In the latest financial decision, the City Council has endorsed an additional loan from the reserve fund, totaling roughly $17.3 million. This decision was made to address excessive overtime costs incurred by local law enforcement amidst recent demonstrations against immigration enforcement in the downtown area. This loan approval was decided by a majority vote, with results standing at 11-3. Funds from this loan will be allocated exclusively to the Los Angeles law enforcement’s overtime for the remaining tenure of the 2024-25 fiscal year.
As per the voting details, council members, Eunisses Hernandez, Hugo Soto-Martinez, and Ysabel Jurado were not in favor of the loan. At the time of the voting, Councilwoman Monica Rodriguez was not available. The specifics of the loan repayment remained under the purview of the city officials, who were asked to formulate a repayment plan to be presented promptly within three months from the start of July.
Just the previous week, the City Council sanctioned a $5 million loan from the reserve fund. An interesting point to note here is that it was passed using a Rule 23 motion. This particular protocol permits an item to be advanced to a vote, even in the absence of its listing on the council’s agenda. The rule gets into effect with the assent of two-thirds of the council members on condition that it is regarded as an immediate necessity by state law after the council’s agenda has been posted.
As cited in a report, the local law enforcement department requested auxiliary funding for covering the overtime of its sworn officers. Interestingly, this sudden budget crunch was a result of a ‘citywide tactical alert’. The department held back officers overtime to ensure that ample resources were available to handle situations that might escalate beyond the demonstrations.
On the account of officer’s overtime and its payment, the department sought a total amount of $22.3 million. From this amount, $5 million got the green light last week. While to close out the current fiscal year, the remaining $17.3 million was approved this week as a loan. These funds will cater to regular expenses, like their base overtime, adjusting for the Juneteenth holiday and also mandatory overtime involved in the second pay period of the stationing duration.
Protest and tactical alert overtime payable for three days will also be covered in this funding. In addition, payroll adjustments generally involved with the second payment cycle will be taken care of. It will also account for two days of the impending fiscal year which will be compensated in the new fiscal period.
According to preliminary reports, the city’s expenses associated with the protests and the subsequent law enforcement response have racked up to $32 million, thus far. Of this, the police response amounts for $29.3 million. This leaves the amount estimated for the Fire Department’s response at a cost of about $1.2 million.
Moreover, expenses that arose from emergency protective procedures implemented by the Bureau of Street Services totaled up to another $72,776. The cost associated with cleaning up debris and graffiti, rectifying structural damages and equipment repair is calculated to be around $1.4 million.
Recently on Tuesday, the City Council passed a resolution marking a fiscal emergency. Such a resolution facilitates the commencement of intended layoffs and other necessary measures aiming to address an approximate-budget deficit of $1 billion in the upcoming fiscal year. The new fiscal year anticipates the beginning of July.
The city’s spending plan for 2025-26 currently projects about 614 layoffs in an attempt to tackle the extensive deficit. This alarming budget deficit is attributed partially to overspending, the introduction of new labor contracts and escalating liability expenses concerning the complaints lodged against local law enforcement.
Legal settlements ensuing from these complaints have led to elected officials resorting to use money from the reserve fund. This fund is normally accessed in emergency situations, thus portraying the severity of the ongoing financial crisis.