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Compton faces possible government shutdown amid budget woes

July 19, 2011 | 11:51 am

http://latimesblogs.latimes.com/.a/6a00d8341c630a53ef01543286a23b970c-800wi

Compton's financially struggling City Hall may have to shut down if the City Council doesn't approve a new budget Tuesday night.

The council in recent weeks has twice voted down a budget that would lay off dozens of employees, including several department heads.Those voting in the majority said they wanted to see alternatives to layoffs.

City officials including City Manager Willie Norfleet and Mayor Eric Perrodin said last week that without a budget, a government shutdown could be imminent, with all city employees involuntarily furloughed except for public safety workers and other essential staff. City Treasurer Douglas Sanders said that he would not issue city paychecks this week if there was no budget appropriating the funds. City employees received notices weeks ago warning that their paychecks might be delayed.

Unions representing city employees have threatened to sue if the budget calling for layoffs is adopted. The unions contend that a resolution passed in 2009 gives the city authority to keep functioning until a budget is passed. City officials, however, said they did not have authority to operate without a budget under the city’s charter.

The city's fiscal situation is dire. Its general fund has been running deficits for the last three years. The city’s independent auditors, citing the deficits and “liquidity problems,” have questioned the government's ability to remain solvent. According to a report provided by the city, Compton’s general fund ended the latest fiscal year with a deficit of about $23 million, equal to about 40% of the city’s budget for the period. The deficit was inflated by $11.6 million because money was transferred from the general fund to pay off an accumulated deficit in the city’s general liability fund.

City Controller Stephen Ajobiewe said in an email that it would take five years to erase the general fund's accumulated deficit.

Councilwoman Yvonne Arceneaux, who has opposed the proposed budget, said she was still not prepared to support it in its current form, because of inconsistencies in the figures and questions about its legality. In particular, Arceneaux said, cutting department heads would be a violation of the city charter.

“This budget is just very disturbing to me,” she said. “My feeling is if we vote for this budget, we are in violation of the charter and we are opening ourselves up to litigation.”

The unions have proposed to avoid layoffs with an early-retirement incentive program and a series of concessions, including furloughs, forgone vacation days and changes to the employee health plan.

Also Tuesday night, the council is scheduled to vote on whether to certify a petition for a ballot initiative that would prevent the City Council from ending its contract with the Los Angeles County Sheriff’s Department without a vote of Compton residents. The petition was circulated by former City Clerk Charles Davis with financial backing from the deputies’ union. A plan by the city to bring back the Compton Police Department has been a source of controversy for the last year. The council voted to abandon the project when the city’s fiscal issues came to light.

RELATED:

Compton city workers face budget ax as council is poised to authorize layoffs

Compton Police Department to make a comeback?

Baca fights Compton's bid to police itself

Compton owes $5.7 million to L.A. County Sheriff's Department

-- Abby Sewell

Photo: A Compton resident speaks at a City Council meeting in March. Credit: Brian van der Brug / Los Angeles Times

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