MOTION-- When the COViD-19 pandemic began, the city had to curtail congregate meals to the elderly
in neighborhood senior centers. To address this loss of life-saving nutrition services, the
city engaged a unique partnership with restaurants, taxicab companies and elder care
organizations to prepare and deliver hot meals to seniors in need. The innovative program
was a lifeline for seniors in need, and also for the local restaurant and taxi businesses that
were so devastated by the pandemic.
One of the taxicab operators that delivered these senior meals is still owed nearly $60,000
for services it rendered in this program. Both the Department ofAging and the Office of
Finance authorized the Controller to issue that payment, and a check was issued. However,
the check was sent to the wrong address and apparently was illegally cashed by someone to
whom it was not issued.
The city does not dispute that the amount is owed and does not dispute that the contractor
never received the payment to which it is entitled, and acknowledges that the check was
misdirected. Nonetheless, despite the error, the Controller has failed to reissue the
payment to the contractor for the work that it performed on behalf of the city,
The city’s bank is conducting an investigation to identify who stole the funds from the
original check and recover them. In the meantime, a city contractor that acted in good faith
and performed services at the city's request should not have to wait months to receive
payment because of the city’s own error in misdirecting the check.
Local businesses consistently express frustration with bureaucratic hurdles that make it
difficult to work with the city. Delays in payment by the city can be devastating, especially
for small businesses, when the contractor has paid out-of-pocket for its own costs in
performing services for the city. Such delays damage the city’s reputation as a business
partner and result in fewer local businesses being willing to accept city contracts, causing
less competition, higher costs to taxpayers, and less opportunity to create local jobs and
revenues through procurement.
I THEREFORE MOVE that the Council REQUEST that the City Controller immediately reissue
a check for the already approved outstanding invoice to LA City Cab, LLC for services that it
delivered to seniors during the pandemic.
I FURTHER MOVE that the Council INSTRUCT the Office of Finance and the Office of the City
Controller, in consultation with the City Attorney, to develop and adopt city policies
covering misdirected or misappropriated payments to ensure that the city makes timely
payments to vendors while still preserving all of its rights and working to recover lost
funds, and to report on those policies to the Council within 60 days.
I FURTHER MOVE that the Council instruct the Office of Finance and the Controller to
report to the Council within 60 days on steps that those offices can take to reduce the risk of such misdirected or misappropriated payments, and to reduce delays in payment to
vendors, including but not limited to increase paper checks.