Secession Threat Gets New Respect

In a sign of growing concern at City Hall that voters might carve Los Angeles into smaller cities, Mayor James K. Hahn and the City Council are preparing to start negotiations on terms of separation for the San Fernando Valley.

The bargaining over how to break apart Los Angeles would give Hahn and the council a voice in shaping a Valley cityhood proposal that could go before voters in November 2002.

At stake are police and fire protection, the water and power systems, garbage pickup, sewage disposal and every other facet of a city government that collects and spends nearly $5 billion a year.

To avoid hurting what would remain of Los Angeles, city officials think Hahn and the council should play as large a role as possible in defining exactly what goes on the ballot.

For months, a team at City Hall has been analyzing what they see as potential damage that Valley secession could inflict on the Westside, South-Central and the rest of Los Angeles south of Mulholland Drive. Their top concern is a potential shortfall of money to trim trees, pave streets, buy library books and provide other basic services.

Hahn spokeswoman Julie Wong said Wednesday that the mayor was consulting with city officials on how to begin breakup talks with leaders of the Valley VOTE secession group. Hahn opposes secession, but favors putting the proposal to a vote.

“Mayor Hahn thinks that it would be constructive for the city to participate in the negotiations,” she said.

That willingness is a major turning point in the movement to create a new Valley city of 1.4 million people. For years, City Hall leaders have viewed Valley separatists as more of a political nuisance than a genuine threat. Now, the city plans to negotiate with them over its share of the municipal treasury.

Next week, a City Council committee could vote on an expected staff recommendation to begin negotiations with Valley VOTE. Any agreement reached at the bargaining table would be subject to approval by the Local Agency Formation Commission, a state entity that redraws municipal boundaries in Los Angeles County. The commission would set the final terms of any ballot proposal.

Valley VOTE Chairman Richard Close likened City Hall’s step toward negotiations to a spouse coming to terms with an inevitable divorce.

“Oftentimes, in the first part of the divorce process, the parties don’t recognize that the marriage is breaking up,” he said. “Later on, they do realize the marriage is breaking up, and then they start focusing on the division of assets, the alimony and the nuts and bolts of the process. That’s what’s happening here. Everyone recognizes that the vote [on secession] is going to occur.”

Yet a ballot measure on secession remains uncertain. LAFCO’s nine-member board plans to decide in March whether to put the proposal before voters. Both supporters and opponents of a city breakup say the commission is likely to approve the referendum, but it could still face a court challenge.

In the meantime, LAFCO is preparing an enormously complex blueprint for secession. The first draft, released in March, divided up parks, libraries, fire stations, garbage trucks, police cars, street sweepers, lifeguards, paramedics and crossing guards.

A revised version of the plan is to be released next week.

LAFCO’s initial proposal found that the robust tax base in Northridge, Encino and the rest of the Valley would produce $1 billion a year in revenue, more than enough to sustain the proposed 222-square-mile city. To compensate the rest of Los Angeles for its loss, the Valley city would have to pay $68 million a year in “alimony.”

City Hall has raised a host of objections to the plan, all of them potential subjects of negotiation.

At the top of the list is the proposed alimony: $68 million is too low, officials say.

Another issue is the shift of cash flow to a Valley city. City officials say Los Angeles stands to gain or lose up to $80 million--enough to buy 3,200 police cars or 3 million library books--depending on how the transition is structured.

“Everyone needs to understand how the revenue flows in, when it flows in and who claims to own it when it comes in,” said Ellen Sandt, an analyst at the city Office of Administrative and Research Services. “Who gets the money? The old city or the new city? Or do you split it? That hasn’t been addressed.”

The City Council voted Wednesday to hire a consultant to study the cash-flow issues.

Valley VOTE has many of its own issues to raise at the bargaining table. Among them is LAFCO’s conclusion that a Valley city would have to contract with Los Angeles for water and power. Valley secessionists had sought to share ownership and control over the L.A. Department of Water and Power.

Separately, the city is weighing whether to start negotiations on the proposed secession of the harbor area from Los Angeles. Creation of the new harbor city of 140,000 people would have far less impact than Valley cityhood on services in the rest of Los Angeles.

A preliminary LAFCO fiscal study has found that revenue in a harbor city would fall well short of the $159 million per year it would need to function. The new city would plunge at least $109 million into the red within three years, requiring substantial cuts in services, the study found. Unless LAFCO’s final study on harbor cityhood finds a way to close the gap and maintain “a reasonable reserve” for at least three years, LAFCO cannot put the proposal on the ballot.