Los Angeles: Epic Levels of Waste, Fraud and Abuse of Gas Tax Funds Exposed in Caltrans and Local Transportation Agencies

Los Angeles: Epic Levels of Waste, Fraud and Abuse of Gas Tax Funds Exposed in Caltrans and Local Transportation Agencies

New Los Angeles transit buses that cost five times more than clean natural gas buses – and break down! LADPW has more members of the $100,000 Club than crews assigned to fill potholes!  At LA Metro, over 655 bus drivers make more than $100,000 in compensation each year! That’s just the tip of the waste iceberg!

With the election just weeks away, the Yes on Prop 6 Gas Tax Repeal Campaign today released government documents and records showing numerous examples of “epic levels” of waste, fraud and abuse of gas tax funds and other taxpayer resources at Caltrans and Los Angeles local transportation agencies.

The records and documents were obtained through the California Public Records Act (CPRA) process – and cover only materials received back from LAMTA, LADPW, and Caltrans. Other local government agencies also receive and spend gas tax funds – raising the question of how many more examples of waste of gas tax funds exist in the Los Angeles region.

“These examples of outrageous waste of the gas tax and other taxpayer resources provide the best reason to vote YES on Prop 6 the Gas Tax Repeal Initiative,” said Carl DeMaio, chairman of the campaign.

“Our existing gas tax funds are being wasted and we demand that these revelations of bloated bureaucracies, excessive salaries and compensation, and outrageous expenditures be immediately reformed before we give these people any more of our taxpayer dollars,” noted DeMaio.

Finding 1: The $100,000 Club – Government Employees Earning 6-Figure Salaries from Gas Tax

In just the two agencies selected for this review, an astonishing percentage of individuals are earning over $100,000 a year in compensation – at a time when the per capita median income in Los Angeles County stands at just $27,071. While it certainly is expected that some executive-level employees would earn six-figures, the astonishingly high percentage of total employees in the $100,000 Club is excessive.

  • Los Angeles Department of Public Works: More than one-out-of-three employees at LADPW earns $100,000 or more per year – with 1941 LADPW employees pulling in $100,000 or more. LADPW has more members of the $100,000 Club than crews assigned to fill potholes!
  • Los Angeles Metropolitan Transit Authority: More than forty-two percent of employees at LAMTA earns $100,000 or more per year – with 4476 LA Metro employees pulling in $100,000 or more. LA Metro has more members of the $100,000 Club than actual buses in its fleet!  LA Metro CEO Phillip Washington is pulling in a cool $425,016 a year in compensation.
  • Caltrans: More than half (57%) of the Caltrans employees earns $100,000 or more per year – with 11,256 Caltrans employees pulling in $100,000 or more. For every “active” project at Caltrans, there are more than six members of the $100,000 Club! The average compensation at Caltrans is a whopping $113,554 a year.

Finding 2: Are You Kidding Me Club? Outrageous Compensation Well Above Local Labor Market

The politicians will try to argue that the $100,000 Club is arbitrary and the reason why so many government employees are earning six-figures is because of the “special skills” they possess.  In a complete refutation to this spin, this review uncovered some shockingly high compensation packages for lower-skilled positions.

  • 6-Figure Bus Drivers:  At LA Metro, over 655 bus drivers make more than $100,000 in compensation each year including one, Jose Lara, who earns a whopping $174,308 in compensation each year.
  • Smile, You’re on Candid Camera: LADPW also employs a “Motion Picture and Television Manager” who earns $151,551 a year! That’s on top of her taxpayer-funded salary as an adjunct professor at LA City College.
  • The Platinum Plumber: Andrew Rella, a LA Metro plumber, is being paid $169,113 in compensation.
  • Tweet This! You think your kids are spending too much time on social media? Well, it could pay off if they get a job at LA Metro who pays their Director of Social Media $185,783 in compensation.
  • The Tree Doctors: Using public works and infrastructure funds, the City of Los Angeles has hired nearly 100“Tree Surgeons” – which we presume as simply landscapers – but several are paid close to what a real doctor would be paid:
    • Jeff Guiterrez (Tree Surgeon Supervisor 2) $196,688
    • Kurt Elliott (Tree Surgeon Supervisor 1) $173,181
    • Scott Harmon (Tree Surgeon Supervisor 2) $163,508
    • David Miranda (Tree Surgeon Supervisor 2) $163,465
  • Gold-Plated Trashmen: LADPW also oversees refuse collection services, paying 163  trash truck drivers earning $100,000 or more – with the highest being Willie Hunt who pulled in $140,504!

Finding 3: Los Angeles “Gold-Plated Buses” Plagued with Performance Problems

LA Metro has a champagne and caviar bus appetite – paying more than five times the expected cost per bus!  Instead of purchasing and running natural-gas powered clean buses at a cost of roughly $300,000 each, LA Metro has decided that political correctness demands they pay $1.65 million per bus for all-electric buses!

LAMTA purchased these all-electric buses despite numerous documented performance problems found by LAMTA staff when they initially did a pilot project with 5 of these all-electric buses. A LAMTA board report stated “The operating performance of these initial prototype buses did not meet Metro’s daily operational requirements – and after a full year of operation were removed from active service.”  The same LAMTA board report stated the buses had “limited range between charges and poor hill-climbing ability severely limits the lines on which they can be operated…the buses have also experienced low reliability.”  Despite all these red flags, LAMTA used a “non-competitive” contract process to purchase more of these costly, performance-plagued buses.  But hey, at least it is politically correct to be all-electric and the gas tax hike can cover the excessive cost!

Finding 4: Excessive Travel Purchases with Gas Tax Funds

  • Fly, Fly Away: $5000 trip to Paris, Munich, and Milan, $2700 for a trip to Las Vegas! And a jaunt to China totaling more than $5,000 taxpayer dollars

Finding 5: Bloated Bureaucracies

  • LAO Says Caltrans Over-staffed by at least 1000 positions in one program alone!
    • The Capital Outlay Support (COS) Program has over 10,319 positions, and the Legislative Analyst’s Office on September 17, 2018 reported “the program is overstaffed by more than 1000 positions!”
    • Despite this Caltrans has recently announced plans to hire more staff!
  • Engineering Failure: Caltrans has 7,494 “Engineers” – that’s more than three Engineers for every active project!

“These outrageous examples of waste of our gas tax funds is proof that voters cannot trust California government agencies with even a penny more of their money until efficiency and accountability reforms can clean up these excessive expenditures,” said Carl DeMaio, Chairman of Yes on Prop 6 Gas Tax Repeal Campaign. “Voters can send a strong message by voting YES on Prop 6 to repeal the costly and unfair gas and car tax hikes,” DeMaio concluded.