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Category: bankruptcy

Group backing Wendy Gruel for L.A. mayor buys more TV ad time

Eric Garcetti, left and Wendy Greuel at a recent mayoral debate at UCLA.

With the television ads war in the Los Angeles mayor's race heating up, a pro-Wendy Greuel committee backed primarily by labor has purchased more than a half a million dollars of additional air time, according to city disclosure documents filed Friday.

Working Californians, an independent committee created by unions and Hollywood leaders, reported spending $525,000 to continue airing an ad it began televising last week. The spots casts Los Angeles in a perilous light, nearing insolvency, and says Greuel is the “one leader” that can fix it because of her experiences as controller, working for DreamWorks, serving in the administrations of Mayor Tom Bradley and President Bill Clinton, and being a public school mom.

FULL COVERAGE: L.A. mayor's race

Independent committees like Working Californians, which was formed by leaders of the city Department of Water and Power employees' union, are barred from coordinating their activities with candidates' campaigns. At the same time, the independent groups can accept unlimited donations, in contrast to the strict limits on the committees candidates control.

The news comes one day after an independent committee was formed to support City Councilman Eric Garcetti’s mayoral bid, and a committee backing Kevin James announced its first television ad buy of roughly $450,000.

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FULL COVERAGE: L.A. mayor's race

MAP: How L.A. County voted in 2012

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-- Seema Mehta

Photo: Eric Garcetti, left and Wendy Greuel at a recent mayoral debate at UCLA. Credit: Robert Gauthier / Los Angeles Times

Richard Riordan endorses Kevin James in L.A. mayor's race

Los Angeles mayoral candidate Kevin James speaks at a debate in Sept. 2012.

Former Los Angeles Mayor Richard Riordan endorsed Kevin James in the mayor's race Friday, a major coup for the dark horse Republican candidate who is seeking to capture conservative votes.

Riordan, who is one of the most prominent Republican leaders in Los Angeles, praised James as the only candidate who isn't beholden to labor unions. Riordan has warned repeatedly that the city could face bankruptcy if it doesn't rein in its employee costs, a claim that some mayoral candidates, including City Councilman Eric Garcetti, have dismissed as overblown.

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James has used Riordan's favorable quotes in his campaign literature but until now had not secured Riordan's official support.

Riordan said he waited because he wasn't sure at first whether James had a shot at advancing beyond the March 5 primary election. But the former mayor said James now has a chance of getting into the runoff because "people are picking up that he is much more independent than the others."

FULL COVERAGE: L.A.'s race for mayor

"He’s the only one who is truly independent of the special interest groups, especially the unions," said Riordan, who served as mayor from 1993 to 2001. "The others can't possibly run our city well because they can't make major pension changes. They are owned by the unions."

Riordan said he would donate to James' campaign but not to the "super PAC" formed by Republican media strategist Fred Davis, which aims to spend millions of dollars to elect James.

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-- Kate Linthicum at Los Angeles City Hall

twitter.com/katelinthicum

Photo: Los Angeles mayoral candidate Kevin James speaks at a debate in September 2012. Credit: Allen J. Schaben / Los Angeles Times

Mayor candidates slash rivals for "irresponsible" bankruptcy claim

Photo: Los Angeles mayoral candidates second from left, Eric Garcetti, Wendy Greul, Kevin James, Jan Perry and Emanuel Pleitez are introduced before the start of the debate at Loyola Marymount University Tuesday night. Photo: Wally Skalij / Los Angeles Times

The two City Hall veterans leading the mayor’s race pushed back against criticism of L.A.’s finances during a debate Friday, arguing that they had made progress in pulling the city back from the brink of insolvency.

The outsider candidates in the mayor’s race, Kevin James and Emanuel Pleitez, have attempted to cast the three elected officials in the race—City Council members Eric Garcetti and Jan Perry, as well as City Controller Wendy Greuel—as irresponsible stewards after the city’s reserves were drained and its bond rating downgraded following the recession.

During a mayoral forum sponsored by LA5 The Rotary Club of Los Angeles, Garcetti struck an optimistic note when moderator Gray Davis, the state’s former governor, asked whether the city was clear from the danger of bankruptcy.

FULL COVERAGE: L.A.'s race for mayor

Garcetti, who served as council president during that time, listed a series of actions that the council took to lower what had been a projected 2013-14 deficit of more than $1 billion to about $212 million. Among the reductions, he noted, were $220 million in department cuts, $263 million in pension savings, $83 million in salary savings and $61 million in workers' compensation and human resources savings.

“Anyone who says there’s not still more work to do is being irresponsible,” Garcetti said Friday. “Anyone who says we’re right on the edge of bankruptcy is being irresponsible too.

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4 candidates for L.A. city attorney spar at Hollywood forum

Sharp elbows were the order of the day as the lawyers competing for Los Angeles city attorney stumped for votes—and advantage—at a candidates forum in Hollywood on Monday night.

Held at Temple Israel and co-sponsored by the  Hollywood United Methodist Church, the forum aimed to explore how "values and ethics inform the job” of city attorney.

It was also the first time all four candidates  on the March 5 municipal  primary ballot  appeared together.  And it wasn’t long before they were  taking shots at one another or finding themselves on the defensive from questioners.

Mike Feuer, a former city councilman and state assemblyman, and City Atty. Carmen Trutanich, widely perceived as the front-runners,  bore most of the criticisms.  But  private attorney Greg Smith endured some jabs as well.  Smith is  vying with Feuer and another  private attorney, Noel Weiss,  to deny Trutanich a second term.

Trutanich and Smith  took shots at Feuer for what they saw as a critical lack of courtroom experience.  “He’s not tried a case to a jury in his life,” Smith said of the Harvard Law School-educated Feuer, who claims  he  successfully “litigated” scores of cases when he headed the nonprofit legal aid organization Bet Tzedek.    Feuer accused Trutanich of inflating his successes at defending lawsuits against the city.

 During a part of the program in which the candidates were allowed to ask questions of one another,   Feuer wanted to know why Smith had “endorsed”   a “tea party” candidate for mayor.  Smith, a Democrat, acknowledged he had  donated to  the campaign of the only Republican on the mayoral ballot, lawyer  and former radio talk-show host Kevin James, but said he had not yet decided on which, if any, candidate to endorse. 

City races are nonpartisan.

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Challenge to San Bernardino's bankruptcy to be argued in court

San Bernardino City Council votes to declare a "fiscal emergency" and seek bankruptcy protection during a July meeting. Source: Kirk McKoy/Los Angeles Times.

San Bernardino officials will be in federal Bankruptcy Court on Friday morning to rebut efforts by CalPERS, the state retirement system, and other creditors to challenge the city’s filing for bankruptcy protection.

San Bernardino stopped making payments to CalPERS, the city’s largest creditor, after filing for Chapter 9 bankruptcy protection Aug. 1, a move that city officials estimate will save more than $12 million.

CalPERs is asking U.S. Bankruptcy Court Judge Meredith A. Jury in Riverside to rule that the
financially troubled city is ineligible to file for protection and therefore must continue making payments on behalf of the city’s 1,100 retirees and current employees.

The San Bernardino Public Employees Assn. also is challenging the city’s bankruptcy filing, arguing that the city is attempting to circumvent a state law that requires cities to enter into mediation with creditors and labor unions before filing for bankruptcy. In July, the City Council declared a “fiscal emergency,” which city officials said triggered an exit clause in the law and exempts San Bernardino from that requirement.

Facing a $45.8-million budget shortfall, the City Council in November voted to slash more than $26 million in spending and freeze debt payments to keep the municipality afloat and continue to provide essential government services.

The austerity plan, a required step in the bankruptcy process, freezes vacancies in the Police Department even as the city deals with an increase in violent crime. The Fire Department's overtime budget was slashed by 35%.

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-- Phil Willon in Riverside

Photo: San Bernardino City Council votes to declare a "fiscal emergency" and seek bankruptcy protection during a July meeting. Source: Kirk McKoy/Los Angeles Times.

San Bernardino official amends his 'lock doors, load guns' remark

PenmanPicture2_1San Bernardino’s city attorney Monday hedged -- a wee bit -- his comment last week that residents should “lock their doors and load their guns” because of rising crime and cuts to the police force triggered by the city’s bankruptcy.

James Penman, known as one of the city’s more outspoken elected officials, first bristled at the suggestion that he was a fear-monger.

"As good a job as our police officers do, as well trained as they are, as effective as they are, there are just not enough of them," Penman said at a City Council meeting. "And there are too many criminals in our town."

Penman said he still believes his comment to a neighborhood group last week was sound advice but wanted to "correct some misinformation."

“When I tell people to go home and lock your doors and load your guns, I’m talking to people who own guns. Because, obviously, if you don’t have a gun in your house, you’re not going to load it," Penman said. "I do not advocate that people who do not have guns, or who do not know how to use guns, should pick up a firearm that’s been in the cabinet for years and load it. Or go out and buy one. That would be irresponsible."

Penman said there was a report of a recent home invasion robbery in San Bernardino in which the residents called police and were told that an officer was not available to respond for three hours. If residents find themselves in a similar situation, Penman said, it’s “absolutely a personal decision” about how they should defend themselves.

It wasn't Penman's first ear-popping remark. In July, after the City Council voted to file for federal bankruptcy protection, Penman alleged that city financial reports had been falsified for years, masking the city's deficit spending. Days later he amended his statement, saying he was unsure if there had been intentional wrongdoing.

Last week the City Council, facing a $45.8-million budget shortfall, voted to slash more than $26 million in spending and freeze debt payments as the municipality struggles to stay afloat as it winds through the federal bankruptcy process.

The austerity plan freezes vacancies in the Police Department even as the city deals with an increase in violent crime. The city had already stopped making payments to CalPERS, the state's public employee pension fund, after filing for Chapter 9 bankruptcy protection Aug. 1.

-- Phil Willon in Riverside

Photo: San Bernardino City Atty. James Penman. Source: City of San Bernardino

 

Bankrupt San Bernardino cuts $26 million, tries to stay afloat

PHOTOS: California cities in bankruptcy

Saying it had little choice, the San Bernardino City Council voted to cut $26 million in spending in an effort to keep the bankrupt city from dissolving and being governed by the county.

The city is already in bankruptcy proceedings and facing a $45.8-million budget shortfall. The $26 million in cuts will help the troubled city stay afloat.

The austerity plan is a required step in the federal bankruptcy process. It freezes vacancies in the Police Department even as the city deals with an increase in violent crime. The Fire Department’s overtime budget also was slashed by 35%.

PHOTOS: California cities in bankruptcy

The city already had stopped making payments to CalPERS, the state's public employee pension fund, since filing for Chapter 9 bankruptcy protection Aug. 1, a move city officials estimate will save San Bernardino more than $12 million.

“This is a document that I’m holding my nose and voting yes on,’’ said Councilwoman Wendy McCammack.

The council voted 5-2 in favor of the plan, which both Mayor Patrick Morris and City Atty. James Penman said was a mandatory step in the city’s effort to restructure its debts and repair its finances under federal bankruptcy protection.

“We have a mountain to climb here,’’ Morris said during Monday’s meeting at City Hall.

At Monday’s hearing, Councilman Chas Kelley blasted the budget-cutting plan for being shortsighted and not addressing San Bernardino’s long-term financial health, which he said depends on attracting business and expanding the middle class.

"This budget is a financial equivalent of using leeches to bleed a sick patient," Kelley said.  "There is no vision in this budget for our city’s economic renewal."

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-- Phil Willon

Photo: A view of West 3rd Street from San Bernardino City Hall. Credit: Irfan Khan / Los Angeles Times

San Bernardino slashes budget, including police and fire

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The City Council of San Bernardino, which is in bankruptcy and facing a $45.8-million budget shortfall, on Monday voted to slash more than $26 million in spending and freeze debt payments as the financially troubled city struggles to stay afloat.

The austerity plan, a required step in the federal bankruptcy process, freezes vacancies in the Police Department even as the city deals with an increase in violent crime. The Fire Department’s overtime budget also was slashed by 35%.

The city already had  stopped making payments to CalPERS, the state's public employee pension fund, since filing for Chapter 9 bankruptcy protection Aug. 1, a move city officials estimate will save San Bernardino more than $12 million.

“This is a document that I’m holding my nose and voting yes on,’’ said Councilwoman Wendy McCammack.

The council voted 5-2 in favor of the plan, which both Mayor Patrick Morris and City Atty. James Penman said was a mandatory step in the city’s effort to restructure its debts and repair its finances under federal bankruptcy protection.

At a recent hearing, federal Bankruptcy Judge Meredith Jury told San Bernardino officials that she expected the budget-cutting plan to be filed soon. Some of the city’s creditors have argued that San Bernardino does not qualify to file for municipal bankruptcy protection.

“We have a mountain to climb here,’’ Morris said during Monday’s meeting at City Hall.

At Monday’s hearing, Councilman Chas Kelley blasted the budget-cutting plan for being shortsighted and not addressing San Bernardino’s long-term financial health, which he said depends on attracting business and expanding the middle class.

“This budget is a financial equivalent of using leaches to bleed a sick patient,’’ Kelley said.  “There is no vision in this budget for our city’s economic renewal.’’

Joining Kelley in voting against the plan was Councilman John Valdivia, who objected to freezing the police force at 260 positions “in a city with all-time high crime rate levels.’’ The city currently has 299 sworn officers in the current budget, although 18 positions have been vacant.

McCammack acknowledged that many of the cuts were objectionable, but said that the council had little choice but to make the tough decisions demanded by the bankruptcy process. Failing to do so, she said, would leave to the city dissolving and being governed by the county.

--Phil Willon

Photo:  A welcome sign on 6th Street greets visitors in San Bernardino. Credit: Irfan Khan/Los Angeles Times.

L.A. union worker told members to put fake names on voter petition

One of Los Angeles' largest public employee unions admitted Tuesday that a staffer sent an email to members asking that they sign "fake names/addresses" on a petition being circulated by former Mayor Richard Riordan to place a pension initiative on the ballot.

City election law requires that the petition carry a certain number of verified voter signatures to qualify.

Service Employees International Union Local 721 made the acknowledgment in a statement criticizing Paul Kim, a work site organizer, for sending the email last week as the union prepared to kick off its campaign opposing Riordan's measure. 

"SEIU 721 in no way recommends that its members or anyone else falsify signatures on any petition,'' said Ian Thompson, a union spokesman. "We are firmly against that kind of behavior. The email in question was sent without the knowledge of the union’s leadership. The person who sent the email has been disciplined for his action."

Thompson said Kim's email likely reached "very few" members. "It was sent from his personal work account and was not an official union communication,'' he said.

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Riordan accepts police union's pension debate challenge

Former Los Angeles Mayor Richard Riordan in July. Credit: Andrew Gombert / EPAMultimillionaire businessman and former Los Angeles mayor Richard Riordan has accepted a police union's challenge to put his mouth where his money is.

Riordan agreed Wednesday to a series of three debates on the merits of a pension revamp  initiative that he is trying to get on next year's city election ballot. The measure would create a  401(k)-style retirement plan for newly hired workers instead of the current guaranteed pensions.

"Dick Riordan looks forward to the opportunity to share his views with the public about the dangerous path the city is going down when it fails to deal responsibly with its pension costs,'' his spokesman John Schwada said in a statement.

Tyler Izen, president of the Los Angeles Police Protective League, on Tuesday challenged Riordan to three public debates before Dec. 7. That's the deadline Riordan, who is bankrolling the campaign,  has set to collect roughly 265,000 signatures to qualify his measure for the May ballot. 

Izen said Riordan could choose the dates and times. Schwada said the former mayor would provide details "in the very near future."

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About L.A. Now
L.A. Now is the Los Angeles Times’ breaking news section for Southern California. It is produced by more than 80 reporters and editors in The Times’ Metro section, reporting from the paper’s downtown Los Angeles headquarters as well as bureaus in Costa Mesa, Long Beach, San Diego, San Francisco, Sacramento, Riverside, Ventura and West Los Angeles.
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