The Los Angeles City Council has granted preliminary approval to an ordinance that would merge three separate city departments into a single entity. In a 12-3 vote, council members approved the draft to consolidate the departments of youth, aging, and economic development.
The responsibilities of these three areas will be managed by the newly rebranded Community Investment Department. This move comes despite expressed concerns that the consolidation could hinder the city’s objectives regarding economic development and youth support.
Budget Pressures and Strategic Alignment
Mayor Karen Bass first proposed the consolidation last year as part of the budget for fiscal year 2025-26. The revised budget was designed to address a deficit of nearly $1 billion.
According to the mayor’s office, this deficit was driven by a decrease in tax revenue, overspending, an increase in liability payouts, and the wildfires of January 2025. The administration stated that current programs were “not strategically aligned” and could be improved under one entity.
As part of the transition, Mayor Bass fired Jaime Pacheco-Orozco and Carolyn Hull in September 2025. They served as the general managers of the Department of Aging and the Department of Economic and Workforce Development, respectively.
Opposition and Economic Concerns
Council members Monica Rodriguez, Traci Park, and Nithya Raman opposed the ordinance. Councilwoman Rodriguez has been a vocal critic, arguing that Los Angeles should not fold its economic workforce development into a larger bureaucracy.
“At a moment when cities across the country are aggressively competing for investment, employers, tourism and economic opportunity, LA should not be weakening the very department responsible for advocating on behalf of economic development,” Rodriguez said.
Rodriguez highlighted that the local business community is facing significant challenges. She noted that stores and restaurants are struggling or closing due to public safety concerns, inflation, rising costs, and permitting delays.
She further argued that the mission of job creation and business retention “deserves its own voice and its own leadership.” Rodriguez also expressed strong criticism regarding the elimination of the department focused on youth development.
The Path Forward
Mayor Bass and other city officials continue to defend the plan, asserting that services can be delivered more cost-effectively. They argue that operational sustainability and service levels could be at greater risk if economic development remained in a smaller, standalone department.
The City Council is scheduled to hold a second and final vote on the proposed ordinance next Tuesday. If passed, the transition to the Community Investment Department may begin.
Frequently Asked Questions
Which departments are being consolidated?
The departments of youth, aging, and economic development are being merged into the Community Investment Department.
What caused the city’s budget deficit?
The nearly $1 billion deficit was caused by a decrease in tax revenue, overspending, an increase in liability payouts, and the January 2025 wildfires.
Who opposed the preliminary vote?
Council members Monica Rodriguez, Traci Park, and Nithya Raman voted against the measure.
Do you believe consolidating city departments is an effective way to handle budget deficits, or does it risk reducing the quality of specialized services?