L.A. Panel Clears Way for Payment of City Phone Bills

City officials moved Tuesday to rescue an agency that spent all its current funding to pay off $800,000 in late fees for delinquent phone bills going back three years.

The Budget and Finance Committee of the Los Angeles City Council approved an emergency allocation of $6.3 million to cover the cost of the late fees and pay city phone bills through June 30, but not before council members chastised managers for the embarrassment of the late-payment fiasco.

The city Information Technology Agency failed to disclose that there was not enough money in the budget to pay telephone bills on time, council members complained.

“Why didn’t we hear about it?” asked Councilman Mike Feuer. “It seems to me any manager in this city who identifies a major fiscal issue has the responsibility to bring it in a timely way to the attention of this committee.”

Added Councilman Richard Alatorre: “I don’t want to be embarrassed. I want to be forewarned.”

Agency General Manager John Hwang told the committee it had been the practice before he became head of the department for the city to provide insufficient funds for telephone services and to pay late fees to keep the phones working.

But Councilwoman Rita Walters said it appeared Mayor Richard Riordan was partly to blame for not providing sufficient money in the budget to pay the telephone bills.

An audit by the city controller last week found that agency managers did not know the amount of the late fees and therefore were not in a position to realize the urgency of plugging the funding gap.

In addition to providing funds to pay the bill through the rest of the fiscal year, the council panel recommended approval of several changes in the processing of payments to make sure managers do not allow phone bills to become delinquent.

“The priority has to be to pay the bills,” said Alatorre, the committee chairman.

The funding proposal now goes to the full council for approval.

“It’s perceived as indicative of the way City Hall does business, and I think none of us wants that to be the case,” Feuer said.