‘Negative’ Report on Breakup Approved

Over the objections of San Fernando Valley secessionists, a panel of city lawmakers Tuesday approved a report questioning the value and costs of a breakup of the city of Los Angeles.

The report, prepared by city officials, is intended for use by the Local Agency Formation Commission, the group weighing whether to allow voters to decide the issue.

“This is just an iteration of a whole lot of questions that now go to LAFCO’s court,” said Councilwoman Cindy Miscikowski, chairwoman of the council’s Ad Hoc Committee on Special Reorganization/Secession. “These questions need to be addressed.”

Valley VOTE initially called the city report a “declaration of war.” On Tuesday, Jeff Brain, head of the group, continued to challenge the report but with less heated rhetoric, saying many of the questions raised can be easily answered.

“It should not surprise anybody today that it [the city report] is somewhat of a negative view toward cityhood and it is somewhat trying to undermine the LAFCO process,” Brain said.

LAFCO, in its own study, concluded in March that a Valley city would enjoy a $20-million surplus even after paying the remainder of Los Angeles $68 million annually to make it financially whole.

But the city’s report countered that LAFCO underestimated the cost of a municipal divorce and the negative effects on what would remain of Los Angeles. The city also said LAFCO cannot legally force Los Angeles to share control of the Department of Water and Power, and cannot set water and electricity rates.

Fred Merkin, special assistant city attorney, said during the two-hour hearing Tuesday that Proposition 218 may require a separate approval from voters to transfer the taxing authority from Los Angeles to a new city.

Councilman Nick Pacheco, who is also on the committee, said that if the city fails to follow Proposition 218 it could be subject to a legal challenge from taxpayer groups.

Valley VOTE’s attorneys believe the taxing authority issue can be settled when voters consider the cityhood measure on the ballot, Brain told council members.

The Valley cityhood backer also said there are alternative ways to ensure the DWP would continue to provide water and electricity to a new city at rates charged the rest of Los Angeles.

Miscikowski said another major hurdle is a LAFCO proposal for a Valley city to have a $5.7-million reserve fund in its $1.05-billion budget, or 0.539% of the budget, contrasted with the city of Los Angeles’ reserve of 3.3% for next year. “I’d feel uncomfortable as a Valley resident about whether the Valley reserve of one-half of 1% is enough to get started out,” Miscikowski said.