From Walter Moore
Former Candidate for Mayor of Los Angeles -- WalterMooreSays.com
L.A. City Hall goes Exxon Valdez on Cinco de Mayo
April 6, 2010
That deafening scraping sound you hear is the City of Los Angeles slowly coming to rest on the big reef of Chapter 9 bankruptcy, courtesy of Captain Villaraigosa, First Mate Eric "Gilligan" Garcetti, and the entire Spring Street Crew.
City Controller Wendy Greuel issued a memo today saying that on Cinco de Mayo, the City’s general fund will be. . . well, you need to read it in her own words, because it’ll help you remember that she has no background in finance: "I now project that if the City remains on its current path, the City's General Fund will be out of money - in fact it will be negative $10 million - on May 5th, 2010."
But there’s an emergency reserve fund, right? I mean, they wouldn’t just spend America’s second-biggest city into the ground, would they?
Funny you should ask. You see, there IS some money in reserve, and at the rate things are going now, we should be just fine until . . . June 30, 2010. Again, you have to read Greuel’s own words for flavor:
"the Reserve Fund balance could be anywhere from $0 to negative $43 million on June 30th, 2010, which would leave us no room to cover any additional shortfalls or unexpected emergencies."
How did this happen? How can the City possibly be broke?
Greuel and others will try to convince you it’s because the DWP has decided not to transfer $73 million of power revenues to the City’s reserve fund.
Don’t buy that "explanation" for a minute. The City’s budget is $6.9 billion. The $73 million from the DWP represents just 1.05% of that figure. A city run by even marginally competent people does not run out of cash merely because revenues fluctuate by a paltry 1.05%.
The real reason the City is bordering on broke is easy, and the arrival of today’s cash crisis was not only foreseeable, but
foreseen: Antonio Villaraigosa and the City Council have been overspending by hundreds of millions of dollars per year since at least October 2005. City revenues are actually at the third-highest level in history. The problem isn’t a lack of revenue, but an irresponsible excess of spending, year after year after year.
And yours truly documented this two years ago. That’s right: I was telling anyone who would listen that the City was on a dangerous course of overspending according to the City’s own budget documents and reports. I quoted from memo’s issued by the City Administrative Officer dating back to October 2005.
Nearly 72,000 people got the message and voted for me for Mayor, despite the local media’s news blackout on my campaign.
If the local media had actually covered my mayoral campaign, instead of arrogantly deciding to ignore it, our City would not be teetering on bankruptcy. Instead, the city’s newspapers, TV stations and radio stations chose -- with two notable exceptions -- to cover only "serious" politicians like Villaraigosa.
Thanks a million -- no, thanks a BILLION -- fellahs. On Cinco de Mayo, we’ll all raise our Margaritas to you and the Spring Street Gang, even as we speculate as to the exact date on which the City declares bankruptcy.
Meanwhile, there’s a group of people at RecallCityHall.org that should have their Mayoral recall petitions ready to roll on April 24 or so.
I can hardly wait to sign.