As LA Tries To Tackle Looming Budget Crisis, City Has Spent Nearly $500 Million On Liability Claims

Topline:

The backstory: Liability claims are payments the city makes to people it has injured when it’s failed to meet its responsibilities, or when officials and employees directly harm people, or fail to prevent avoidable harm. And a “significant portion” of the money comes out of the general fund, which pays for city services and resources, the controller’s office said in a statement.

These payouts are nothing new, as local city and county government has paid out massive amounts of money over recent decades.

Why now: The controller's office released the data saying it hopes it helps the city “better manage its responsibilities and avoid the kinds of risk and harm that give rise to liability claims and payments.”

Why it matters: L.A. may be heading toward a possible budget crisis. The city administrative officer warned in January that L.A. was taking in less money than forecast and spending more — some $297 million in "overspending." The biggest share of those increased costs ($97 million) is tied to a new LAPD contract, the city administrator said.

How the liability costs break down: The LAPD made up more than a quarter of the total liability claim payouts for that period — about $125 million. The Bureau of Sanitation had the second highest with nearly $94 million in payouts, followed by the Bureau of Street Services with more than $88 million.

The agencies did not immediately respond to requests for comment on the latest report.

What they were for: The highest paid liability claim categories were for dangerous conditions and traffic collisions. Out of the LAPD’s 1,284 claims, more than 800 were for traffic accidents, including failing to stop / yield, rear ends, or unsafe lane changes. For the Bureau of Sanitation, more than 93% of the payouts were for traffic collision claims.

Go deeper: Check out the controller's data here.