LA Times: The saga of Maywood's downward spiral

By Sam Quinones, Los Angeles Times

November 27, 2010

This summer, the small city of Maywood made national headlines when it laid off most of its workers, disbanded the Police Department and contracted most city services to the neighboring city of Bell.

Maywood's move was quickly overshadowed by the salary scandal in Bell, which resulted in the indictments of eight current and former city officials on charges of public corruption. Now Maywood is working to extricate itself from Bell and rebuild its own city government.

But an examination into how Maywood found itself in this position offers a window into the struggles of this group of small, largely working-class communities that straddle the 710 Freeway southeast of downtown L.A.

Maywood's problems have their roots in an effort seven years ago to provide police services to another neighboring city, Cudahy.

The cities agreed upon a fee of $261 per officer hour, enough to cover Maywood's costs.

But in the ensuing years, rising costs of policing Cudahy quietly drained Maywood of more money every year.

By 2009, its $5-million reserves were gone and the budget was in deficit. A city consultant discovered that the contract was actually losing Maywood $1.1 million a year.

Maywood's insurer, and its city staff, urged the council to sign a more lucrative contract with Cudahy that would have rebuilt its reserves. But the council delayed. Members wanted to study forming a regional police force with Bell and other cities.

Instead, Maywood lost its insurance, forcing the city to hand over the reins to Bell.

"It's an incredible story if you think of a community with a small budget throwing away" money like that, said Paul Philips, Maywood's interim city manager in 2009 who noticed the contract's problems and left when the City Council ignored his warnings.

Today, Maywood struggles to remain a city at all.

Interim city officials don't have a clear idea how much the city has in reserve, though they say it's sure to be minuscule.

"It's a scary place we're in right now," said Gerardo Mayagoitia, a 34-year resident of Maywood, at a recent City Council meeting.

The saga — which started with that one ill-conceived police contract in 2003 — has led to questions about the economic viability of some southeastern Los Angeles County cities, where the tax base has withered along with the manufacturing that once supported the towns' incorporation. Formerly home to Bethlehem Steel, Maywood now counts an Arco AM PM, King Taco and a McDonald's among its largest sales-tax generators.

But the Maywood police contract story suggests these cities' viability is threatened more by a dysfunctional political culture that undermines their economic progress.

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Posted by Steve Sinai