Local officials throughout L.A. County are putting out the word that higher fees or taxes could be in the offing, the result of increases in government pensions and health care costs.

The fees under consideration would hit a variety of businesses, including those with county health permits, commercial property owners in Los Angeles, L.A. apartment landlords planning condo conversions and water users in Santa Monica, to name a few.

In Los Angeles, a wholesale review of city fees is under way to determine if they are in line with rising service costs that will put pressure on Mayor Antonio Villaraigosa’s pledge to cut spending.

For the most part, the fee hikes being considered are relatively modest. But they add to what many consider an inhospitable business climate, especially in the city of Los Angeles. “Businesses are getting nickel-and-dimed,” said Larry Kosmont, an economic development consultant who publishes a survey on business costs in cities around the country.

Ironically, the fees and taxes come at a time when the booming real estate market is pumping up government coffers. Nonetheless, pension and health care costs are rising faster than revenues, causing local governments to either cut costs or to raise fees.

Over the next five years in Los Angeles, the cumulative deficits could top $900 million if no actions are taken, according to a report from Chief Administrative Officer Bill Fujioka. The shortfalls would start with $225 million in the 2006-07 fiscal year, beginning next July 1.

Fujioka said the city’s pension fund investments lost money several years ago after the drop in the stock market, forcing the city to dip into its general fund to maintain the system’s reserves. In addition, salaries continue to go up, as have health care costs, energy expenses and materials costs.

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The full story

is available in the July 4 issue of the Los Angeles Business Journal.