Mayor Shrinks Payroll, Adds Police in New Budget : Spending: Proposed $3.9-billion plan also offers tax relief for business. Initial City Council reaction is guarded.

By JEAN MERL and JOHN SCHWADA

April 21, 1995 12 AM PT

TIMES STAFF WRITERS

Betting that he can squeeze big savings out of City Hall without hurting services, Los Angeles Mayor Richard Riordan on Thursday unveiled a $3.9-billion budget that continues his drive to beef up the police force, add favored programs, provide tax relief for businesses and shrink the city payroll.

Riordan’s proposed spending plan for the 1995-96 fiscal year, dubbed “Blueprint for a Better Los Angeles,” represents the businessman-turned-mayor’s latest run at reshaping a sprawling municipal government that he has criticized as being wasteful, and weak in battling crime and attracting jobs.

“This budget keeps us moving on our path toward a safer and more livable city, the course we have set,” Riordan said in a statement accompanying the budget.

In broad terms and specific program changes, the 143-page document pushes Riordan’s theme of reordering City Hall priorities and pursuing more creative cost efficiencies. For example, libraries would be expanded and more streets would be repaired. But about 1,200 city jobs would be eliminated, including assistants to top Fire Department officials and city planners.

“This is a customer-driven budget,” Deputy Mayor Mike Keeley said in outlining the mayor’s goals. In an afternoon briefing for reporters, Keeley used slides, graphs and a colorful new corporate-style budget summary document to make a case for the mayor’s proposals.

Riordan aides said the mayor plans to use the document in coming weeks as he stumps for his budget proposals citywide. The mayor sought to sidestep some more contentious policy battles, such as contracting out services and consolidating departments. The mayor chose to separate those debates from this year’s budget consideration, Keeley said.

The council will spend the next few weeks considering the proposal.

A prominent feature of this year’s spending package is the mayor’s efforts to work with department heads and council members to set goals for the coming year. The goals will be used to help determine how well administrators are doing their jobs, a key part of the mayor’s drive for greater employee accountability. Last week, voters gave Riordan a powerful tool--greater powers to fire department heads who do not perform.

The ambitious document calls for 600 more police officers--and is banking on the federal government paying half the costs--a move that aides said will put the mayor on track to fulfill a campaign promise to put 2,855 more officers on the streets during his first four-year term.

The budget would avoid layoffs by offering a voluntary “buyout” program for about 300 employees in positions targeted for elimination. Another 900 jobs are vacant because of a continuing hiring freeze.

Offering employees financial incentives for voluntary departures has become common in private corporations to cut costs--and has been used by Los Angeles County and some other public agencies. But such a program would be a first for the city, said City Administrative Officer Keith Comrie.

Most of the lost jobs will be in the bureaucracy’s support services or in departments, such as building and safety and engineering, that have experienced a reduced demand for services.

While the budget trims costs in some areas, it adds money to create a commission for children, youth and families and calls for $7.7 million in technological and communications improvements to bring City Hall into the computer age. Both additions were recommended by volunteer task forces of citizens appointed by the mayor.

The budget, which the mayor will deliver to the City Council today, would fund 14 new or refurbished libraries, repairs and reopens 11 damaged swimming pools, and resurfaces more than 300 miles of streets, a 28% increase. It also adds workers to the city animal shelters and sets aside $1 million more for trimming trees.

Further, the budget closes a $170-million deficit with a combination of onetime monies, including $58 million from the sale of airport lands, and savings from eliminating jobs and making productivity improvements.

Overall, the mayor’s budget proposal cuts general fund spending $98 million, enabling an overall reduction from the 1994-95 spending package, which totaled almost $4 billion.

“The budget’s brilliant,” said longtime Councilman Joel Wachs, chairman of the council’s Government Efficiency Committee. “It’s exactly what the doctor ordered--more police without new taxes or cuts in services.”

Wachs credited Riordan’s use of private sector analysts to examine city procedures and recommend ways to improve on them.

“We’ll be getting more for our bucks,” Wachs said.

Council President John Ferraro was more guarded.

“He is doing everything he can to fulfill his campaign promise of increasing the size of the Police Department,” Ferraro said, adding that he preferred to reserve further comment until he had finished reading the voluminous document.

Councilman Mark Ridley-Thomas said the mayor’s focus on safer streets, government efficiency and more livable neighborhoods was proper, but added that he wants to see more details. “He’s got the right categories. Now the question is the content,” Ridley-Thomas said.

Councilman Richard Alatorre, the recently appointed chairman of the council’s key Budget and Finance Committee, was on vacation and could not be reached for comment.

Comrie, the city’s veteran top fiscal officer, said: “I think it’s pretty impressive.” He said the savings identified are genuine, including $9.8 million in workers’ compensation savings to be realized in part through changes in state law and hiring a private administrator for the program.

Riordan’s effort to wield the budget ax is almost certain to encounter resistance, especially from the Fire Department, where the mayor has urged the elimination of 57 staff assistants.

These aides to battalion and division chiefs--all trained firefighters--earn $104,920 a year. Riordan staffers say they expect to save $5.98 million by eliminating the positions.

A study commissioned by the mayor to identify inefficiencies found much of the aides’ time was spent on duties that do not require firefighting skills. The mayor noted that similar staff assistant positions have been phased out in fire departments in 10 of 13 other cities examined.

Riordan also wants to trim 50 positions from the city’s Building and Safety Department, an agency that has seen its workload plummet during the recession and the real estate market development slowdown.

Another 112 positions are proposed to be eliminated from the city’s Bureau of Engineering.

Riordan targeted the bureau--which is responsible for the design and construction of public works projects--for some of his toughest criticism, saying the agency is “plagued by an inability to deliver projects on schedule and at a cost within industry standards.”

The mayor, who pledged during his 1993 campaign to make the city more friendly to commerce, also proposed to slash the taxes paid by business by about $22 million.

This would include elimination of a 3.75% surcharge on all business taxes and reducing by 25% the regular business tax on wholesalers and manufacturers. These two initiatives would save business about $18.7 million, Riordan estimated.

Such cuts are needed to signal that the city is serious about competing with other cities to attract and keep businesses, Keeley said. Even with the cuts, the city will still be “nowhere near closing the gap between L.A. and other cities” in providing a low-tax environment for business, he said.

Riordan, who in his private life as a venture capitalist was involved in real estate deals, also called for spending $2.7 million to implement plans to streamline the city’s cumbersome building permit system.

Unlike his budget proposal of last year, Riordan’s latest spending plan includes no provisions for privatizing city services, often a favorite conservative prescription for overhauling government. Last year, even the mayor’s modest effort to privatize the city’s parking enforcement program on the Westside was rebuffed by the City Council, which has stronger ties to city employee unions.

(BEGIN TEXT OF INFOBOX / INFOGRAPHIC)

Where City Dollars Would Go

Under Mayor Richard Riordan’s proposed budget, this is how money would be allocated:

Community Safety: 39.5

Crime control: 26.4

Fire control: 9.6

Public assistance: 1.6

Other: 1.9

Transportation: 11.9

Streets and highways: 6.7

Traffic control: 4.7

Other: 0.5