Budget committee adopts CLA recommendations to raise reserves, delay some hires and direct follow-up reports

The Los Angeles City Council Budget Committee adopted the Chief Legislative Analyst27s (CLA) report as amended, voting unanimously among members present to boost the city27s fiscal reserves and defer certain hiring and new contracts as the city prepares for potential revenue losses from pending ballot measures.

The committee chair said the CLA recommendations "bring our reserve fund up from 5% to 6% and increases the budget stabilization fund for a total of approximately 9% in total reserves," framing the changes as a precaution against uncertainty ahead of November ballot measures that could remove roughly $1 billion in revenue.

Andrea Galvin of the CLA27s office walked members through the report27s numbers, saying the office identified about $80 million in revenues and recommended expenditure changes that produce a net near $29 million through a combination of increases and reductions. "The first page begins with revenue changes... On this page, we see business tax, utility users tax, licenses, permits, fees, and fines," Galvin said as she summarized key line items.

The package includes a short-term hiring deferral for many non-public-safety positions, a process for the CAO to implement a personnel freeze and an administrative "unfreeze" resolution to return to council for exceptions. Committee members sought clarity on scope: a councilmember asked whether the hiring delay would include sworn public-safety hires and was told the delay generally excludes LAPD and other core public-safety hiring, though some public-safety-adjacent positions could be evaluated for exceptions.

Councilwoman Heather Hutt asked to exempt parking enforcement and traffic control officers from the hiring delay, arguing they perform critical functions; the CLA said it would coordinate with the CAO to evaluate exceptions for roles that are revenue-generating or directly tied to public safety.

The committee also approved a set of technical amendments and instructions recorded in Exhibit H that direct greater scrutiny and follow-up reporting. Those instructions include a CAO review of whether opioid settlement funds could be used for HIV prevention and related services tied to the TGI wellness and equity initiative, and a request for a CLA/CAO/City Attorney consultation on the city27s potential liabilities and options regarding LAHSA governance before any related actions are adopted.

Councilmembers debated the proposed Clean Corridors program, with Councilmember Marquee Hernandez proposing a technical amendment requiring a report back that defines lead departments, compares the model to existing programs and outlines performance metrics and costs. Hernandez said the amendment would prevent duplication and ensure coordination between departments and council offices; other members proposed the program could be designed to enable Care Plus-style teams where appropriate.

The fire department staffing proposal drew sharp attention. Councilmember Nadezhda Hunt urged adding larger recruit classes to reduce forced overtime, saying adding recruits would "go a long way towards dealing with some of the forced ... overtime staffing issues." CLA staff cautioned that a straight swap of overtime dollars for full-time positions may increase long-term costs—pensions, healthcare and other associated funds mean a salaried hour can be more expensive than an overtime hour—and recommended preserving discussion of recruit classes for Exhibit H and a midyear review.

On homelessness and LAHSA funding, the CLA clarified technical changes to LAHSA street strategies and access center funding, listing partner providers (Midnight Mission, Downtown Women27s Center, Salvation Army, Watts Labor Community Action Committee and others) and confirming that programmatic clarifications could be incorporated in the committee27s forthcoming memo and accompanying reports.

Clerk roll call recorded five ayes among the members present and the committee adopted the report as amended. The chair thanked CLA and CAO staff, city departments and community advocates for their work during the hearings and noted that many of the committee27s instructions will require later reports or technical follow-up.

Next steps: the adopted amendments and Exhibit H instructions will be incorporated into the committee27s final report and related follow-up memos; several items (hiring exceptions, specific recruit-class funding and Clean Corridors design) were sent for further analysis and report back before any definitive implementation.