Fiscal Crisis Puts Long Beach Officials’ Expenses in Spotlight

Had it not been for Long Beach’s daunting fiscal problems, Councilwoman Laura Richardson’s city-owned SUV -- and her fender-bender repair bills -- might have escaped wide notice. Same with Councilman Dennis Carroll’s new office furniture, and the fact that Councilman Frank Colonna spent more than any other council member.

The expenses were part of the roughly $4.5 million the nine council members and the mayor spent during the last fiscal year, which ended Sept. 30, to run their district and City Hall offices and to help cover the costs they incur on the job. What elected officials spend is a fraction of the city’s overall annual budget of nearly $1.7 billion, and it usually doesn’t draw much notice, let alone criticism.

That changed, however, when the state’s fifth-largest city found itself in a deep financial hole last fall and had to face up to the fact that it had not been living within its means; it had been using one-time money and dipping into reserves to balance its books for about 15 years. In September, the council fired the city manager and adopted a controversial budget that cut spending by 3.5% in most departments.

Officials recently agreed on a belt-tightening plan to close a $90-million gap between revenues and costs over the next three budget years.

Even the cuts proposed after weeks of public comment -- including a 25% reduction in management and administrative staff and about $23 million in employee pay and benefit costs -- won’t be enough if the economy stays sour and the state siphons funds from cities and counties to ease its own fiscal crisis, the city’s auditor said.

Suddenly, council members’ expenses were big news.

“Even if it is a small amount, to me it speaks volumes,” longtime activist Traci Wilson-Kleekamp said. “What the public sees is that our council people go on travel junkets, get cars, spend money decorating their offices.... It is really irresponsible.”

Wilson-Kleekamp is part of a group of City Hall watchers that includes a former council member and a municipal bonds analyst. The group maintains a Web site, www.thisland-lb.org, and a 300-subscriber chat list and recently formed a political action committee.

A specialist in getting public documents through access or “sunshine” laws, Wilson-Kleekamp obtained a detailed accounting of spending by the mayor and the council and gave it to the local cyber paper, LBReport.com, which published much of the information in January. She also met with editors of the local Press-Telegram, which soon launched an investigation into officials’ use of city cars and began writing editorials about “perkmobiles” and other council spending.

Details Noted

Among the revelations:

* Colonna was the top spender on the council; the $371,000 was less than the $398,000 he had budgeted, but topped his previous year’s sum by 10.3%.

Colonna said his work with several agencies that affect the city, including the Alameda Corridor’s governing board and the Gateway Cities Council of Governments, require significant travel in the region and put extra demands on his staff.

He also said he has cut expenses by posting his quarterly newsletter on his city Web site instead of mailing it and promised to cut as much as 10% from his office expenses. He does not drive a city car; he claimed $5,400 in reimbursements for using his own car on city business.

* Richardson, who spent $2,000 less than Colonna, drives a city-owned Ford Expedition that was purchased used. The city paid for repairs to the SUV and to a Cadillac she hit shortly after acquiring the Expedition in 2001. She was headed home after a day of city-related events at the time of the accident.

As the city’s fiscal problems grew clearer, Richardson said, she took several steps to reduce her office spending while still trying to meet the needs of the city’s most diverse district -- a blend of blacks, Latinos and Cambodians. At the end of the year, she plans to turn in the city-owned vehicle and buy a car to use on the job.

“I really believe all of us are willing to do our part to rectify the city budget situation,” Richardson said, “but I think we have to be very careful not to paint with too broad a brush” and thus curtail council activities that harm constituent services without achieving meaningful savings.

Carroll, who campaigned by knocking his predecessor’s spending habits, is the only lawmaker who does not accept either a city car or an auto allowance. But he got into hot water when Wilson-Kleekamp’s documents search turned up a $5,000 tab for a couch and two armchairs for his office.

“I have mixed feelings about that,” Carroll said. “My office had a ratty old couch that I kept for three years, and when I finally decided to replace it, I was appalled at the cost of furniture. But it should last for years so, pro-rated, I don’t think it’s quite so bad.”

Carroll also estimated that he has saved taxpayers about $30,000 by skimping on other costs. He said he had set aside $20,000 for a newsletter to constituents, but recently decided to send $10,000 of that back to the general fund and gave the other half to the parks and recreation department.

Instead of printing a newsletter, Carroll said, he spends $400 a month from his own pocket to run a column in a community newspaper.

No one, however, took more heat from the local press than Councilman Rob Webb, for expenses he incurred -- and paid himself -- during an after-midnight incident in his city-provided Chrysler Sebring in December, after he had some wine.

As Webb was heading from home to a supermarket, a tire blew out. The rim was damaged, but Webb said he did not crash the car and therefore he was not required to summon a city attorney investigator to the scene. Instead, he called the city’s roadside service, which evidently summoned Long Beach police.

Webb said last week that he had a couple of glasses of wine much earlier in the evening, but was not drunk or impaired. He said it was only because officers called by the tow truck driver smelled alcohol on his breath that he accepted their offer of a lift.

A Press-Telegram editorial questioned, among other things, why the severely understaffed police department of a financially strapped city would deploy officers to give Webb a lift. Didn’t they have better things to do with their taxpayer-funded time? the editorial asked.

Webb paid the car repair bill himself, because the damage had occurred on his personal time.

Most elected officials insist that they do not abuse the system and that the effort they put into serving the city far outweighs the so-called perks. Some said they spend nearly every evening and weekend at civic events or returning constituents’ phone calls, easily working 40 hours a week or more on what is officially a part-time job that pays around $25,000 a year.

“I think people are looking for a scapegoat,” said Councilwoman Bonnie Lowenthal, who had among the lowest expenses of any council member last year. “It’s inappropriate and an insult.”

Accountability Urged

Councilman Dan Baker said council spending looms as a powerful symbol as the city begins facing hard decisions to implement the three-year plan adopted in concept last month. “A certain accountability should rest with the council,” Baker said. “But I think we are on the right track.”

Changes in council operations seem likely, including the way lawmakers’ budgets are set. Currently, each council member decides what he or she will need and submits the amount to Mayor Beverly O’Neill. O’Neill, whose office spending was $855,000 last year, reviews the proposals -- and has asked for cuts -- but the final decision rests with the council member. Critics said the amount should be the same for each council office; they want more oversight.

The city is reviewing its fleet operations with an eye to cutting costs. There are calls for reviewing the policy of providing elected officials with a choice of a city-owned car or a $450-a-month car allowance. (The mayor and four council members took the cars, four chose the allowance, and one -- Carroll -- takes neither.)

One method the council recently approved as a cost-cutting measure -- having one less meeting a month -- drew widespread derision. Several lawmakers said they view the step as an experiment and will go back to meeting every week if the change causes problems or does not save money.

O’Neill said she believes the council will tighten its own spending, citing the lawmakers’ embracing the three-year plan as a sign they understand the seriousness of the city’s financial problems.

Some of the leaders of city employee unions -- who fear they will bear the brunt of the cuts because workers’ salaries, benefits and pensions account for 70% of ongoing city costs -- have yet to be convinced.

“The simple fact of the matter is that we don’t believe they have a $90-million problem,” said Stephen E. James, president of the 830-member Long Beach Police Officers Assn. James cited the city’s practice over several years of crying poor at budget time, and then finding a pot of money at the last minute.

Len Wood, the consultant the city hired to help guide it through its financial problems, said he can understand why James and others feel the city is crying wolf.

“Because the city has been able to cover its deficits with one-time money for so long, it has created a credibility problem.

“That is one of biggest risks cities take, when no one wants to step up to the plate” and make tough decisions, Wood said.

While many cities in California and across the nation are struggling with budget cuts because of the weak economy, Wood said, Long Beach’s problem is bigger than most. That is because, for years, it hid its growing “structural deficit” (in which fixed costs outpace ongoing revenues).

“The longer you wait, the bigger the gap gets and the more trauma results when you can no longer keep it up,” Wood said.