Thursday, July 9, 2009

Michael Jackson Memorial: Paying The Bill

There's one simple rule that is the basis of financial responsibility: Don't spend money that you don't have.

Critics are up in arms over the $1.4 million in expenses that were incurred by the city of Los Angeles as a result of Tuesday morning's Michael Jackson memorial held at the Staples Center.

But how are these expenses any different than any other event that is held at the downtown arena? Whether it be the Grammy Awards, a Los Angeles Lakers game, hockey or a concert?

When you're one of the biggest metropolitan centers in the world, you incur operating expenses. And when you are the entertainment capital of the world, it is not unrealistic for those expenses to include police details for a memorial service for the world's most widely-recognized and celebrated entertainer.

To be clear, according to the Los Angeles Police Department, $1.1 million of that $1.4 million figure was overtime pay for the 4,173 police officers that secured the Staples Center, Forest Lawn cemetery, and other areas that attracted fans and media.

Let's break that down, shall we? There were 4,173 law enforcement and public safety officials hired to work overtime by the city of Los Angeles, at a total cost of $1.1 million. That amounts to an average of $263.20 per employee. More specifically, it's $32.95/hour for an eight-hour shift. If overtime is time-and-a-half, that means the law enforcement officials were paid at a base rate of $21.97/hour.

And we're supposed to feel sorry for the city of Los Angeles because they don't have the financial where-with-all to pay them? You couldn't pay me $210.97/hour to do a police officer's job in some parts of this city - I definitely don't begrudge them a day of overtime to maintain security at the most media-saturated event of the internet age.

There's no point in arguing that $1.4 million is a small price to pay for the publicity the city received for a live event that went off without a hitch before one of - if not the - biggest worldwide audiences in history. And it's also pointless to dwell on the estimated $4.0 million in income for local businesses in the form of food sales, parking, shopping, hotels and transportation, as speculated by Jack Kyser, chief economist for the Los Angeles County Economic Development Corp.

If you had told the city of Los Angeles beforehand that they could pay $1.1 million to guarantee an incident-free memorial, or roll the dice with crowd control and take their chances, don't you think they would have gladly paid the $1.1 million?

Of course they would have... If they had it.

Need we be reminded that the reason they don't have the money, is because they are incapable of balancing a budget, there are moratoriums on spending, and the city is mired in a fiscal black hole where more than one-in-ten of its citizens are unemployed?

Which brings us back to my initial statement: If you can't afford to spend money you don't have, DON'T SPEND IT!

The memorial wasn't planned overnight, and someone, somewhere, should have talked to organizers about the costs inherent in the event. Had that been done, properly, solutions could have been explored in advance.

For instance: More than 1.6 million fans registered for the opportunity to receive a pair of the 17,500 free tickets to the memorial. Had the organizers charged a $1 processing fee for each request (which would have been easy to do - tickets were issued by Ticketmaster, and they know a thing or two about service charges) that total would have covered all of the city's expenses... With money to spare.

A nominal fee might have also prevented people from registering for tickets if they weren't serious about going... So maybe you charge a $3 registration fee - if that vetted two thirds of the applicants, it still would have netted $1.5 million and covered the city's costs for the event... With money to spare.

I don't know any Michael Jackson fans that wouldn't have paid $3 for an opportunity to attend his memorial service.

You might argue that it's easy to come up with solutions after the fact. That may be true. But that doesn't change the fact that somebody didn't do their job in preventing the problem.

Had I been presented the situation in the days before the memorial, I know that I would have offered that solution in a matter of minutes. How many other solutions were never explored?

It's not rocket science, it's just common sense.

Unfortunately, common sense seems pretty hard to come by when it comes to fiscal planning and spending in the state of California.

PS: If the city of Los Angeles wants to cry that they can't afford to pay the 4,173 law enforcement officers they hired to maintain order, they might want to make sure all 4,173 were necessary. Judging from the urgency of his stance, I'm guessing this guy wasn't texting for back-up...

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