Los Angeles Mayoral Race: Inheriting a $1 Billion Deficit

The next Los Angeles mayor will inherit a city where quality of life metrics have worsened under current leadership. Residents face a backdrop of deteriorating roads, surging utility bills, and a housing market that remains out of reach for many. The incoming official must navigate these challenges while managing a fiscal crisis and preparing for the 2028 Olympic Games.

A recent poll by the UC Berkeley Institute of Governmental Studies found that reducing homeless encampments is the top priority for likely voters. Public safety and affordable housing followed, with protecting immigrant communities and balancing the city budget ranking lower. Tom Hogen-Esch, a political science professor at Cal State Northridge, noted that expectations for the mayoral office often exceed the actual powers granted to the position in the city’s complex governmental structure.

Homelessness remains the most visible metric of the current administration’s performance. The Los Angeles Homeless Services Authority reported that the city’s homeless population rose from 41,980 in 2022 to more than 45,194 this year. Mayor Karen Bass launched the Inside Safe program, which spent over $391 million to clear encampments. While the program moved about 6,500 people into interim housing, 42% of participants have returned to homelessness. The city budgeted approximately $4 billion for homelessness over the last four years but underspent by at least $473 million in the 2025-26 fiscal year due to staffing shortages and approval delays.

Housing affordability presents a parallel challenge. Nearly 60% of renters in Los Angeles are cost-burdened. Bass implemented Executive Directive One to speed up the review of affordable housing projects. However, only 7,728 of the more than 47,000 units in the pipeline are currently under construction. Christian Grose, a professor at USC, observed that voters are divided between the need for more housing and opposition to new development in their neighborhoods. This division complicates the passage of state legislation like SB 79, which aims to accelerate development near transportation hubs.

Infrastructure decay has drawn criticism from within City Hall. Rick Cole, the former Chief Deputy City Controller, described the city as ungovernable due to bureaucratic dispersion. More than 5,000 sidewalk repair requests are pending, and tens of thousands of streetlights remain broken. The city stopped repaving streets for eight months last year due to staffing issues related to federal accessibility requirements. Fernando Guerra, a professor at Loyola Marymount University, questioned how a government with a $14.8 billion budget and over 5,500 public works employees falls so far behind on basic maintenance.

The city’s financial stability has weakened significantly. The City Council and mayor declared a fiscal state of emergency last year in response to a $1 billion deficit. Revenue shortfalls and increased liabilities from the Palisades fire contributed to the shortfall. Rating agencies S&P and Kroll downgraded the city to a negative outlook. The budget has grown by about 25% over the last four years, driven in part by pay increases for city employees and record liability settlements for police excessive force claims.

Police reform remains a contentious issue. Bass announced a 47% drop in homicides since taking office. However, challenger Nithya Raman has vowed to replace LAPD Chief Jim McDonnell, citing a loss of public confidence on immigration issues. Raman, who has voted against recent pay raises for police officers, plans to audit the department to ensure alignment with sanctuary city policies. Bass has supported McDonnell, arguing that removing the chief before the 2028 Olympics would disrupt the department’s efforts to stem officer attrition.

The new mayor will also contend with voter skepticism. Hogen-Esch noted the absence of campaign signs in his El Sereno neighborhood, a sign of political fatigue not seen in 25 years. Jim Newton, editor of UCLA Blueprint magazine, stated that residents want encampments removed without punishing poverty, though he acknowledged the uncertainty of achieving that goal. The incoming leader must balance limited administrative power with the high expectations of a populace frustrated by slow progress on long-standing problems.