Los Angeles herald., 1910-01-04
NEW COUNCIL
FINDS MONEY
IN TREASURY
FINANCES OF CITY IN GOOD
CONDITION
MUCH CREDIT is GIVEN TO A. j..
WALLACE
Chairman of Committee That Handled
Cash Tells How Los Angeles
Came to Have Bal
ance on Hand

ipaltty for the rest or the nSCal
year. and until next years taxes are
available, the new city council comes
into office in better shape than any
previous council. Never before has the
city treasury shown such an abundant
amount Of cash on hand for a new
council to handle, and candid members
of the council and other city officials
give the chief credit for this state of
affairs to A. j. Wallace, chairman of
the finance committee, who has done
wonders with the resources of the city.
Only the finance committee and the
city auditor even knew of the exist
ence of this reserve fund, for it was
known that If some members of the
council had an idea there was any
money in the treasury the balance
would not be as large.
Councilman Wallace and Auditor
Mushet both had reports to submit on
this matter, and both reports were
submitted with some pride. In his re-
port Mr.. Wallace reviewed the situa-
ton as the council had found it when
it went into office. He said, in part:
Finance Committee Report
"Previous to the election of this
council in 1906, the public press and the
civic bodies of Los Angeles had from
time to time indulged in criticism OF
the financial methods of the city. Some
of them contended that the city S
necessary permanent improvements,
such as bridges and fire engine houses,
should be paid out of the tax fund IN
stead of out of bond money, as was
usual. Others found fault with the
deplorable condition in which the city
found itself at the opening of each
fiscal year, when it was unable to meet
its current expense bills for a period
of several months until the tax col
lections Of November were made.
1.-THE fiscal year of this city and the
calendar wear do not coincide. The
term of councilman harmonizes with
the calendar year, but it begins and
it ends in the middle of the fiscal year
''This is not the end of a city year
but it is the end of this councils ad-
ministration, and therefore a resume
of financial condition is desirable.
When the present council had been in
office six months, and had reached the
end of the fiscal year that its predeces-
sors had begun, it was faced with the
following facts: There were several
continuing contracts ealing for large
payments, such as frehouse, lot and
incinerator purchases. Additional to
these and much more serious. was the
condition of the outfall sewer fund.
bond moneys voted for its construction
were exhausted. The old sewer by its
repeated breaks was a source of dam
age and a constant menace, and more
than half the city was entirely without
sewer connection.
I'VE decided that s500OOO was needed
for that purpose, but with the out
fall sewer depicting the treasury that
amount could not come out of the first
years revenues without crippling the
city's business. So the aim was to lay
up $25O0O during the first year. This
was accomplished and from June to
November of 1908 all wages and sal
aries were regularly paid, but contract
payments and merchandise bills had
to be postponed till the new taxes came
into the treasury.
Tax Brought Relief
This s250,O00 was in effect a loan
from a reserve fund and was divided
amongst the various departments on
July / to meet their necessities until
the November tax payments brought
relief, at which time it was returned
to the reserve fund. Then between
that June of 1908 and the following
June of 1909 a further sum of $250,000
was saved and added to this reserve,
making a total of $780, 900. This half
million dollars, with the current in
come from licenses, ETC., enabled us
to pay all bills during the four finan-
cially dry months that ended sixty
days ago on November /.
THE amounts expended for material
and permanent improvements during
the three years of this administration
deserve consideration. The chief items
are bridges, real estate acquired for
future public buildings and fire houses
with equipments. For these purposes
this council has made an average ex-
penditure Of about $500,O00 each year.
This has been done out of regular tax
funds and without the use of any bond
money. The charter allows a levy Of
one dollar and our council made it
IS cents. This grew out of the trans
fer this year from the city to the coun-
ty of all responsibility for school funds.
This relieved the city of IS cents on
the one dollar but added that much
TO the county and so brought no relief
to the taxpayer. 1t simply means that
an S5-cent rate now is as heavy for
the taxpayer as a 100-cent rate was
in previous years, and you will agree
with me that hereafter the 85-cent levy
should be as strictly adhered to as the
100-cent levy formerly was
This report shows that our sue
cessors in office begin their public
business 100000 better off than we
were three years ago, but it by no
means follows that we have done any
thing remarkable, unless it be remark
able in the transaction of public af-
fairs to use ordinary business pru-
dence.
ITO this city congratulation that it's
funds are in as good condition as here
indicated is rendered To you nine men
who in half an hour begin your term
as councilmen OF Los Angeles, con-
graduation that enough of the tax
payers money is turned over to you
to enable you to maintain the city's
credit until November, 1910"
In his report the auditor said:
Auditor Makes Report
II deem it opportune and proper that
should, as the citys fiscal agent.
make a plain statement concerning
financial matters to you at the close OF
your administration, and through you
to the taxpayers.
AS you are aware, the charter Of the
city of Los Angeles states that the
amount of tax that can be levied for
any one year for all municipal purposes
shall not exceed 81 on each $10O worth