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A breakaway city in the San Fernando Valley could support itself financially, according to a new report by the state agency overseeing the Los Angeles secession movement.

The report, released Friday, also concludes that, although Los Angeles would suffer some financial harm, it could be offset by annual payments made by the breakaway city.

The findings appear to boost supporters of the movement to break off Los Angeles’ sprawling residential section of more than 1 million people and create the nation’s sixth-largest city.

“It’s a great report for the valley and for Los Angeles,” said Jeff Brain, leader of the secession movement. “This is what we’ve all been working for. This report says it can happen.”

Mayor James Hahn said Friday that secession would harm the remaining neighborhoods despite a proposed annual mitigation payment of $55.8 million for 20 years to the city.