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Controller: Council should return city funds

February 10, 2010 7:38:34 PM PST
Millions of dollars that could be used to solve L.A.'s budget crisis have gone to council members instead. City Controller Wendy Greuel says that practice needs to stop.Part of the L.A. Wholesale Produce Market property used to be owned by the city. Half of the nearly $2-million sale price went into a councilman's discretionary fund. It can't be spent on balancing the budget.

An audit by Greuel found that $25 million have gone into council members' discretionary accounts.

This is the same council struggling to trim a more than $200-million deficit.

"What we think is that a number of properties could be sold. We need to look and make sure that this is the right year to sell it in, but going forward, I think it is important that 100 percent of it should go to the general fund," said Greuel.

Because of a temporary city ordinance, money from the sale of city property after 2008 has to go into the general fund. That way, it can be used to buy down deficits. The law expires in July 1, and the city faces a new deficit which is more than $400 million.

The Los Angeles Unified School district bought three pieces of property before the law took effect. The sale brought the city and councilmember each $1.1 million.

Jose Huizar took office after the law took effect. He inherited $1.4 million deposited by his predecessors. The man in his council seat before he took office was Mayor Antonio Villaraigosa. Now, the mayor wants the council to give up discretionary money to help balance the budget.

"I think that all of the money from the sale of any property, any public property should all go to the general fund, 100 percent of those," said Huizar.

Most of the council members have commitments for the money but appear willing to loan the city part of their funds to help avoid layoffs.

"We should look at it line by line, but I'm ready to take off my jacket and roll up my sleeves and work with the mayor," said L.A. Councilman Tom LaBonge.

His council colleagues are also working on it a little less flamboyantly.