L.A. County Restructuring Increases Costs by 50 Percent. Nearly a year after Los Angeles County supervisors restructured the county's top executive office, vowing to boost accountability and efficiency, the CEO's office budget has increased nearly 50 percent, the Los Angeles Daily News reports. The budget went from $27.7 million in 2006-07 to $41.2 million this year, and five new deputy CEOs draw annual salaries of more than $200,000 each. Each deputy's executive secretary makes $73,000 a year or more.
Cal-Tax Director of Communications David Kline told the newspaper: "My sense is that if you ask the average taxpayer in the county if they favor restructuring government, they would say yes – if the restructuring is going to reduce the expenses of government, reduce the bureaucracy and actually make things function more efficiently. This seems to be heading in exactly the opposite direction. When government talks about restructuring, it always seems to lead to more costs, more overhead and more taxpayer dollars."
Chief Deputy CEO Sharon Harper said most of the budget increase didn't involve extra costs associated with the restructuring proposal. She said that of the $13.5 million budget increase, $5.6 million was for salary and benefit increases and retiree health-care costs for county workers, while $1 million was for a new county cable channel. In addition, $3.5 million went to a clean-water initiative, and $1.5 million went to operate a Healthier Communities, Stronger Families and Thriving Children program.
CEO Bill Fujioka said there has been an initial investment in the deputy CEOs and their staffs, but he has efficiency teams looking at ways to ensure the plan has a "zero net county cost impact." Mr. Fujioka is paid $310,000 a year, up 28 percent from his predecessor's salary of $242,116. He is one of a string of top county officials recently granted salaries of about $300,000 annually, including the district attorney, health director and public health director.
Ms. Harper's salary under the restructuring was increased 42 percent, from $179,721 to $255,064. The deputy CEOs also are given premium split-dollar life insurance. Ms. Harper said the county code allows only department heads to collect the benefit now, so a change in the code will be needed.
To provide an area for the new employees, the county spent $197,000 to convert a downtown Kenneth Hahn Hall of Administration conference room into two offices and to construct another office.
Mr. Kline noted that increases in salary mean a very long-term increase in pension costs: "So it's not just a short-term increase, but a major increase that will cost taxpayers for decades to come."
Supervisor Michael D. Antonovich was the only supervisor to vote against the plan last year, describing it as a "$2 million boondoggle" and a "radical shift away from representative government." He said the plan – a temporary ordinance that voters still must approve for it to become permanent – would create more bureaucracy and less accountability. (Source: Los Angeles Daily News, March 9.)
Cal-Taxletter March 14, 2008
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