Special Funds Sit Unused in Los Angeles While Some Officials Call for Tax Hikes

Tens of millions of tax dollars are sitting unused, even as some Los Angeles officials call for additional tax increases, according to a report released February 13 by Los Angeles City Controller Ron Galperin.

Galperin found:

  • In the last fiscal year, the city spent just 1.4 percent ($254,000) of an $18.2 million special fund dedicated to improving parks and recreation centers, a fund for the city’s bicycle plan saw just 3.3 percent of its $1.7 million balance spent, and there were zero expenditures from a $1.7 million fund that is intended to improve public safety.

  • A total of 188 of the city’s special funds, holding more than $31 million in tax dollars that could have been used for their intended purposes, haven’t been touched for three or more years.

  • The city has $3.3 million sitting in a seven-year-old fund dedicated to alleviating neighborhood traffic; $3.1 million earmarked to create affordable housing in a small geographic area; and $1.2 million in a decade-old fund called “Healthy Alternatives to Smoking.”

“We need to untangle the web of special funds to determine how billions in taxpayer dollars can be better used to achieve the city’s priorities, like building more parks and investing in affordable housing,” Galperin said.

Galperin recommended that the City Council implement standard procedures to create and evaluate each special fund, review revenue and spending plans for each fund yearly, and adopt new procedures to repurpose and close out idle funds.

California Tax Foundation   |   1215 K Street, Sacramento, CA 95814   |   916.441.0490   |   foundation@caltax.org