Education and Neighborhoods Committee Meeting Live Blog [Updated]

[Update: You can now listen to the complete audio of Tuesday’s hearing by clicking here. Just make sure to scroll through the first few minutes of this clip to the beginning of the meeting.]

3:17 p.m.: Councilman Krekorian bangs the gavel and welcomes the crowd to the special meeting of the ENC meeting. There are about 50 people here in council chambers with Krekorian joined by CM Zine.

3:19: “We will be considering CAO recommendations of 3 three year plan,” Krekorian said. “I want to thank many of you for having stepped up and come together in your community to find ways…to create cost efficiencies and address the very important functions Neighborhood Councils serve in our city.”

3:22: Krekorian offers a sobering assessment of city’s financial hole. The city needs to find more than $600 million in budget solutions over the next 18 month, he said. “That is a huge task that will man very deep cuts in virtually every are a of public service. I’m looking forward to hearing all of your input to see how we can meet those needs together.

3:23: Zine welcomes the crowd, saying about NCs: “I want to see them continue without arguments, without hostility and with proper funding to get things done…We are concerned, just as your concerned.” Zine brings up troubles with NC treasurers as evidence that the system needs to be cleaned up. “We want to make sure there are safeguards,” he says. “No one is here to destroy neighborhood councils, but we need to be serious with how we are going to fund them.”

3:27: Doug Eberhart, Coastal San Pedro NC: “This crisis is an opportunity for neighborhood councils. There are 1,600 of us and you don’t have to worry about our contracts, laying us off or furloughs. We’ve come together in a very civil manner and understand there are bad eggs. Many of us are as severe on those thieves as you are.”

3:31: Dr. Dan Wiseman of West Hills NC: “We want to be engaged. The important thing here is the volunteerism. I encouraged you to find more ways to engage neighborhood councils.”

3:36: FYI: There will be a cavalcade of NC leaders. I won’t be able to capture all of them, but will try to summarize their views.

“We need appropriate checks and balances. NCs work all over Los Angeles on issues that concern all of us.”

3:38: Speakers saying they’re aghast at thievery of other NC members. Pleading with committee to not “cut resources to the community.” “This is my full time job,” she says.

3:39: Charles Lindeblatt, Mid-City West NC: “We are in compliance with the law and urge you not to make the cuts.”

3:44: One NC member says its time to cut neighborhood councils. “It’s outrageous that we see this is how the money is being spent.”

3:46: Mike O’ Gara, Sun Valley NC: “The neighborhood councils are teenagers. We’re starting to learn.” He says their NC has used funds to support holiday programs, school programs and public safety programs. “We should keep obe year of roll over (funds).”

3:47: Barbara Monaghan Burke, Studio City NC: “City Chart is law. It ensures NC can carry out mandated functions. Only a city charter amendment voted on by people can alter mandate that says NC have adequate funding to carry out mandate.”

3:50: Gary Johnson, Studio City NC: “To me, [NCs] are the biggest bang for your buck in any way, shape or form. [They’re funding] should be left alone. We always say police and fire are numbers one and two in order of importance. I would put NCs as number three.”

3:52: FYI: All speakers are not opining on behalf of their NCs, but for themselves. All affiliations listed do not imply sponsorship by any NC of individual thoughts.

3:59 Nina Royal, Sunland-Tujunga Neighborhood Council: “I fully support the budget committee recommendations. We can work together with DONE to come up with an excellent program. I think we can work this all out.”

4:02: A stream of other NC leaders from wide swaths of Los Angeles will reflect on their own community groups. While they do so, let’s take a few minutes to consider what we are doing here. The following are the recommendations from the city’s Chief Analyst Office. Note that they are just recommendations and not what the committee may actually enact:

• A report from the CAO regarding the transfer of the Department of Neighborhood Empowerment to another city agency and changes to the Neighborhood Council Funding Program.
• The elimination of the Neighborhood Council “rollover” policy and the transfer of $1.61 million in rollover funds to the city’s Reserve Fund.
• The elimination of the Bank Card system and conversion to a demand warrant system for remaining Neighborhood Council funds.
• A DONE, City Attorney and CAO evaluation of redefining the allowable expenditure categories for Neighborhood Council funds.
• A memo to Neighborhood Councils from the General Manager of DONE relative to a 50% reduction to Neighborhood Council funds starting in 2010-11.

That is what we are here to consider right now. Thoughts?

4:11: NCs represented here include: Westchester, Studio City, Mid-City West, Mar Vista, West Hills, Sun Valley, Sunland-Tujunga, NoHo, Venice, Reseda, Granada Hills, Atwater Village, Boyle Heights, West Adams, Silver Lake, Palms, Panorama City, Coastal San Pedro. And others. Apologies if I left any out.

4:34: More speakers are reflecting the same themes as speakers before. As you might expect, given the diverse community backgrounds, there is no unanimity, though certainly a prevailing sentiment. There is some dissension among the NCs.

4:42: We have reached the end of public comment. Committee chair Krekorian says, “That was a tremendously positive and constructive period of public comment.” We will now proceed to issue #1, transfer of NC funds.

4:47 On reorganization of DONE, CAO says that the city will need to look at ways to restructure DONE so they don’t have to reduce service levels. They say it might be in the best interest of city. Krekorian asks how cost savings could be realize. Next budget year, they say.

4:54: Community Development Dept.: We would have to retool if DONE came under our wing. We don’t have the resources to administer a city-wide program.

4:58: DONE General Manager BH Kim: “My recommendations to council, whether or not you choose to retain the departmentt as an individual entity, is to understand that NCs are a unique tool of city government. It works inside and outside city government. There are functions that the department has honed over the years to develop a culture of as much neighborhood democracy as possible. The risk of [merging DONE] is to weaken the key functions that NCs need.”

Kim is the 5th GM DONE has had, he says.

5 p.m. BH Kim: “The funding program has been a broken system since the start. You need something that is easy to use by volunteers and there’s been a lot of turnover with treasurers. On the city side, you need something that’s bullet proof.”

5:02: Changes as a result of Controller’s audit, according to Kim: 1) Eliminate petty cash program. Not punitive, but necessary, he says. 2) Separation of duties: One to keep books, one to approve payments, one to pay. Board action should be required to approve finances, he says.

5:08: Kim, on whether a non profit organization could take over some NCs to administer funding, etc: “A non profit would do it better than city government if legal issues are not a barrier. We can look at options of what certain non profits can provide.”

5:10: Zine: I want to make sure there are safeguards.

Krekorian: It’s clear to me…there has not been enough transparency. This is an opportunity to fix a system that by all accounts needs fixing. I hope that will be the result.

5:13: Board of Neighborhood Commissioners member Linda Lucks advocates for non-profit. “There’s been enough mistrust that there needs to be another entity managing.”

5:16: Board of Neighborhood Commissioners, or BONC, is comprised of seven members, each from a different background and a different part of the city. They are appointed by the Mayor, and confirmed by the City Council. The Commission is responsible for setting and overseeing policy. That includes approval of contracts, leases, and rules and regulations. The Commission holds regular public meetings every 1st and 3rd Tuesday of each month, and may hold special meetings to conduct business.

5:18: Back to public comment on this issue. We will hear public comment on each one of the five agenda items per the Brown Act, which defines parliamentary procedure.

5:24: Stephen Box, of BudgetLA, et al: “We have the opportunity to work together. It’s not something we can resolve today. We just want to make sure we are at the table to find solutions. It’s an ongoing endeavor, but it starts now.”

5:27: Doug Eberhart, Coastal San Pedro NC: The way to prevent stolen funds is to get treasurer reports from NCs every month. He then advocates for the non-profit idea.

5:30: Krekorian moves 1) that the city report back to the committee within two weeks of the feasibility of a non profit taking over NC funding, 2) making BONC the managing commission and moving DONE staff under them. “We have to move forward and study this,” Krekorian says. “We need to move. We are in a crisis.” On to issue, two…

5:34: Talking about roll-over funds that each neighborhood council has. By March, DONE should know exactly what roll over funds each NC has, Kim says. Staffing shortages could delay that, though.

5:38: The motion before us, #2, concerns the elimination of the NCs rollover policy and transferring all suspended rollover funds that now total $1.61 million to the city’s emergency reserve fund. Again, that’s just the recommendation. The committee could go in a different direction.

5:44: Jose Aguilar, Lincoln Heights NC: “I may not agree with how NCs spend their money…but I oppose you taking away our rollover funds. It’s harmful to the community.”

5:48: Krekorian: It’s clear to me this is a broken accounting system. This is a system that requires reform. Sweeping these funds into the reserve would not allow NCs what they need to meet their commitments. We need to move the funds into the unappropriated balance account, subject to certain claims. We also need a better verification process. Zine seconds and so moved to the council. On to item #3…

5:52: Item #3 concerns the elimination of the NC bank card system and convert to a system where NCs need to verify expenditures beforehand. Kim to speak…

5:56: Each NC gets $1,000 max per purchase. It’s a convenient system as it cuts down delays, but the auditing function is weak because DONE knows of each purchase three months after the fact. And thus certain problems arise, as has been documented today from a few bad actors in the NC system. FYI: NCs are required to fill quarterly audits and the controller’s office has called for a change of this system.

5:59: Krekorian asks: “Would abandoning the bank card system altogether have an adverse affect on the budget deficit?” “It could indeed,” controller’s office says.

6:02: Zine points out that NC treasurers are not required to submit financial reports to their NC board. Kim vows to change that policy.

6:05: Tony Wilkinson, Panorama City NC: What we desperately need is oversight. Punitive measures suggested by CAO will raise costs. All warrant system doesn’t make any sense. We need a partnership with DONE – we will do whatever we can to voluntarily coordinate and ensure accurate accounting.

6:12: There is a pretty wide consensus from NC folks here that they do not want to move to a demand warrant system, i.e., eliminating the bank card in favor of getting purchases approved beforehand. “Don’t save a dollar to save a dime,” one says. Still, there is recognition that there needs to be greater protections and stricter accounting procedures.

6:16: Krekorian moves that the NCs submit monthly accounting reports of bank cards to maintain the current procedure and improve transparency. Also moves that cash withdrawals from NCs be eliminated and that DONE report back, within two weeks, how that will get done. On to #4…

6:18: Number 4 is another motion relating to greater fiscal transparency for NC funds. Krekorian moves that DONE report back in 60 days and Zine seconds. Moving on to 5th and final motion.

6:20: Item 5 concerns a proposed 50% in NC funding. FYI: As with all of these motions, each one considers City Council approval.

6:23: Zine reminds folks that the amount of money NCs receives is delineated by the mayor, not the city charter. “We don’t want to gut NCs,” he says. “But there is no set amount of dollars for NCs.”

6:28: A number of speakers are slated to offer their thoughts. A brief summary of their opinions:

• Let us solicit donations from businesses and community groups;
• We’ve already been cut drastically. Any more will eviscerate us;
• We use our money to fight off City Hall and use it for outreach, Nina Royal of Sunland-Tujunga says

6:37: City Attorney confirms Zine’s assessment that the city charter does not delineate how much NCs receive.  But the charter does say that the mayor and City Council need to appropriate funds for each NC at least one year in advance.

6:43: Krekorian, to applause of chamber, recommends total rejection of 50% cut CAO had recommended. Zine does not object. Krekorian cites partnership with NCs as basis on which to move forward, calling that the “sweet spot in this issue.” Krekorian vows to continue the discussion with the city and NCs for better, more efficient and transparent ways to move forward.

6:46: Committee ends, nearly four hours after the start.

Thanks for reading and please check back here in the future for news on when the entire council will consider these recommendations. As always, your thoughts are greatly appreciated.