesses and visitors information regarding traffic conditions and bus line detours during the Expo Line Construction (Council File 09-0011-S53).
• Transfer of $95,000 from the CD 9 (Jan Perry) portion of the Street Furniture Revenue Fund to that office's general salaries account (Council File 10-0011-S1).
• Transfer of $50,000 from the CD 9 (Jan Perry) portion of the Street Furniture Revenue Fund to that office's general salaries account (Council File 09-0011-S46).
• Transfer of $6,000 from the CD 13 (Eric Garcetti) portion of the Street Furniture Revenue Fund for a environmental assessment of 5401 La Mirada for a new public park (Council File 09-0011-S51).
• Transfer of $70,000 from the CD 13 (Eric Garcetti) portion of the Street Furniture Revenue Fund for a personal services contract with Kelli Bernard (Council File 09-0011-S41).

I'd argue that only one of these charges, the $25,000 that CD 8 transferred to fund a transit website, was a legitimate use of Street Furniture Revenue Funds. The other 7 transfers were to fund each respective office's salary account.

But wait, there's more.

On Friday's Council agenda there are 4 more proposed transfers, totaling over $275,000, from the Street Furniture Revenue Fund to various Council Districts: 

• Transfer of $5,000 from the CD 4 (Tom LaBonge) portion of the Street Furniture Revenue Fund and $20,000 from the CD 13 (Eric Garcetti) portion of the Street Furniture Revenue Fund to fund a streetscape plan along Hollywood Boulevard (Council File 10-0011-S3).
• Transfer of $95,000 from the CD 10 (Herb Wesson) portion of the Street Furniture Revenue Fund to that office's general salaries account (Council File 10-0011-S4).
• Transfer of $150,000 from the CD 11 (Bill Rosendahl) portion of the Street Furniture Revenue Fund to that office's general salaries account (Council File 10-0011-S5).
• Transfer of $6,766 from the CD 13 (Eric Garcetti) portion of the Street Furniture Revenue Fund to fund the installation of Christmas lights in Atwater Village (Council File 10-0137).

Again, I'd argue that only one of these transfers, the transfer of $25,000 from CD 4 and CD 13 to fund a streetscape plan, is a legitimate use of Street Furniture Revenue Funds. Of the other 3; 2 are transfers in salary accounts, and 1 is for the installation of temporary holiday lights.

I hope that the exposure of some of these "secret" accounts will shame the Councilmembers enough that they will withdraw the above transfers from the Street Furniture Revenue Fund from Friday's Council agenda. Somehow I doubt they will, but we will have to wait and see. I'd think that after being caught with their hand in the cookie jar, the City Council would have more sense than to turn around and immediately try and do it again. The last thing they should need at this time is more attention focused there use (and abuse) of the Street Furniture Revenue fund.