Fiscal Crisis Needs Serious Attention by City

It’s a scary time to be a business owner in Los Angeles. We’ve got a complete meltdown of our city government as deficits soar and the city’s power agency thumbs its nose at residents and businesses by withholding money to the government – a move that many of us are not convinced is justified. Editor, Jason Schaff It’s all a mess as usual in this city, and businesses once again lose out. In case you haven’t heard the latest in what is the ridiculous soap opera of Los Angeles politics, Mayor Antonio Villaraigosa last week called for shutting down essential agencies two days a week because of the budget shortfall worsened by the Department of Water and Power taking steps to withholding a promised $73.5 million to the city’s treasury. The DWP move came after the city council wouldn’t go for the rate hike that DWP wanted – 0.7 cents per kilowatt hour. The council wanted 0.6 cents. Council members say the 0.6 cents is enough for the DWP to pay its bills. In the middle of all this, the mayor puffs up his chest and says he must close down the city to be fiscally prudent or something like that because we didn’t get the DWP money. In the meantime, businesses lose out and really wonder why they are sticking with this place. They really consider moving out of here to at least a neighboring city, maybe out of state. If the DWP gets what it wants and a total of four proposed rate increases go through, this would mean hundreds of thousands of dollars in additional costs to some businesses. And these aren’t giant businesses, just a local hotel or two would pay this much. Step back Pretty ugly. Because it’s pretty ugly, I think DWP officials, the mayor, the city council people should step back for a second and shut up with the drama. We get that you’re trying to act like you’re in control. What you need to step back and realize is if you were in control we’d never be in this budget mess. You all could have done better in using the money we’ve given you in recent years. You are seen as so incompetent right now – even if you’re new to the position. What’s at stake? Many businesses are considering moving out of Los Angeles because it is such an expensive city to do business in even without higher power bills. Other cities are dying for our companies. The Business Journal has written about this many times. At this point, I can’t think of many things to say to keep them in L.A. The way L.A. government disrespects its businesses is just incredible. We don’t deserve any of these businesses because the officials we have elected to protect our companies haven’t done so. Devise a plan How do our elected officials and appointed cronies on city boards keep these businesses from leaving? Let us know you’re serious about actually paying attention to the jobs you have been chosen to do. Right now we all think that you’re in your positions because you can’t do anything else, know somebody important, or have a tremendous ego or want to control the world (on a very small level.) How do you let us know you’re serious about fixing things? Do not raise power rates substantially (at press time it looked like a decision to raise rates was imminent) unless there’s a full detailed accounting of how the DWP uses its money. I don’t think a lot of us are convinced they use their money efficiently. Show us that you are using your money efficiently. DWP, mayor and city council stop the politics now. I lump the city council in this because they are part of the equation but I have to say they have been the most responsible in this whole ordeal. They just don’t think we should shut down the government in a knee-jerk way.Why don’t all of the parties actually get together and figure it out? Lock the door and work hard until it is figured out. That means work hard. That’s what you are in your positions for. You’re not bureaucrats. You may want to figure out a different configuration of the DWP. Is its current structure the best? Oh—mayor and city council—come up with a long-term plan to get the city’s finances in order. First item of consideration needs to be collecting those unpaid debts that amount to hundreds of millions of dollars. You’ll hear more from the Business Journal on that later. Business Journal Editor Jason Schaff can be reached at (818) 316-3125 or at [email protected].