By Kip Delinger

February 13, 2012-- Sometime last year, the Los Angeles Times’ LA Extra section (the California section on Sundays) ran an article, maybe two, about the homeless issues and inevitable community conflict it spawns.

In reading the article, our response was – why would a newspaper whose finances are reported in red ink and whose "parent," the Tribune Company, is bankrupt, assign a reporter to cover those issues. Perhaps, it is just a current lack of institutional memory and the increasing laziness of the new generation of journalists (after all, it was Gore Vidal that said that next to politics, journalism is the chosen field for the lazy but ambitious).

All the Times really needed to do to save the time, effort and salary of the reporter was to haul up on the screen the many articles written 20 years ago by Nancy Hill-Holtzman for the then Westside Section of the paper. What has changed, of course, is that the rate of expenditure on programs for the homeless has grown far faster than inflation – even adjusting for a head count that "activists" have every incentive to inflate as well, because increasing the numbers argues for more feeding at the trough of government.

Of course, returning to our theme, what hasn’t changed much is that ability to actually identify the "true" expenditure related to homeless social services – as the numbers have continually been massaged and placed in the City Budget in a manner that would make some financial executives at Enron of the late 1990s and early 2000s nod in approval.

More to the point of what hasn’t changed much, but where the financial stakes have obviously become higher, is the recent matter pertaining to the future of soon-to-be former employees of the shuttered (by the State of California, compliments of Gov. Brown) Redevelopment Agency.

The City's Redevelopment Agency -- created to help rebuild in the aftermath of the supposedly devastating 1994 earthquake (quick, name a major building or structure lost other than the already dilapidated Sea Castle) -- has been happily reaping in about $60 million a year. ("Money Battles Loom Over Ambiguous RDA Law," February 9, 2012)

And until Jerry Brown spoiled the party, the agency was projected to have generated as much as $5.2 billion by 2043. There was so much money coming in that the City was paying apparently $3 million in benefits and salary obligation for the 31 employees helping spend the money.

Now, City officials must not only scramble to prove nearly $300 million in redevelopment funds has already been obligated and can't be taken by the state, I'm willing to bet they make the case that even if they lose some of that money, they need to keep the City's already bloated payroll on the taxpayer gravy train, never mind where the money will come from.

Mind you, the City just pleaded for a tax increase because of budget shortfalls. And now it would contemplate spending $3 million – likely a large portion on individuals who do not even reside in the City. Were $3 million to be spent for anything (and certainly you could argue that no such commitment should be made), you'd think it would be better spent within City limits directly or indirectly – perhaps on the schools, or how about pubic aid for the un-and-under employed in our most challenged neighborhoods.

Instead, it would simply go to reward fellow public employees at the expense of taxpayers – many of whom are under great stress. The very idea of the City sparing the ax for workers whowill no longer be needed is patently outrageous and amounts to a crass, proposed undertaking to take care of "friends" at the expense of taxpayers.

Of course, what has changed is the level of expenditures on program after program throughout the City. Some 20 years ago, one recalls, the budget – subject to great ‘stress’ as the City suffered along with California from the recession that began on the East Coast in 1990 and rolled across the U.S. seriously impacting California in 1992-1993 – was in the neighborhood of $200 million. Today, it’s two and one-half times that.

What’s really phenomenal is that were the budget adjusted for inflation (using a general CPI), it would reside in the neighborhood of $325 million. And one cannot argue that population growth should be a factor – because the permanent residents in the city are pretty darn close to the same head count as 20 years ago. But let’s factor in another $30 million to compensate for population growth adjusted, as well as for inflation. That takes us to a budget of $350 million.

So what happened? Why the extra $150 million above what would be the 1992 budget adjusted for population increase and for inflation? Remember, now to spend $500 million, a $500 million revenue stream is needed – that is, the money is coming from someone’s pocket, so one wonders where it goes. We will be taking a look at that in future columns.

And we will attempt to discover how much of that revenue stream has not gone to the "needy" or for "civic improvements" but to the very well-off public sector employees, the very folks who spend very large sums to ensure the election of City Council members approve those pay scales and benefits.

This comes at the expense of quality of life of the city’s permanent residents as the city’s politicians manage policies that allow it to pluck the goose for revenues with a minimum of hissing from residents. The trade-off is more and more commercial development that helps provide those necessary revenue streams to grow government and increase the power of the elected officials.

Perhaps we’ll all end up enlightened. But don’t get your hopes up. The last time yours truly tried to analyze the City budget many years ago, me and my partner in the project, Jan Ludwinski – an actual, real rocket scientist from JPL Labs in Pasadena, ended up thoroughly confused by all the obfuscation. With even more experience in Houdini Accounting the powers that be may still be well ahead of us. We’ll see.