The city of Los Angeles saw a modest 2.9 percent growth in revenue in the 2015-16 fiscal year, which is not as strong as in previous years, according to a preliminary financial report released Thursday by Controller Ron Galperin.
Galperin’s review of the city’s 2015-16 fiscal year found that revenue grew by $148 million for the city. Property tax revenue growth came in flat and was partly made up for by a record-setting 14 percent growth in hotel tax revenue.
Meanwhile, expenses were up $273 million, which includes a $85 million increase in salaries and an additional $44 million in liability claim costs, according to the report.
The city was able to stem about $33 million in further expenses through debt restructuring, the report said.
The city also fell behind on its reserve fund goals, beginning the 2016- 17 fiscal year with the “lowest year-start reserve fund since 2012-13, reversing a three-year trend of growth,” the controller’s financial analysts wrote.
The city put away 5.99 percent of the budget, or $334.2 million, into the reserve fund, which barely surpasses the five percent policy goal.
Galperin wrote that his report “demonstrates that the city’s fiscal condition continues to be strong,” but “revenue is not growing as quickly as it has in prior years, and the reserve fund is only slightly above the five percent goal established by policy.”
“These two factors dictate caution as the city proceeds into another fiscal year certain to feature unanticipated needs and high-priority policy discussions,” he said.
The controller’s report can be found at http://www.lacontroller.org/fy_2015_16_preliminary_financial_report.
–City News Service