INGLEWOOD – Inglewood can’t say they weren’t warned about the financial pressures they are under due to unfunded pension liabilities and other post-employment benefits.
The June 17 city council agenda brings the City’s financial pressures into focus after the City Council continues to refinance its Pension Obligation Bonds and instead of paying down the debt, they dump the proceeds into the General Fund Reserves and declare the City “fiscally solvent” by adopting “balanced budgets” while simultaneously giving out generous raises the City honestly can’t afford.
The bond refinancing also appears to coincide with Inglewood Mayor James T. Butts Jr. reelections, as cited by the Daily Breeze.
City Hall even boasted about Inglewood’s newfound fiscal strength in a press release and Mayor James Butts pointed to the surplus resulting from the bond money as evidence of his successful leadership during his reelection campaign in 2018.
How Inglewood sidestepped voters when it took on millions in debt to cover up a deficit, then gave raises for executives
According to the June 17 staff report, “The increased need to fund the requirement of CalPERS as well as the increasing number of retirees receiving health and other benefits is putting fiscal pressure on the City. As the retiree population grows, the cost of retiree benefit costs also grows proportionately. With a pay-as-yougo basis, there are no assets to offset liabilities that accumulate over the working lifetime of employees. As a result, agencies face rising unfunded pension liability (“UAL”) and retiree medical costs. A Section 115 Trust is a prudent approach to funding future expenses and protecting the City’s assets.”
According to the 2022-2023 Inglewood Basic Financial Statements the City has an unfunded pension liability of $233 million and Other Post-Employment Benefits (OPEB) liability of $123.2 million.
This debt financing scheme has finally come back to haunt them as the City continues to use bond proceeds to present “balanced budgets” to the public.
- Inglewood uses bond proceeds to balance City’s budget
- Opinion: Inglewood’s generous use of pension debt bonds distorts city’s finances
- Inglewood’s financial liabilities continues to grow under Butts’ administration
- Inglewood City Council lied to the public about the City’s fiscal condition
In January 2020, the OC Register published an article titled “Why these 4 Southern California cities were called out for debt management troubles” citing a study by then state Sen. John Moorlach, R-Costa Mesa, who predicted the Orange County bankruptcy, called Inglewood “the fifth worst city in the state per capita with more than 50,000 population.”
“Moorlach believes one of the best indicators of budgetary health is a city’s unrestricted net assets, defined as funds that are free of any encumbrances after bills have been paid.
Some cities, such as Inglewood, no longer have unrestricted net assets and, in fact, have dug themselves into a deep hole instead. They now have unrestricted net deficits, usually attributed to pension benefits and retiree medical care.
In June 2018, Inglewood — with a population of roughly 110,000 — had an unrestricted net deficit of $388.7 million, amounting to $3,423 in debt for every person who calls the city home.
That debt has continued to climb every time the City Council votes to refinance the POB (without voter approval) and then pocket the proceeds.
- How Inglewood sidestepped voters when it took on millions in debt to cover up a deficit, then gave raises for executives (Daily Breeze 2019)
After the Daily Breeze article became public, former longtime Inglewood treasurer Dr. Wanda Brown began speaking out against the City’s financial position and was silenced and faced fiscal sanctions from her council colleagues.
Dr. Brown has continuously said that the City’s budgets are working documents and that the REAL condition of the City can be found in its Comprehensive Annual Financial Report (CAFR).
Dr. Brown went so far as to start providing this author with regular commentary on the City’s financial position and in 2021, Dr. Brown spoke in depth with 2 Urban Girls about the City’s financial condition.
“The budget is not the best place to look at the city’s financial standing, you have to look at the Comprehensive Annual Finance Report (CAFR) because that is where the truth is,” said Brown. “Betty Yee, Sen. John Moorlach, and myself can’t all be wrong about the financials.”
“The city is in far worse shape than it was when the City declared a fiscal emergency shortly after Dorn was removed from the council,” said Brown.
Under Mayor Butts, the City declared a fiscal emergency in 2021 to raise taxes to pay for the Inglewood Transit Connector project.
“In 2011 the City had approx. $568 million in assets, and only $475 million in 2020,” explained Brown. “In 2011 our liabilities totaled approx. $354 million, and in 2020 they have nearly doubled to $681 million.”
When asked what contributed to the debt, Brown was frank.
“Overspending!” said Brown. “When the city refinanced the pension obligation bonds, instead of paying down the debt, they put the money into the general fund as if it were revenue.”
“In 2011 the City’s unrestricted fund deficit was approx. $74 million, in 2020 it has swelled to $504 million,” said Brown. “Inglewood has a Finance Department that lacks the education and experience needed to run it. [David] Esparza was misspending money at the LA Housing Authority, and when [Jeff] Muir interviewed Sharon Koike-Pitpit for a position, he found her unqualified. These are the City’s Finance and Assistant Finance Director’s.”
She went on to say that because of the mayor’s control of the members of the council, spending would continue to be an issue.
“Mayor Butts having total control of the council, means he has the City by the throat with two hands,” said Brown. “I tried to tell the council internally, but had no choice but to go public, and as a result I was retaliated against by having my access to City Hall restricted, I was removed from the council dais, had my duties taken away, and my salary significantly reduced.”
During the City’s mid-year budget presentation last month, the budget department provided a snapshot of spending between Oct. 1, 2024 through April 30, 2025, that showed spending continues to be high.
Dr. Brown, was the elected treasurer of the City for 32 years.
She earned her Bachelor of Science Degree from Cal-State University Long Beach, MBA from UCLA, and post graduate studies at UCLA. Each of her degrees has an accounting emphasis.
She is a California Certified Municipal Treasurer, Certified Finance Municipal Administrator, and Certified Cash Handler via the Association of Public Treasurer of the United States and Canada. Additionally, she is a licensed Real Estate Broker, Life & Disability Agent, and is a Registered Representative, licensed to sell mutual funds investments and variable contracts.
Dr. Brown was publicly embarrassed by the City Council after she began to reveal the true condition of the City’s financial position which has now been corroborated by City Manager Luis Atwell. Dr. Brown filed a lawsuit against the City for retaliation as a whistleblower and awaits a California Supreme Court ruling on her appeal sometime this year.
In the meantime, the City has resorted to outsourcing its investments due to Dr. Brown’s departure.
Mayor Butts, Councilman Alex Padilla and Councilwoman Gloria Gray are up for reelection in 2026.
