ValleyVote Update for 3-30-01 |
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Reference documents
ValleyVote's original (6-1-99) Vision statement http://www.ValleyVote.org/lafco/090601data.htm
The Full LAFCO report. Here is the report in Word format and PDF We are creating a searchable and quick loading html file for our website in a few days
The Start of our effort to convert it to a more readable form section 1 only so far. http://www.ValleyVote.org/Lacity/IFA1.htm
Politics: City officials spend the day poring over LAFCO report on splitting L.A., with questions far outnumbering answers.
By MICHAEL FINNEGAN, Times Staff Writer
The new report laying out a complex plan to sever the San Fernando Valley from Los Angeles skirted many of the toughest challenges the city will face if it splits apart, city officials said Thursday. The report offered little guidance, for instance, on how to choose which city workers would shift to the new Valley city's payroll, they said.
It also cites unnamed "technical problems" to be solved in order to split thousands of city assets, from garbage trucks and gardening tools to police stations and libraries. City officials say the "technical problems" are immense and could consume much of the work force for months, if not years. "There are some things that this report just did not address, and they are big things," said Lisa Gritzner, an aide to City Councilwoman Cindy Miscikowski, who chairs the committee on secession drives.
But supporters of Valley cityhood dismissed the
concerns of city officials as overblown.
"The city bureaucrats will find 100 reasons
why they don't want their empire broken down," said Richard Close, the
chairman of the Valley VOTE secession group.
The report released Wednesday by the Local Agency
Formation Commission for Los Angeles County found that a Valley city could
sustain itself on tax revenue generated north of the Santa Monica Mountains.
But the Valley would have to pay the rest of Los
Angeles $68 million a year in "alimony" to the shrunken city, the
report concluded.
Leaders of unions that represent the city work force raised concerns Thursday on the absence of details in the report on how to choose the nearly 8,600 employees who would go to work for the Valley city. Mike McOsker, vice president of United Firefighters of Los Angeles City, Local 112, said many firefighters were wary of switching to the new Valley city's Fire Department. A key concern, he said, is that cost cutting by the new city "will come out of the hide of the people who work" for it."We're not interested in having our bargaining unit cut in half," he said.
Thousands of custodians, building inspectors and other city employees live in the Valley and would presumably not mind working for the new city. Others, however, could face troubles with child care issues or longer commutes to work if transferred to the Valley city, she said. "Do you flip a coin? Do you start with all the people whose first names start with J?" said Julie Butcher, general manager of Service Employees International Union, Local 347, the largest union of city workers.
Ellen Sandt, the financial analyst who supervises secession issues for the Office of Research and Administrative Services, said a top concern at City Hall is the report's lack of detail on potential harm to Los Angeles. It cites potential "diseconomies of scale" for both the old and new cities, and it mentions the loss of productivity for city workers assigned to oversee the transition. "It's going to be absolutely tremendous during the transition period, especially if you've got to do it in eight months," she said.
The study suggested the Valley city would be incorporated the day after a November 2002 vote on secession if a breakup is approved by voters both citywide and in the Valley. For eight months, the Valley city would function as a bare-bones administration preparing to launch operations as a full-blown city government in July 2003.
Scores of City Hall officials were poring over the report Thursday searching for potential problems. Los Angeles must maintain a certain number of police officers in return for federal law enforcement grants. Some city officials, Sandt said, would need to negotiate a deal with federal authorities to keep the money flowing to a smaller LAPD. It's one of thousands of such tasks, she said.
Already, city officials tracking their work hours have logged about $500,000 worth of time simply gathering the data for the study, she said. "That's a half-million dollars that could have been spent on providing services to people," she said.
To secession advocates, the reaction of city officials and union leaders to the report amounts to mere excuses for blocking Valley residents and businesses from gaining local control over city services. A detailed plan for splitting up the work force, Close said, is "a mechanical function" that LAFCO will address before it decides to put secession on the ballot.
"It happens every day in corporate
reorganizations," he said. "In the private sector, it's a very normal
process."
If anything, he said, dividing the Los Angeles
work force would be easier than spinning off pieces of a private company, which
can force employees to move from state to state.
He also said city officials were exaggerating the
potential loss of productivity.
"It's typical city bureaucracy," he
said. "Everything's a problem to them. They have, what, 38,000 employees?
These are details that will be handled without serious problems."
Other issues that arose Thursday as potentially major challenges in dividing Los Angeles were the city's near $10 billion in debt, and the report's warning that the City Charter would need to be changed. Eric Hoffmann, an analyst at Moody's Investors Service, said splitting the debt would be "tricky" and could face a legal challenge from bondholders. "This is uncharted territory," he said. "I wouldn't be surprised if someone had an issue with it." But he left open the possibility that a legal method could be found.
"We believe that this is the sort of thing
that can be manageable, but we need to see the details," he said.
Without specifying how, the report stated that the
City Charter would need to be changed. It also said nothing about the
consequences of voters refusing to change the charter for a city that would have
lost 48% of its land and 36% of its population.
"That's going to be a hugely sensitive
issue," said Raphael Sonenshein, who was executive director of the
Appointed Charter Reform Commission.
"This report is full of unknowns."
The San Fernando Valley could be a financially viable city should it break away from the rest of Los Angeles, according to a report released Wednesday on the fiscal impact of secession. But it's a little early for secessionists to start packing the dishes. The preliminary report produces more questions than answers on what the Valley would gain from a municipal divorce.
The analysis, commissioned by the government agency overseeing the secession process, challenges the assumption that a Valley city would be truly autonomous. The budget it lays out assumes that a new city would contract with the remaining city of Los Angeles for water, power, sewer, police dispatch, information management and employee pension services. Trying to duplicate these services--building a new sewage treatment plant, for example--would be prohibitively expensive or, in the case of redesigning the city's large-scale computer system, both costly and staggeringly complex. Secession, then, would leave a Valley city dependent on the same services that secessionists so frequently complain are inadequate, but as a customer, not a co-owner.
A new Valley city could also find itself without the assets that many secessionists assumed it would get in a divorce. The report says Los Angeles would retain certain water rights beneath the Valley and ownership of the Van Nuys Airport, assertions certain to lead to a court battle. Equally controversial is a finding that a new Valley city might have to pay yearly "alimony" of $68 million to make up a city revenue shortfall, the estimated difference between the more than $1 billion the city is estimated to have received in revenues from the Valley in 2000-2001 and $976 million in expenditures. According to the law that governs breakup efforts, a secession proposal must be "revenue-neutral" to qualify for the ballot.
Secessionists seized on the $68-million shortfall as proof that the Valley does not receive its fair share of services. However, services are not necessarily determined by geography or population. For example, police officers are deployed where there is crime. If the study reveals egregious discrepancies, the city should take steps to correct them--but in a budget of more than $1 billion, is $68 million really worth seceding over?
Debate over the merits of secession will continue as the petitioners file their final separation plan and Los Angeles its response. Late this year, the Local Agency Formation Commission will release a revised fiscal study. Then LAFCO's executive officer will issue recommendations on the secession proposal. After public hearings, the commission will vote on whether to put the proposal to a citywide vote.
"We need to all look for the wisdom of Solomon," John Walker, a secession backer, told the commissioners Wednesday. We agree--and remind him that when the two women in the biblical story asked the king to settle which was the real mother, Solomon only threatened to cut the child in two.
Report: Document says area pays more in taxes than it receives in services, but predicts breakup would cost millions annually.
By PATRICK MCGREEVY, SUE FOX, Times Staff Writers
A study that found San Fernando Valley cityhood feasible but dauntingly expensive gives secessionists some ammunition for their campaign but also provides support for those who want Los Angeles to stay together, political experts said Wednesday. The 400-page report, billed as the most extensive analysis ever of local government operations, has provided a feast for the political spin doctors on both sides of the issue. As they digested the document, political consultants and others said the analysis it contains would provide grist to the campaigns that are expected on the issue, should it ever make it to the ballot.
"A document that is fair and balanced will provide fodder for both sides, and I expect that is the case here," said county Supervisor Zev Yaroslavsky, a member of the board that is studying secession. "This is all a political question," he said. "It's window-dressed in financial and budgetary language . . . but ultimately it's a political question." And as a political question, it has something for everyone.
On one hand, secession advocates can point to the study's conclusion that the Valley pays more in taxes than it receives in services--a central plank in the Valley's long-standing grievance about its relationship to the rest of Los Angeles. On the other hand, the report concludes that the breakaway area would have to pay the remaining city $68 million a year for the privilege of independence and would end up having to contract for many of its services with the city it was leaving--undermining some of secession's rationale.
What's more, the study is a reminder that many ramifications are difficult to fathom, another potentially powerful argument for those skeptical of the proposed breakup. Experienced Los Angeles political consultants, including Rick Taylor, said the many questions raised but not answered by the report could help foes of secession build a case that there is too much uncertainty in breaking up Los Angeles.
"They can put doubts in people," said Taylor, who has managed City Council campaigns. "It's the fear factor. People fear the unknown." For instance, the report, ordered by the Local Agency Formation Commission, concluded that a Valley city would be able to contract with the Department of Water and Power and other city agencies for services, but does not settle the issue of what rates Valley residents would pay.
In addressing the need to shift a large portion of Los Angeles municipal employees to the new Valley city, the report says, "It is reasonable to expect that the city would lose some productivity as part of such a large-scale reorganization." In another section, the report says the new Valley city's costs of contracting for computer systems run by Los Angeles could exceed expectations, which might "require a Valley city to attempt to enhance its revenue generation or reduce other expenditures to meet future budgets."
Such warnings are likely to be seized on by those who will campaign against secession, said Richard Lichtenstein, another political consultant. "It is an expensive and difficult proposition," he said. "Those kinds of questions would certainly chill people and make them think twice." Political strategist Bill Carrick said the challenge for Valley cityhood backers is to use the report to show that the breakup would not harm what was left of Los Angeles. "They have to make a convincing case to voters that they are not going to suffer the loss of services and it is not going to cost them any money," Carrick said.
Carrick, Lichtenstein and Taylor are not affiliated with either side in the secession debate, though some are associated with candidates who have taken positions on the issue. Carrick, for instance, is the consultant to City Atty. James K. Hahn, a mayoral candidate who opposes secession.
Eventually, Valley secessionists will have to win support for their cause from, not only a majority of Valley voters, but also a majority of voters citywide, as required by law. Secession faces many hurdles before it could be decided by voters, with an election in November 2002 at the earliest. Within hours of the report's release Wednesday, the sides for that debate already were forming.
Mayor Richard Riordan, a leading opponent of
Valley cityhood, said that though he still needed to scrutinize the document, he
remained convinced that a breakup would be "immoral" and would
"greatly disadvantage San Fernando Valley residents."
Julie Butcher, general manager of the Service
Employees International Union, Local 347, found herself in rare agreement with
Riordan.
The union is expected to join the campaign to keep
Los Angeles together, and Butcher said the complications identified by the
report about dividing key city assets such as the DWP, Van Nuys Airport and the
emergency dispatch system are likely to help in any campaign to convince voters
to keep the city together.
"Breaking up is hard to do," Butcher
said. "Staying together is worth it."
On the other side, Valley VOTE Chairman Richard Close said the report's findings that cityhood is feasible will help his group convince voters to support a breakup. "It provides sizable ammunition," he said. Close said his cause is also helped by evidence in the report that the Valley has not received some services equal to the taxes and other revenue it pays.
Government: Area generates enough revenue to thrive and fund services as a
separate city, but would have to pay L.A. at least $68 million yearly in
'alimony,' report finds.
By MICHAEL FINNEGAN PATRICK MCGREEVY, SUE FOX, Times Staff Writers
The San Fernando Valley could survive as a robust independent city, but would need to pay at least $68 million a year in "alimony" to the rest of Los Angeles to achieve the breakup, according to a landmark report released Wednesday.
The "strong and diverse tax base" of Encino, Northridge, Studio City and the rest of the Valley would produce enough revenue--more than $1 billion a year--to cover all city functions, pay the alimony and still leave a surplus, the study found. But the report--a long-anticipated document drafted by the agency charged with supervising the breakup proposal--concluded that many key functions, such as delivery of water and power, are so intertwined that they could never be separated from the city of Los Angeles.
The report lays the groundwork for the possible dismantling of the nation's second-largest city, which would be a stunning reversal of 142 years of nonstop expansion that defined urban sprawl in America. Secession is far from certain, but the report makes it much more likely that the question will be put to a vote of the city next year, when majority approval in the Valley and in the city as a whole would be required for passage. Polls have shown support for secession in the Valley, but not citywide.
The report is packed with politically explosive
findings that will spur and shape the debate over whether voters should let the
Valley secede from the city it joined in 1915.
Most important, the document confirmed the
suspicions of separatists that the Valley subsidizes the rest of Los Angeles.
The subsidy this year, the study found, totals $123 million.
Both the report and its author, the Local Agency
Formation Commission, or LAFCO, were quickly attacked by secession foes.
"LAFCO is a very prejudiced source," said Mayor Richard Riordan said. "LAFCO is very political. It's made up of people who have axes to grind, who support the secession. I come back to the moral issue. I think it is just downright immoral to abandon the poor people of this city."
Secessionists, who have sought independence for
decades, hailed what they found useful in the report.
"What we are learning is that the Valley has
been shortchanged for years," said former Assemblyman Richard Katz, a board
member of the Valley VOTE secession group.
"I feel taken," said J. Richard Leyner,
chairman of the United Chambers of Commerce of the San Fernando Valley.
The study also offered a richly detailed blueprint for breaking apart Los Angeles. It allocated parks, libraries and police stations the way a divorce judge would split a couple's household assets. The Valley, for instance, would get two of the six helicopters used by the Fire Department for water dropping, ambulance flights and earthquake reconnaissance.
But after 86 years as the northern region of Los Angeles, the Valley is so tightly entwined with the rest of the city that it would have to rely on Los Angeles to run its water, power, sewer, computer, pension and 911 emergency dispatch systems, the study concluded.
Backbone of a Secession Proposal
The report, triggered by petitions signed two years ago by 202,000 Valley voters, will be the backbone of a secession proposal that could go before voters in November 2002. Its central finding--that a Valley city is fiscally viable--makes an election more likely than ever.
"It would appear that, at this point in time, they have an opportunity to be successful if they wish to secede," said Henri F. Pellissier, chairman of LAFCO, which will decide whether to call an election. "I think that's what the bottom line is--that there's enough money there for them to do it."
An election seems a foregone conclusion to LAFCO
member and Los Angeles County Supervisor Zev Yaroslavsky.
"Ultimately, the people will make this
decision. We owe it to them, and the city of Los Angeles owes it to us to get
this thing to the ballot for the people to vote on by November of next
year," he said.
But secession opponents, including the unions representing the city work force, are sure to mount a vigorous campaign--and perhaps court challenges--to block any breakup. [and the will of the voters]
On a visit Wednesday to Sherman Oaks, the mayor cast the issue as a class conflict. "If we have a moral conscience--and I have to believe that the people of the Valley and the people of Los Angeles have a moral conscience . . . they will vote against secession," said Riordan, who has opposed the breakup with increasing determination in recent years.
Secession supporters framed the issue in equally stark terms. Jeff Brain, president of Valley VOTE, called on Riordan and the City Council to "respect the people's right to democracy and compassionately let the people of the San Fernando Valley go."
The 370-page study was written by analysts at
Public Financial Management Inc., a consulting firm hired by LAFCO. The firm
could substantially revise the report, which cost $1.4 million, later this year.
When it decides whether to put secession to a
vote, LAFCO will also rely on findings and recommendations by its executive
officer, Larry J. Calemine, a co-founder of an earlier Valley secession movement
that collapsed in the 1970s.
Among the study's key findings: * The Department of Water and Power, the nation's largest municipal utility, could not be divided. [ValleyVote has proposed to keep the DWP together as a JPA owned by the same owners the residents of Los Angeles, both in the new city and the old.] The Valley city would have to contract with Los Angeles for the services the agency provides.
LAFCO has the legal power to order Los Angeles to provide power to Valley customers at the same rates it charges in Los Angeles, according to the report. The water issue was less clear. The Los Angeles City Charter, the study found, would allow the city to sell water to the Valley upon approval by Los Angeles voters. The report concluded that water rates would "not materially deviate from" what the DWP charges its Los Angeles customers. It did not address suggestions by city officials that Los Angeles could charge higher rates in the Valley.
* The Valley city would need to pay $68 million in "alimony" each year to what remained of Los Angeles to keep the old city financially whole, as required by law. The payment could have been as high as $123 million. But because the Valley city would not own any of the DWP, about $55 million that Valley ratepayers contribute to the city budget through their water and power bills would stay with Los Angeles.
* The report warned that start-up costs for the new city "could be substantially higher" than the $13 million the state would provide by law. It said the Valley city might need "revenue enhancements" or service cuts to close any deficits. It also said the Valley city could be liable for a share of damages stemming from Rampart police corruption cases. * Los Angeles would need to keep its airports, including the one in Van Nuys, because of federal restrictions and bond agreements.
* The Valley city would acquire 8,564 of the 34,607 municipal employees of Los Angeles. Under state law, none could be laid off and all union contracts would have to be honored. The work force that remained with Los Angeles would include 473 employees dedicated to serving the Valley city under contract.
To assess whether a Valley city would be financially viable, the report also had to consider the existing division of income and services between the Valley and the rest of Los Angeles. The findings lent substance to one of the underlying rationales for the secession debate.
The report found, for instance, that the Valley generates more [45%] than a third of the sales tax revenue that pays for DASH buses and yet has just 7% of that service's routes. Similarly, Valley residents paid for more than their share of animal regulation services, street repairs and police services. Fire Department stations and staff are allocated less controversially. Those findings quickly sparked further debate. Secessionists saw the disparity in police officers as clear evidence of bias against the Valley in the allocation of services.
Valley VOTE Chairman Richard Close cited the
report's finding that about 25% of all Police Department personnel and 27% of
those assigned to field units are allocated to the Valley.
"It's shocking," he said. "The
report verifies what we have suspected all along--that services are being
directed to other parts of the city."
Pointing to police deployment, he said: "How
can you patrol the sixth-largest city on 700 officers? No wonder crime is
escalating."
Others disagreed. County Supervisor Yvonne
Brathwaite Burke, another LAFCO member, questioned the conclusion drawn by many
secession backers that the Valley was not getting its fair share.
"Obviously, police go where there's higher
crime," Burke said. "Now, do you determine fair share based on
population, or by the level or crime in the community?"
LAPD spokesman John Pasquariello said deployment
is based on crime as well as population. The Valley had 86 homicides last year,
14% of the citywide total of 620.
With the report filled with such data, some
secession supporters argued that it would be unfair to punish the Valley by
requiring a payment equal to the subsidy the Valley has already been paying.
"We shouldn't have to pay again for services
we didn't get," Leyner said.
Mayoral spokesman Peter Hidalgo challenged the
numbers from a different perspective. He said that the raw numbers [Generated
primarily by LA City] are subject
to change once the city reviews them and that they don't give a full picture of
whether resources are fairly distributed.
"The mayor believes it would be premature for
anyone to conclude that this indicates the greatest part of services are not
going to the Valley," he said.
Hidalgo noted that much of the city's business is
concentrated downtown, [an odd conclusion when 45%
of sales tax comes from the Valley] where Valley people as well as others use the DASH
system.
William T. Fujioka, director of the city Office of Administrative and Research Services, has ordered managers of every city agency to devote their "full and immediate attention" to answering questions raised by the study. Times staff writer Annette Kondo contributed to this story.
One City or Two?
A landmark study of the potential divorce of the San Fernando Valley from the city of Los Angeles concludes the new Valley city would be economically vibrant but could not cut many governmental ties to Los Angeles. Source: Public Finance Management Inc. and the Local Agency Formation Commission for Los Angeles County
What Comes Next for the Valley City Proposal
The fiscal study of San Fernando Valley secession
from Los Angeles is a key step toward breaking apart the city. These are the
next steps:
* Applicants for Valley secession file their final
"divorce plan" within 45 days.
* The city of Los Angeles then has 45 days to file
a response.
* Late this year, the Local Agency Formation
Commission releases a revised fiscal study, which the state controller may
audit.
* LAFCO's executive officer, Larry J. Calemine,
issues a report with findings and recommendations on the secession proposal.
* LAFCO, an autonomous nine-member commission,
holds public hearings.
* By early 2002, the panel votes either to reject
the proposal, which would terminate the secession proceedings, or to put it on
the November 2002 ballot. The commission can make Valley secession subject to
conditions, such as "alimony payments." The panel would also set the
boundaries for at least 14 City Council districts in the proposed Valley city.
* Protest hearings would be held, but would be
moot unless at least half of the Valley's 581,000 registered voters filed
written protests.
* Secession would occur only if approved by both a
majority of voters in the Valley and a majority of voters citywide. A mayor and
City Council for the new Valley city could be elected at the same time.
* If court action or other delays prevent the
proposal from getting on the November 2002 ballot, it could not legally be put
before voters until March 2004.
* Proposals for secession by Hollywood and the
harbor area are following a parallel track at LAFCO and could be put on the
ballot at the same time.
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