After months on the precipice of elimination due to budget woes, the city agency that oversees neighborhood councils has received a last minute reprieve.

A deal to keep the Department of Neighborhood Empowerment (DONE) independent was crafted by City Councilman Paul Krekorian during a June 15th meeting of the council’s education and neighborhoods committee in a move cheered by proponents of the local councils.

“There was simply no consensus across the neighborhood council system favoring consolidation,” said Sharon Commins, the first vice president of the Mar Vista Community Council. “Potential cost savings to the city did not appear to be substantial enough to warrant folding DONE into another department.”

Mayor Antonio Villaraigosa proposed combining DONE with the Community Development Department in February in an effort to save the city money as it continues to look at a variety of ways to reduce its looming $480 million shortfall over the next two years.

That proposal was assailed by neighborhood leaders, who accused the mayor of a lack of vision regarding the importance of the local councils.

Krekorian, who has an active neighborhood council in his district, indicated his feelings regarding the local boards when he proposed a six-month stay for the embattled city agency.

“At a time when we’re cutting back on so many services, the neighborhood council movement is especially important,” Krekorian said. “It needs to be especially vibrant.”

Denny Schneider, a member of the Neighborhood Council of Westchester-Playa, said Villaraigosa’s plan to merge DONE with another agency would have been a detriment to local councils and their ability to function properly.

“(Villaraigosa’s recommendation) was totally against the principles of DONE and would have limited its access to the city’s upper management,” he said.

The neighborhood council system was created via the city charter in 1999 and was approved through a city ordinance two years later. There are now 90 local advisory boards that have become very influential in many communities, and over the last two years, City Hall officials have witnessed their representatives flex their political and organizational muscles on planning and budgetary matters.

DONE General Manager BongHwan Kim thinks the intense lobbying efforts by neighborhood council leaders played a crucial role in his agency’s resurrection.

“A number of neighborhood councils came to City Hall and expressed very strong support (for DONE),” he told the Argonaut.

Venice Neighborhood Council Vice President Carolyn Rios said it was essential to the continued growth of neighborhood councils that DONE not be merged with another agency that does not understand the mission of the local advisory boards.

“We want very much to keep working with DONE, a city department that is devoted to facilitating our needs,” Rios said. “It’s better to have a department where its mission is to work with the neighborhood councils instead of a (city agency’s) that isn’t.”

In an interview earlier this year, Kim made a similar point.

“If we are merged with another city agency, the responsibility will then fall on the (elected) councilmembers’ staffs instead of the neighborhood councils,” DONE’s general manager said. “And other departments don’t really understand neighborhood councils and how they work.”

The beleaguered city department has had its share of controversy on the road to resurrection. Earlier this year, at Kim’s request, City Controller Wendy Greuel conducted an audit of the city agency, which unearthed a host of concerns.

“At the request of DONE, my office recently conducted an audit which examined how the department oversees neighborhood council expenditures,” Greuel wrote in her audit report in January. “The findings showed that, while engagement and activism have grown, there has been a systematic failure of accounting and fiscal oversight of the neighborhood councils by DONE.”

Five members of neighborhood councils have been indicted for alleged financial transgressions.

“The department does not have the proper personnel in place to provide the fiscal oversight that could help prevent the waste of taxpayer funds detailed in the audit,” Greuel wrote in her audit.

Kim, whose agency has lost more than half of its staff to budget cuts, said he requested the audit because he wants to be as transparent as possible.

“I thought that it was the best thing to do,” said DONE’s general manager. “We need the city departments and neighborhood councils to help us fix our problems.”

One area where Kim would like to improve is the number of councils in compliance with ethics training, which is mandatory for all neighborhood councils. “Our commission is going to be discussing consequences for not taking ethics training,” he said. “One idea is to withhold those who have not taken the training from voting.”

DONE will be reevaluated it the end of the year to see if any improvements have been made.

Commins feels that it is inevitable that the city agency must undergo a revamping in order to remain viable.

“DONE has lost so many positions that some restructuring is inevitable,” she said. “DONE will need volunteer help, and I think neighborhood councils are willing to step up where volunteer help might be appropriate.”

In addition to DONE winning a six moth reprieve, the City Council will keep the $45,000 budgets of neighborhood councils intact, but they will lose all of their rollover funds from the last fiscal year, due to the multi-million dollar municipal deficit, Kim said.

Rollover funds are savings from city- allocated neighborhood council budgets that some local boards have stockpiled.

Regardless of the size of its staff, Schneider says DONE is an important cog in the city government’s machinery.

“We need a strong DONE,” he said.

Kim reiterated the significance of neighborhood leaders and how the continuing influence of local councils was crucial in his department winning a second chance to function independently.

“It is a testament to the neighborhood council support by city leaders that the education and neighborhood committee decided to give our department our independence for at least another six months,” Kim said.