By Jose Navarro, MBA | The Navarro Report
Los Angeles County contains 88 incorporated cities. They share a county government, a geography, and in most years, a general economic climate. What they do not share is a fiscal trajectory. The budget season playing out right now across those 88 cities reveals a range of governance outcomes that county-wide statistics routinely obscure — and that range has direct consequences for the roughly 7 million people who live in incorporated cities rather than the unincorporated county.
Consider four cities at this moment, all within the same county, all operating under the same state law and the same federal funding environment:
Long Beach just adopted a budget with a $58.2 million structural deficit, closed by eliminating 483 positions, raising fines, and cutting library hours. The deficit accumulated because five years of maintaining service levels without structural adjustment coincided with a simultaneous drop in multiple revenue streams and the loss of federal funding that had become embedded in the operating budget. The people bearing the cost are the 263 currently-employed city workers losing jobs and the residents losing park programming and library days.
Culver City projected a $26.5 million deficit and produced a balanced budget with no layoffs and new programs. The mechanism by which a $26.5 million gap was closed while spending was added has not been transparently explained in terms a resident can evaluate independently. Whether this represents genuine management innovation or accounting flexibility that defers the problem will become apparent in next year’s projections.
Compton remains on the California State Auditor’s high-risk list. This is not a new designation — it dates to 2022 and survived a formal review process in 2025 that cleared two similarly situated cities. Items still outstanding include a sewer settlement from 2016 and a funded plan for street conditions. The roughly 100,000 residents of Compton live with the infrastructure backlog those outstanding items represent.
Inglewood is navigating a court ruling that its development agreement with a billionaire NFL owner is void, a DA investigation into an unbudgeted $20 million payment to that owner’s development company, and a $24 million budget deficit that predates the legal fight. The city’s residents were told no public money would go toward the stadium. They are now watching a legal proceeding that will determine how much public money the city owes in its aftermath.
These are not four outliers. They are four illustrations of something the county’s aggregate economic data does not capture: the quality of fiscal governance varies enormously between cities that share the same county, and the residents with the least political capital tend to live in the cities where that governance is weakest. Compton’s high-risk designation and Long Beach’s structural deficit do not fall evenly across the county’s income distribution.
The county has 88 cities because California law allows communities to incorporate and govern themselves. That autonomy is real and valuable. It also means that the financial competence or incompetence of a given city council and city manager has direct, durable consequences for residents who may not have the resources to move to a better-managed neighboring city when their city’s finances deteriorate.
County averages are not the story. The 88 individual fiscal pictures are.
Jose E. Navarro, MBA, is a financial controller and founder of The Navarro Report, a public finance and government accountability publication based in San Diego, California.
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