LA WATCHDOG–The City of Los Angeles is drowning a sea of red ink.
Its budget deficit for the upcoming fiscal year beginning July 1, 2017 is projected to be in the range of $200 to $250 million. This is up from the $85 million shortfall that Mayor Eric Garcetti outlined in his “Fiscal Year 2017-18 Budget Policy and Goals” memo in September.
There is also the real possibility that the cumulative budget gap for the next four years may soar to well over $750 million, up from the current estimate of $300 million.
But Eric, how is this possible if City revenues are $1 billion higher than they were four years ago and collections are projected to increase by $600 million over the next four years?
In January, the City Administrative Officer indicated that the City was looking at a potential budget deficit of $245 million for this fiscal year (2016-17). This contrasts with the “balanced” budget only six months earlier.
Expenditures rose by an unexpected…