Comments
LA'S LIABILITIES - On Friday April 3, 2026, the City Budget and Finance Advisory Committee Chaired by former City Controller Ron Galprin met at City Hall.
Though the Office of the Controller, Kenneth Mejia presented on departmental trends, City revenue sources, expenditures, liabilities and special funds; this article will mainly focus on liability claims.
The top three City Departments that rank the highest in liability claims are the LA Police, Street Services, and Sanitation.
According to Controller Mejia, the City experienced an uptick in liability claims in fiscal year 2020 during the George Floyd protests as well as when the Fireworks Explosion occurred on 27th Street in a south Los Angeles in 2021. According to https://emergency.lacity.gov, “hundreds of claims for damage are still being processed today. Councilmember Price quickly delivered a $1 million relief fund for cleanup services and to help expedite payments for repairs and damaged homes.”
However last year, the City set a record high in claim liabilities; a claim close to $20 million, resulted from the incident when an off-duty LAPD Officer shot a person inside a COSTCO store, said Mejia. Another $12 million liability claim resulted when an LAPD Officer was on her phone while driving when she ran over a woman on a wheelchair who was crossing the street, Mejia explained.
For fiscal year 2025-26, the City Controller’s Office operating fund totals $25 million -- or 0.29% of the general fund, worth $8 Billion – paying for 159 positions. “Office is struggling to do performance audits since it has 7 auditors for the entire city, and 5 investigators for Fraud. It’s difficult,” Mejia said. A decade ago, former Controller Wendy Gruel and Controller Laura Chick had up to 220-230 positions, he said. “Through charter reform, we’d like to get 0.41% of the General Fund; this would move us to $34 million and allow us to have more auditors and investigators, so our office to be more proactive,” Mejia said.
Recently, the Controller’s Office identified $23 million in fraud by a homeless service contractor; someone gave the office a tip about the services not being provided. After investigation, office found that the contractor was submitting fake receipts; The contractor was arrested in January 2026. Also, this month, the Controller’s Office found another homeless service vender who committed fraud by not providing the services under obligation. The City had already paid $500,000 and ended up losing those funds.
“This year we increased the liability claims budget close to $200 million which is more accurate, because in the past, they have [City] budgeted 78M which is inaccurate, by them having to find the funds from other areas which throws off the funds from the areas of need,” Mejia explained.
The City needs to invest in infrastructure and tackle the areas where the highest liability claims come from, broken streets, sidewalks, and broken lights. Also take greater accountability as to what is causing the highest liability claims in the police department, he said.
Lastly, in June, Angelenos will be voting on two additional local measures: The Hotel Tax targeting visitors, and the Tax on the unlicensed cannabis dispensaries that are operating illegally, Controller Kenneth Mejia announced.
(Connie Acosta participates in the Los Angeles Neighborhood Council System, Board Member of the NC Budget Advocates, speaking as an individual, and a neighborhood council treasurer.)
