Both good and bad news came with the final report of the City of Los Angeles’ 2022-23 Fiscal Year.

Areas of overspending and untapped surpluses were both found in the final report, but members of the committee honed in on potential uses for surpluses in the Recreation and Parks Department and the Library Department.

Most departments actually ended up reporting surpluses, but many were marginal and attributed to vacancies and salary savings. On the other hand, Parks and Recreation is projected to have an end-year surplus of $21.42 Million while the Library fund is expected to have $18.74 Million in surplus.

The Recreation and Parks surplus is significantly higher than expected in the mid-year report, coming in about $15.6 Million higher than expected, mainly due to hiring delays and lower than expected expenses. With summer activities looming, spending is expected to pick up to cover vacancies and other related expenses, and this surplus is expected in spite of this additional anticipated spending.

However, the department’s CFO pushed back against some of the projections in the report, including the approximately $4 Million that is projected for part-time salaries. She also says that money is still being moved around and spent before the end of the fiscal year.

“I do not believe it will be that high,” Recreation and Parks CFO Noel Williams said of the surplus numbers. “This is data that is based on April data.”

Committee member Curren D. Price Jr.— who represents District 9 as a Los Angeles City Councilmember — asked about the hiring difficulties the department has for its ramped-up summer activities and what could be done about it.

“Are we still in a situation where we are scrambling to identify resources to pay for our youth?” Price asked. 

Williams explained that the full-time vacancy rate in the department is around 22 percent, but the department has been active on all fronts to try and hire as many as they can for the summer season.

“Our emphasis is on entry-level right now,” she said.

A significant surplus for the Library Department was already anticipated mid-year, so the total of $18.74 Million was only $1.77 Million more than expected. Assistant Library Business Manager Heather Smith said that most of that money is already set aside for “more than 10” contracts that are currently still in the pipeline.

Other surpluses come from a similar issue that the Recreation and Parks Department is having. The job vacancy rate in the library department has dropped from 14 percent to 12 percent since the mid-year report.

As part of the report, city staff also identified approximately $65.2 Million in overspending and unfunded items in the budget, mainly coming from almost $30 Million in the fire department, almost $8.9 Million from the Liability Claims fund, and $10.5 Million in over-allocated funding to the Sewer Construction Maintenance Fund.

The Fire Department’s shortfall was the most focused on by the committee, with many of the issues coming from various unbudgeted salary and benefits payouts and payouts for overtime hours. Additionally, Fire Department staff member Sandra Okung said that the deficit is also attributed to covering delayed expenses earlier this fiscal year.

“That resulted in us ending the year with the $30 Million projected deficit,” Okung said of those delayed expenses. “If it weren’t for that, we would have been on budget.”

Several areas of overspending noted in the mid-year report were addressed by the city previously and were included in the report along with a plan to address the remaining $65.2 Million in overspending. 

This eliminated overspending includes $20.77 Million in the General Services department, $25.55 Million related to a loan for Project Homekey – a temporary housing program using purchased hotel and motel properties – and $23.23 Million in already addressed over allocations to the Sewer Construction Maintenance Fund.

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