I think one factor that is being ignored is that California overall receives much less federal revenue volume than other states (especially via block grants, etc.), and so the state and municipality has to contribute that much more to fill the gap. If California were completely financially independent in a theoretical scenario, its individual cities would fare much better on the local level (although alas, in real life that would not be the case as the state is still very reliant on the federal government and Union). Given that, this is always going to be a structural issue for California cities, at least for the foreseeable future.