LA faces a nearly $1 billion budget shortfall. ABC7 took a deep dive into the financial mess

LOS ANGELES (KABC) — Los Angeles Mayor Karen Bass says city finances are so tight right now, she is proposing laying off more than 1,600 city workers to balance the budget.

So how did the city of L.A. get into such a financial mess that it’s facing a nearly $1 billion deficit?

One reason is because more and more of taxpayer money is being used to pay out civil lawsuits against the city.

According to data from the L.A. Controller’s Office, in fiscal year 2022 the city paid out just over $91 million from lawsuits against the city. The next year that number jumped up to $166 million.

In fiscal year 2024, it ballooned to $247 million.

“That keeps taking away because we can’t just generate money like the federal government,” L.A. City Controller Kenneth Mejia told Eyewitness News. “We rely on every dollar. So if we spend half a billion dollars on lawsuits in literally two years, that money is going to take away from the city to spend on other basic city services and keep people employed.”

The controller isn’t kidding about the city paying out about half a billion dollars in civil payouts in just two years.

Eyewitness News’ investigative team took all the civil payout data and isolated what the city had to dish out from the start of 2023 through 2024. It comes out to $546 million dollars.

About half of that came from lawsuits against the Los Angeles Police Department, which dished out $222 million in lawsuits. Nearly 50% of the money that the LAPD paid out in lawsuits had to do with allegations of excessive use of force, according to data from the controller’s office.

That’s followed by Public Works Bureau of Street Services at $74.8 million, which includes suits for poor roads damaging cars.

The Bureau of Sanitation has had to pay out $74.3 million.

Eyewitness News asked LAPD what, if anything, it is doing to try to reduce the risk of these lawsuits and is still waiting for a response.