L.A. Can’t Keep Spending Money It Doesn’t Have : City finances: Settling the King case, giving police a raise and unfreezing hiring would add millions to the deficit.

If the city is facing its worst fiscal crisis in 60 years, one wouldn’t know it from some of the advice the City Council has recently received. We have been urged to settle Rodney King’s civil lawsuit against the city, find a way to give our police officers a pay raise and give general managers total flexibility in hiring and promoting employees in their departments.

Each of these recommendations would cost the city treasury millions of dollars and confirm the adage that “It’s easy to be generous with the public’s money.”

* Rodney King case. Few would argue that a settlement would be preferable to another lengthy trial. The question is: At what price?

At first, King’s lawyers demanded $5.95 million to settle. This would have been the largest amount the city has ever paid to any individual to settle a case. After careful evaluation, the city made an offer of $1.25 million plus attorney’s fees. Under our proposal, King would get $250,000 now and $75,000 a year for the rest of his life. Since the city made its offer, King’s demand has ballooned to $9.5 million.

The city wants to and should make King whole for the injuries and suffering he sustained on that fateful night in Lake View Terrace. We believe that our offer not only compensates him for his pain and suffering, but goes well beyond what we would normally pay to a plaintiff with comparable injuries.

The most the city has ever paid in any settlement was $5.5 million, when a plaintiff was rendered a paraplegic in a mistaken police shooting. When the city agrees to pay as much as we’ve offered King, $1.25 million, the plaintiff has usually suffered serious, permanent injury or even death. Fortunately, King has suffered neither.

It’s hard to argue with the contention that the last thing the city needs is another Rodney King trial. But it is precisely this fear that King’s attorney is counting on to “persuade” the city to pay his high price. Succumbing to this pressure would set a horrible precedent, virtually advertising open season on the city treasury.

* Police pay raises. Most would agree that the courageous men and women of our police department deserve whatever we can afford to pay them. The problem is that there is no money for salary increases--for police, firefighters, paramedics, garbage collectors or other critical city employees.

Pay raises for city employees are extremely costly and hard to justify given our growing deficit. This year, each 1% increase in pay to employees will cost the general fund $16 million, adding to the $230-million shortfall. Even without the deficit, we would be faced with the difficult choice of giving officers a raise or using the money to hire more officers. For most Los Angeles residents, this would not be a close call. They want more police.

Los Angeles, like most cities, finds itself in a financial mess not only because revenues have been dropping for four years due to the recession, but also because the city is spending beyond its means. This must stop.

* Hiring and promotion freeze. Our critics suspect that the city hiring freeze is an insidious effort to micromanage each department, including the LAPD. On the contrary, the hiring freeze was imposed in order to save money, and it has saved taxpayers more than $10 million per year.

In most departments, the promotion freeze has resulted in significant savings by averting the tendency of some managers to promote their subordinates whether the promotions were needed or not. This reduces the number of workers who directly serve the public, while adding to the already bloated ranks of the more highly paid supervisors. By lifting the freeze, we are risking a return to the old ways of bureaucratic top-heaviness that helped get us into this fiscal mess to begin with.

The advice we’ve been receiving has one common theme: Spend the taxpayers’ money, even if it isn’t there; worry about where to get it later. This is bad public policy, bad fiscal policy and, if adopted, will send Los Angeles into bankruptcy.