Los Angeles facing a $7.7 billion financial hole

A new analysis by Truth in Accounting, a non-profit government finance watchdog group, found Los Angeles needs $7.7 billion to pay its bills—a burden that equates to $6,000 for each city taxpayer.

At the end of the 2017 fiscal year, Los Angeles had more than $20 billion in bills and $12.7 billion in available assets to pay those bills after capital and restricted assets were excluded. The result is a $7.7 billion shortfall and a $6,000 Taxpayer Burden™, which represents each taxpayer's share of city’s unfunded debt after its available assets have been tapped. TIA's Taxpayer Burden indicator incorporates both assets and liabilities, not just pension debt.

Los Angeles’ change from a Taxpayer Burden of $7,200 in 2016 to a Taxpayer Burden of $6,000 in 2017 is largely due to a decrease in unfunded pension liabilities thanks to strong investment returns for the city’s public retirement funds.

The bottom line: Los Angeles needs $7.7 billion to pay all of its bills, or $6,000 from each taxpayer in the city, which is why it received an "D" grade for its fiscal health.

You can find the full report here.