The real cost of "chargebacks" as outlined by Rec and Parks

"...although (Recreation and Parks) is one of 30+ City Departments, (Recreation and Parks) alone has contributed $151 million (19%) (almost one-fifth) to reducing the City's projected budget deficit of $800 million over these last several fiscal years through paying the indirect/support costs."

What follows is the cover letter from the Department of Recreation and Parks' formal response to the Mayor's Budget for FY14. The new budget takes another $64 million in chargebacks and $8 million in other required payments away from Recreation and Parks programming.

(typos are probably our fault.)

---
April 23, 2013
Honorable Paul Krekorian, Chair
Budget and Finance Committee
City Clerk, City Hall Room 395
Los Angeles, CA 90012
ATTN: Erika Pulst, Legislative Assistant

Dear Councilmember Krekorian:

The Department of Recreation and Parks (RAP) respectfully submits this letter to assist your Committee in providing a deeper explanation of RAP's budget. In order to understand this budget, the Council and your Committee must look at the fundamental structural changes that have occurred to RAP's budget over the past seven years. During this time, a City policy shift occurred that affected both RAP and the Library Departmental budgets. It must be noted all RAP monies are "people dollars" used to enhance quality of life, resident programs helping to keep people active and healthy, and youth programs designed to build strong citizens and, thereby, encouraging youth against gang activities. The Department must be viewed as the most non-threatening public social service agency in the City of Los Angeles and a critical arm of public safety.

Summary

The Board of Recreation and Park Commissioners understands that the City has been in a dire financial crisis since Fiscal Year (FY) 2007-08 and the need exists to effect tactical solutions anually to address the City's structural deficit. While tactical decisions are critical in effecting immediate reductions, these decisions will most assuredly affect all future operations. It should be noted that I was one of the few General Managers that openly supported the Early Retirement Incentive Program (ERIP). I did this as I had extensive knowledge and practical experience with the Federal Government when the military was faced with drastic cuts in funding which necessitated the Base Realignment and Closure (BRAC) program, Also, ERIP provided a more sensible program to reduce personnel costs while maintaining the dignity of the exceptional employees of our City. As an aside, the City benefitted from BRAC with the addition of a long term lease for land associated with the former Air Force Base at both Fort McArthur and Whites Point Nike Site. Over the past few budgets, there have been many questions directed at RAP as to why cuts have had to be made, such as a reduction in pool hours or elimination of year-round pools, program reduction/elimination or fee increases (such as community gardens). A complete list of programs that have been reduced or eliminated is provided as Attachment A. These reductions are a direct result of budget decisions necessitated by the worst recession in our country's history.

Attachment B - click on image to enlarge

Since FY 2007-08, RAP's discretionary budget (that portion of the budget which provides programs and services) has been effectively slashed from 100% to 67% of total funding available (See Attachment B). This occurred through the aggressive application of a new City policy of cost recovery for indirect costs necessary to support the direct costs of providing services to millions of our City residents. This system of cost recovery was introduced benignly to recover taxpayer subsidies to golf operations and parking garages. I agreed with this effort, as the RAP General Fund should not subsidize costs that could be absorbed by the users and program payers. Since FY 2010-11, all of our golf operations and our parking garages are fully funded by users. There is no direct subsidy associated with our golf operations and parking garages. However, once this process began, further cost recovery efforts for indirect costs were directed against RAP's General Fund budgetary accounts. Since FY 2007-08, RAP's cumulative payments toward the City'S stated deficit of approximately $800 million has been $151 million or roughly 19% of the total City deficit (See Attachment C). The Department's annual operating budget from all sources is roughly $189 million or approximately 2.7% of the City's total budget of$7.2 billion. It should be recognized that these funds were "people dollars". These "people dollars" went to offset costs of program participation and to maintain City-owned facilities within our park system. The loss of these "people dollars" meant that RAP's full-time staff plunged from a high of over 2,100 to approximately 1,400 or a 30% drop. Additionally, part-time staff dropped from over 6,900 to approximately 3,500. The attached graphs (Attachments D and E) illustrate the increase in RAP funding indirect costs of operations and the decrease in funding for direct costs of operations or actual program dollars.

Attachment C - click to enlarge

In addition, under another new City policy, RAP was directed to begin "self-funding" a portion of its operational budget. This means RAP has to save a portion of one fiscal year's budget to fund next fiscal year's budget. This amount has grown from $1.25 million (FY 2006-07) to a proposed $7.0 million for FY 2013-14. This forces RAP into a constant "juggling act" and eliminates or reduces programs/services during the fiscal year that were to be provided, as approved during the budget process by the Council and Mayor.

Again, referring to Attachment A, RAP has made efforts to focus on core functions and has been forced to make decisions to reduce or cancel those activities that although felt important and even critical to the community, had to be reduced or eliminated as they did not fall within the core functions of a Charter established department. These cuts were not made willingly nor would have been made had the Department not had to absorb support costs of operations never born by RAP in over 100 years of its history. This list is expected to grow over the next several years as RAP is forced to expend more funds on indirect costs. The increase this next fiscal year alone is $4.0 million dollars for a total of approximately $47.5 million. RAP simply does not have the long term ability to continue to finance this level of indirect cost reimbursement to the City's General Fund nor can we continue to self-fund a portion of our own budget each year.

There is some good news; the proposed FY 2013-14 budget provides RAP some one-time City capital funding to rehabilitate and rebuild Celes King III pool and Lincoln Park pool and to install automated locks in restrooms. Separately from the budget process, RAP was able to identify some one-time funding to perform deferred maintenance to improve safety and reduce liability claims, continue some unbudgeted programs such as aquatics at Hubert Humphrey, G1assell,and Peck pools (for FY 2012-13 only) and continue to develop new parks under the 50 Parks Initiative. 


Staffing 

These last few years have been tough for both the residents and the employees. Reductions in costs have resulted in the ERIP, furloughs and layoffs. Fortunately, these tough reductions have kept our great City solvent. Unfortunately, these reductions have been accomplished without any ability to control the areas where employee reductions occurred. The ERIP took a whole level of experienced and critical managers with no ability to backfill through existing City forces. Currently, through both retirement and transfers to other City agencies, departments are losing another level of critical managers who in normal times would be groomed to take on increasing levels of management responsibilities. The City has also cut almost completely the influx in low cost new employees filling the roles of apprentice or low skilled trainable and valuable future leaders. This was a tactical decision to arrest the spiraling personnel and other employee costs but has had and will have severe detrimental costs in both service delivery and direct costs of doing a unit's work.

I will use only one work group in this discussion, our critical men and women who work as Gardener Caretakers. The Department employs over 370 men and women (from a high of 551) who fill the critical task of keeping our parks clean, green and safe for our patrons. The Department of Recreation and Parks has projected ahead some simple facts. The average age of a Gardener Caretaker is 52 years. Their tasks include but are not limited to: the cleaning of restrooms, children's play pits, bike path maintenance, maintenance of our parks, etc. Using a simple direct formula, the Department can expect to lose over 3-4% of these employees each of the next few years further depleting our workforce who are performing critical maintenance tasks. This not only effects RAP's operations but also has City wide implications. For example, RAP is provided funding ($2.0 million from the City General Fund) to perform landscape maintenance at City public buildings (non-RAP owned) but we can no longer shoulder this burden as we simply do not have the staff to complete this work. This is especially true given that RAP has continued to expand the number of parks, facilities and acreage which needs maintenance.

Additionally, cutting off the influx of new and low cost employees is driving our productive cost per unit of work. With the reduction in workforce and using more costly long term employees our cost per unit of work is up while our unit of work produced is down. More or increased cost per unit of work while decreasing work actually completed results in a productivity cost death spiral. Almost every workforce series and classification is affected by these facts. As we find our economy getting stronger, we need to take a more long term strategic vision on our City workforce and core functions.  

Fleet Equipment Replacement and Maintenance 

I would also like to bring to the attention of your Committee that RAP has been able to make productivity gains in our maintenance of parks and facilities by "routing" our gardeners. RAP established approximately 240 maintenance routes with assigned crews throughout the City. Instead of having stationary assignments, crews utilize large fleet equipment (trucks, large mowers, etc.) and small fleet equipment (small mowers, trimmers, etc.) to move from park/ facility to the next park/facility to perform critical maintenance tasks. These productivity gains are being threatened. Due to fleet reduction mandates, RAP has trimmed its fleet to extremely low levels and the large and small fleet equipment is aging. RAP has been informed that at least 62 pieces of equipment originally designated to be MICLA funded were pulled from the proposed FY 2013-2014 budget. Additionally, due to reductions in Department of General Services Fleet maintenance personnel, our equipment sits un repaired in shops. If this trend continues, eventually staff will not have the equipment it needs to adequately do their job.  

Conclusion 

Like other City Departments, RAP incurred budget reductions (positions cuts, layoffs, ERIP, etc.) over these last several fiscal years to help close the City's budget deficit. But RAP and the Library Department also incurred a new City policy of paying indirect/support costs which historically were paid from the City's General Fund on their behalf. The Library Department was somewhat assisted towards this effort with the passage of a voter approved ballot measure which allocated a larger percentage of the City's property tax dollars to them. However, RAP was not so fortunate and has had to absorb these costs from its operating budget at its same property tax allocation percentage. And although RAP is one of 30+ City Departments, RAP alone has contributed $151 million (19%) (almost one-fifth) to reducing the City's projected budget deficit of $800 million over these last several fiscal years through paying the indirect/support costs.

Another new City policy directed to RAP was to self-fund a portion of its own operating budget which is currently $3.8 million to a proposed $7.0 million in the next fiscal year. Our future ability to self-fund part of our own budget and pay $50+ million annually in indirect/support costs is not sustainable. We also have a large infrastructure of facilities that is continuing to age and the deferred maintenance list of items is continuing to grow. Something must be done to address these myriad of issues, or RAP could be facing tough decisions on whether to continue to provide highly subsidized community programs or to transition to a more passive park system dependent on for-profit or non-profit agencies to provide sports and community programming, which we don't believe any Angeleno wants to occur. We can turn this situation around but we must be treated more fairly in the future. Our budget dollars should be treated as service dollars to be used by our people to service the City's people. We are a critical arm of public safety and must work together to balance community needs against fiscal reality.  

Thank you for your continued support of the Department of Recreation and Parks. Should you have any questions, please contact me or Regina Adams, Executive Officer, at (213) 202-2633. 

JON KIRK MUKRI
General Manager  

ETI National refuses to publish outgoing Trail Coordinator's last message

Published as received:

TRAIL SAFETY!

Serious Concern in the Equestrian Community 

 Equestrian Trails, Inc., National chose not to publish Lynn Brown’s last message in the magazine as National Trail Coordinator.  I believe it is essential that a copy of this message is given to every member of every ETI Corral in the organization   nationally.  Lynn deserves to have her point of view published as a long time board member of ETI, and as the National Trails Coordinator for more than 15 years.

Lynn Brown’s Final ETI Trails Coordinator Message:

 “ETI’s Mission statement is “Dedicated to Equine Legislation, Good Horsemanship and the Acquisition and preservation of trails, open space and public lands.”  For years, I have successfully worked with public agencies all over the State of California to produce equine legislation, acquisition and preservation of trails, open space and public lands for the benefit of preserving the equestrian lifestyle into the future.

“I do not agree with the current direction the President of ETI is taking regarding mountain biking on crowded urban trails, or as members in a new Corral. Nor do I support his exclusion of the voices of ETI corrals in this important issue. Since January, incalculable damage has been done to ETI, not just to the members and reputation of this organization itself, but to all the equestrians in the state, and in the U.S. who are trying valiantly to preserve their peaceful bike free hiking/equestrian trails for the future.

“The best course of action is for me to resign as National Trail Coordinator. I cannot support what I consider to be a disastrous course of action.   It is very sad that ETI’s name will be now used all over the U.S. to promote mountain biking on trails.

“In the future, I will be directing my resources and knowledge toward goals that help preserve the equestrian lifestyle, concentrating my efforts throughout California. Locally, I’ll continue working with the City of L.A. and the L.A. Equine Advisory Committee among the many other open space preservation groups where I function successfully as a member.  I will be available to help any equestrian/hiking groups.  Of course, I am not abandoning the many struggles we all face, I am withdrawing my energy from ETI National.

“I am grateful for the opportunity to serve ETI for all these years.  I wish you the best of luck.”

      --Lynn Brown

Protecting the Trail User On Single-Track Trails:

Many Mountain Bikers are often after the thrill of the downhill challenge.  Unfortunately, some mountain bikers disregard and destroy trail signage and the trails, and do not consider the risks they are imposing on other trail users from their thrill seeking adventures.  On single-track trails, even the ordinary careful biker is still a danger.  The rest of us are left to figure out how to safely use the trails that we originally built for hikers and equestrians.

From Mary Kaufman:

      “ETI National has already taken a stance on this issue: ETI National, represented by ETI Trail Coordinator Lynn Brown, has been adamant about not sharing the trails and for very good reason.  It's not safe and downright dangerous!” – Mary Kaufman, President ETI Corral 54.

All the Education in the world will never  result in making single-track trails safe for  multi-use. For the horse, Instinctive Nature will kick in no matter the level of training that horse has achieved when confronted with a fast moving object, whether from in front or coming from behind, coming from above or below. The sudden and unexpected threat of a fast moving biker can undue even the highest level of training.

We are concerned that since January 2013, ETI may be going down an ineffective path with the mountain bike organizations.  These organizations  are  well funded, and so very astute and clever in placing themselves in the forefront of the battle over single-track trails throughout the United States with all government and park agencies.  If we hikers and equestrians do not voice our objections to these serious safety issues and join together to form a coalition to protect our interest in trails, we will lose all of them through our fear of an encounter with mountain bikers.

The information here is critical to the survival of ETI National.  We are  also attaching a Mountain Bike Tutorial to this email so that it becomes public knowledge.

If you have not yet heard about the tragic encounter that fellow equestrian Crystal Costa endured, we encourage you to read on:

“…in the January issue of the ETI National Magazine, on page 37, there is a full page ad regarding supporting the recovery expenses of Crystal Costa.  Crystal … a Tevis Cup endurance rider…became a paraplegic as a result of coming off her horse due to an encounter with a mountain biker. 

“One of many articles written about this incident can be viewed at: http://www.auburnjournal.com/article/injured-rider-returns-home-family-friends-horses-and-dogs

“ ‘Always find out if there is a bike race on the narrow trails and on trails where you'd never think there would be bike,’ Costa said. ‘Riding horses, riding bikes, hiking out on the multiuse trails, it's a gamble.’

“It's not a matter of "providing training" for the equestrians or, for that matter, for the mountain bikers.  It's a matter of safety.  Paraplegic Crystal Costa is very clear about that.   …those of us concerned with the safety issues mountain bikers cause will be helpless to fight it.”    [from Mary Kaufman, ETI Corral 54]

We would like your comments, suggestions, and particularly your documentation of  any incident/experience with mountain bikes– via email.

 Sincerely,   

--Stephanie Abronson, Equestrian Trails, Inc., Life Member, Corral 36

--Gwen Allen, Past National President Equestrian Trails, Inc. & ETI Corral 22

-- Sharon Richardson - President, ETI Corral 22

-- Jeffrey Davidson, ETI Corral 36

--Mary Kaufman, President, ETI Corral 54

--Elaine Macdonald, Area Trail Coordinator for the Antelope Valley and Board Member of ETI Corral 138

Overheard at yesterday's Griffith Park Resources "Board" (sic) meeting:

After reading through this laundry list of Griffith Park action items, you just have to wonder about the priority of agencies who are ostensibly tasked with the environmental health, care and protection of this urban wilderness park.

ACTION ITEMS: 

• Work on the new foot/bike/horse bridge crossing the LA River from Atwater Village into the park cannot begin until migratory bird nesting season is over, which is anticipated to be the end of July.

• Traffic study was just completed at the Zoo entrance by the Autry. Traffic calming solutions may include a traffic light. Yes, a traffic light in an urban wilderness park. Something is really wrong here.

• LA Opera wants to simulcast its opener on big tv screens on the Wilson-Harding Golf Course.   w-t-f?

• LaBonge is still talking about adding cell towers on water tanks throughout the park, same as he has been for the past four years or so.

• LAPD wants a 'public' horse arena on the Atwater Village side near the new bridge that they will have preferential use of... but the public can use it when they're done using it.

• The LA Zoo - which is on Griffith Park property - will be 'offering' preferential parking for $5. Looks like paying to park in our City parks now has a toe-hold.

• The Eco-Moron Award-winning LADWP Holiday Light Festival is finished as a vehicle event, but it may move entirely into the LA Zoo as a foot traffic event with all of the lights and noise. I'm sure the animals will love it.

• LADWP will be rebuilding the tree root-damaged sidewalks on Riverside Drive at LaBonge's behest. What do ratepayers think about this?

• the GP Senior Center in the Friendship Auditorium parking lot wants LaBonge to re purpose (? kick LA Shares out?) the building by Mulholland Fountain for an "Arts Center" that they will be using.

• LaBonge wants a trail from Lake Hollywood to Cahuenga Peak on LADWP right of away.

• After physical attacks upon both an LAPD officer and a peace officer Park Ranger by illegal flower vendors at the Forest Lawn entrance to the park, a public safety task force will be working on this issue.

• Related to the above issue, the Headworks plan calls for the removal of the fence that helps keep illegal flower vendors from completely impacting every inch of that section of roadway and park. This decision was called into question and may change.

Soboroff's parks commercialization plan completely misses the real parks funding problem

In a recent commentary on KPCC,  Parks Save chairman Steve Soboroff bemoans the huge funding cuts suffered by City parks during the past five years. Not surprisingly, Soboroff claims that the cure to these cuts is:   (drum roll)  commercial partnerships!  No surprise coming from Soboroff, but City parks stakeholders already vehemently rejected the first real attempt for blatant parks commercialization two years ago when Warner Bros tried to blanket parks with advertising for their Yogi Bear film. SoCal Connected covered the complete public rejection of this attempt in detail. So this is probably a non-starter.

In all honesty, Soboroff's push for commercialization as a cure to parks budget cuts completely missed the real issue. The truth of the matter is that recent parks budget cuts are actually a brazen and shameless violation of the Los Angeles City Charter, something Soboroff fails to acknowledge, much less address.

In 1925, realizing even then that parks are one of the first cuts made when funds become tight, the Citizens of Los Angeles saw fit to protect City parks outright from being decimated during times of economic hardship. They wrote directly into the City Charter that a percentage (.0325%) of City property assessed valuations would go directly to the Parks Department  (the Parks & Playgrounds Dept at that time) for its exclusive use. The Charter-mandated parks funds are controlled by the Recreation and Parks Commissioners solely for use by the Dept. of Recreation and Parks.


When the City Charter was updated in 2000, this City Charter mandate was continued by the People of Los Angeles, reaffirming their protection of City parks. These dedicated parks funds still constitute the majority of the budget for the Department of Recreation and Parks and parks programming today.

Unfortunately, as this most recent budget crisis hit, City officials began looking anywhere they could for new monies.  In 2008,  Mayor Villaraigosa's top aides came up with a plan to get their hands on these dedicated, Charter-mandated funds: chargebacks. The scheme would cover budget holes through charges levied on the Dept. of Recreation and Parks by other City departments under Villaraigosa's "Full Cost Recovery" plan. Their oft-quoted rationale was 'Recreation and Parks should have to pay their bills'.

And boy, did they pay! Last year a record $50 million was charged back from Charter-mandated parks funding, representing 36% of the entire fund. "Full Cost Recovery" is incremental, so the budget for FY14 will take even more of the dedicated parks funds from our parks.

The Charter mandate for City parks was enacted precisely to protect our parks from these hard times. Yet these chargebacks proffered by Mayor Villaraigosa and supported by the entire City Council completely violate this mandate of the people of Los Angeles. 

Clearly the City knows they have no legal right to chargeback these Charter-Mandated funds from either the Department of Recreation and Parks, or Libraries. The Library Dept. had the same Charter allocation as Recreation and Parks. Unfortunately, when voters passed Prop L for Libraries in 2011, they had no idea that the City had covered their legal butts on chargebacks by adding a second part to Prop L forcing Libraries "to pay their bills" - effectively removing the Charter-mandate for Libraries. But not for Recreation and Parks.

The results of the City's City-Charter violation could be devastating. Recreation and Parks has outlined the consequences of chargebacks in recent budget process documents, warning that the pursuit of "Full Cost Recovery" may ultimately result in the complete loss of the recreation function of the department (pg. 215 of this document).  Imagine no money for recreation in a city the size of Los Angeles! This is simply criminal. Yet our electeds continue to shamelessly ignore the damage from chargebacks. A lawsuit by the Citizens of Los Angeles against our own government is likely the only thing that will correct this willful violation of the City Charter and force our representatives to do the right thing.

We wrote up a full listing of the various chargebacks in FY12 with an analysis of each ( Mayor's Budget for Rec and Parks Target's LA's Most-Underprivileged ) for those interested in the detail.


You might think that, logically, the chargebacks would be equitable among the many City departments. But they aren't, hitting Recreation and Parks and Libraries by far the heaviest.

One of the chargebacks to the Dept. of Recreation and Parks (a City Department) forces them to pay the Dept. of Water and Power (a City-owned utility). Forcing the Recreation and Parks commission to "willingly" pay the Dept. of Water and Power is simply one way to launder the Charter-mandated parks funds for the General Fund through the Dept. of Water and Power. The City Council then withdraws those funds, now clean and free of the Charter-mandate and lost within lump sums in the hundreds of millions of dollars from LADWP allocated for the City's General Fund each year.

If  the Dept. of Recreation and Parks must pay LADWP, then there is one burning question that demands a public response from City officials before any new budget is signed:

If, as the City Attorney repeatedly claims, Dept. of Recreation and Parks must pay their LADWP bill the same as any other rate payer, then why doesn't the Dept. of Recreation and Parks receive franchise fees from LADWP for the thousands of acres of park land and park resources they use -- just like LADWP would have to pay to any other ratepayer whose land and resources they use?

Wouldn't this be both playing fair and helping our parks as one would hope our electeds would want to do?

Sadly, the answer is that the exchange would probably be an equal exchange, and losing those General Fund dollars nicely laundered through the Bank of LADWP is not on our electeds' agenda. That said, Eric Garcetti is a signatory to Parks Save and if elected, he must be made to keep his pledge and correct this ongoing crime against the will of the People of Los Angeles.

Frequent hiker rescues highlight need for additional Park Rangers

The four-day search and rescue of two hikers found less than a mile from their vehicles in OC's Trabuco Canyon last week has highlighted the recent significant increase in these expensive and dangerous activities. Modern Hiker has a good discussion of this issue today and LA Weekly published an article addressing this issue with some focus on City parks. Griffith Park seems to have a helicopter rescue every other week with amateur hikers going off-trail.

Earlier this week LAFD, after a third helicopter rescue above Veterans’ Park, broadcast this:

*UPDATE: Veterans Memorial Park Trailhead* LAFD helicopter hoisting uninjured boys from precarious location (2 trips w/ 3 victims each) to awaiting Fire Engine transporting to parking lot. LAFD had similar incidents last 2 weekends in nearly same location. LAFD reminds hikers to REMAIN ON TRAILS. – Erik Scott###

Calling our Mayor, CAO, City Council, Budget Chair Paul Krekorian, and Mayoral Candidates Eric Garcetti (a Parks Save signatory) and Wendy Greuel:  

If there was ever a clear argument for more Park Rangers this budget cycle, this is it.  When Park Rangers are in the field and interacting with hikers, educating hikers, and are on-site managing the sensitive resources that contain trails, the number of these types of incidents decreases. With respect to City parks in particular like Griffith, there are such few Park Rangers left right now that these parks are essentially not patrolled and are a veritable free-for all. No one is “home”, so anything goes, and this doesn’t just enable unprepared hikers but it allows vandals to damage these resources at-will.

I personally can vouch for people reaching out to resources like Rangers when they are on-site. On busy days, park neophytes who make their way into Amir’s Garden keep me from getting any work done at all with the questions about trails, preparation, distances, difficulty, wildlife, etc. And that’s A Good Thing. I answer everything and direct them to additional resources. Exactly what Park Rangers should be doing as part of their vital job duties – if we actually had any Rangers.

The bottom line is that we need a more reasonable management standard for our urban wilderness areas that is primarily proactive (Rangers, volunteers on-site) as opposed to reactive (expensive and dangerous Search & Rescue).

Time to correct this and hire more Park Rangers and a Chief Park Ranger this budget cycle.