Costs of Services During Riot Add to Budget Crisis : Government: City emergency expenses run at more than $2 million a day. Loss of tourism, sales and property tax revenue contributes to fiscal dilemma.

Los Angeles city officials struggling to rebuild vast areas of the community after last week’s rioting face a financial double whammy: exorbitant bills for police and fire services falling due on a city treasury already facing substantial drop-offs in taxes.

The predicament only deepens a budget crisis that had been called the worst in the city’s history. Last month, Mayor Tom Bradley’s office projected a $183-million deficit for the fiscal year beginning July 1.

To help close that gap, Bradley proposed reductions in police and fire services--services that many city leaders say the riots showed to be already dangerously thin.

Although the accounting has barely begun, city officials estimated losses of at least $15 million in property and equipment during the rioting--most of it burned transformers, power lines and utility poles. In addition, as of Monday, the city owed at least $12.9 million for police and firefighting efforts, most of it overtime pay.

And emergency service costs continue to accumulate at more than $2 million a day, said officials in the City Administrative Office.

Other government agencies also are contributing substantially to the massive law enforcement alliance that descended upon the region.

The state of California estimated its costs for the deployment of the National Guard at $1.5 million as of Monday, according to Guard Brig. Gen. Daniel Brennan.

Los Angeles County pegged its additional law enforcement expenses at $500,000 a day, and the federal government estimated the costs of deploying Army and Marine troops to the area at $1 million a day.

But it is the city of Los Angeles that will bear the brunt of the economic misfortune, officials said.

In the short run, the city can draw on more than $90 million in reserve funds to pay for emergency services, City Controller Rick Tuttle has said. But it is the long-term deprivation to the city’s economy that troubles city officials.

The effect of the riots is “going to lead to a loss in sales tax revenue, a loss in tourism and (hotel) bed-tax revenue and, above all, it’s going to cut into property tax revenue when all those (damaged) properties are reassessed,” said City Councilman Zev Yaroslavsky, chairman of the council’s Budget and Finance Committee.

He added, “This is the last thing we needed at this time, with the budget crisis.”

Today, City Administrative Officer Keith Comrie is scheduled to release a report predicting how much tax money might be lost. The city’s sales and business taxes had already plunged two years in a row, marking the longest local economic downturn since World War II.

Hints of the expected decline in tourism have already materialized.

Six major travel agencies in Japan stopped booking large tour groups into the city last week. “They control the lion’s share of the (group travel) business in Japan,” said Michael Collins, spokesman for the Los Angeles Convention and Visitors Bureau.

On the expense side, damage estimates were still filtering in Monday from city departments. The Department of Water and Power reported by far the largest loss--$12 million in equipment that brought electricity to homes and businesses.

“That is only the beginning. We have just begun to assess it,” DWP spokesman Ed Freudenburg said. “We have at least 50 power poles down, for starters. It could go into the tens of millions of dollars.”

The city also suffered the total loss to fire of two branch libraries in South-Central Los Angeles. Both had been temporarily quartered at mini-malls targeted by arsonists.

Including looting and vandalism at several other branches, the libraries lost a total of $766,000, spokesman Bob Reagan said.

A field office of City Councilman Mark Ridley-Thomas was also destroyed when the mini-mall where it was housed on South Vermont Avenue burned Wednesday night. The cost of replacing the facility is not known.

An auditorium at Camp Hollywoodland in Griffith Park was also destroyed by fire. And damage was spread across a wide range of city properties and equipment--from broken windows at City Hall and police headquarters to paramedic trucks battered by vandals.

State officials, meanwhile, said it was too soon to provide even a rough estimate of the financial losses incurred by the state as a result of the riots. But they said it undoubtedly will cause the state to lose millions of dollars in sales, income and alcohol and tobacco tax revenues and will directly affect budgets in a wide range of agencies, including law enforcement, motor vehicles, social services, tax services and transportation.

“We really don’t have any idea right now of the costs,” said Cindy Katz, a spokeswoman for the California Department of Finance. “But we do know it couldn’t have come at a worse time. This is the last thing the people of California needed.”

She noted that the riots will cause a loss in tax revenues at the same time they create greater demands for state services, particularly in the social service area.

Brad Sherman, chairman of the State Board of Equalization, which administers a variety of taxes, made a hurried calculation using the latest property loss estimates of $771 million from the riot and figured that the income tax loss to the state could eventually be as high as $64 million.

He said the damaged and destroyed businesses will not only have less income to report, but they will also be able to deduct their losses from any income already earned.

More immediately, he said, the Board of Equalization will have to give substantial refunds to retailers for taxes already paid on beer, wine and liquor inventories that have been destroyed.

It is unclear, he said, whether refunds would apply to looted goods.

For the city of Los Angeles, the grim financial news promises to add fuel to what already had been a heated budget debate.