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Vernon's rocky finances worry L.A. County supervisors

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Los Angeles County supervisors voted Tuesday to order an investigation of Vernon's finances amid worries that an effort to dissolve the city might unfairly burden county coffers.

The inquiry followed a report in The Times on Sunday that outlined a steady decline in the city's finances since 2005 due to swelling debt, dwindling revenues and increased spending on salaries, benefits and legal fees.

Assembly Speaker John A. Pérez (D-Los Angeles) has sponsored legislation that would eliminate Vernon's cityhood and make the area an unincorporated part of Los Angeles County. Pérez has also introduced a companion bill that calls for a new special district overseen by the county to take over some parts of Vernon’s government.

Supervisor Zev Yaroslavsky said the city's debt load might mean that Sacramento efforts to dissolve the scandal-plagued city are "booby trapped" with financial problems "that we would have no capacity to deal with."

County Chief Executive William T Fujioka will report next week on what the deal might mean for the county and will make a recommendation on whether the county should publicly endorse or oppose Pérez's plan.

"Without changes, we have communicated that we cannot support the bills. There are some really strong fiscal concerns," Fujioka said.

Yaroslavsky urged Fujioka to come out more strongly in opposition or in favor of the legislation and said "it's a little late to be doing this kind of analysis."

John Vigna, a spokesman for Pérez, said the speaker’s staff had been discussing details of the companion bill, AB 781, with the county for the last several weeks. The bill, which was introduced to address complaints from business and labor leaders in the city, would create a Community Services District in Vernon that would absorb its fire department and electric utility.

County officials are concerned about provisions in AB 781 that would restrict their ability to levy rate increases for the next five years. They are also wary of Vernon’s outstanding debt and long-term obligations, including a 15-year supply of natural gas the city purchased in 2006.

But Vigna said the speaker is still confident the plan will be passed by the Legislature before its session ends Sept. 9.  

“I think we’ll ultimately get to a very good spot with the county and get the bills out,” he said.

RELATED:

Complex financial deals and energy projects cost Vernon millions

Vernon pays former administrator $500000 to settle contract provision

Vernon paid millions to companies connected to family members of city officials

-- Garrett Therolf and Sam Allen

Photo: City of Vernon. Credit: Los Angeles Times

 
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