Los Angeles Mayor Antonio Villaraigosa released a proposed $7.05 billion city budget Monday, April 20th, which he says relies on city employees to make certain financial sacrifices to avoid thousands of layoffs and help close a $530 million shortfall.
Addressing the impact of the nation’s current recession on Los Angeles, Villaraigosa said rising unemployment, the housing market crash and the credit crisis
have caused city revenues to decline in nearly every category.
The total proposed budget has decreased one percent from last year’s adopted budget. Villaraigosa said the $530 million deficit will be closed through a combination of spending reductions, private investment and efficiencies, including some departmental consolidations.
But the mayor said other cost saving actions are needed to avoid as many as 2,800 potential layoffs, which would hit nearly every city department and result in a dramatic reduction in city services.
The mayor proposed to maintain police buildup and gang reduction efforts but he called on unions representing city employees to take part in “shared responsibility and sacrifice” to help prevent the drastic number of layoffs.
“During these extraordinary times, it is the responsibility of all
city leaders to recognize that reform is no longer a luxury; it is a necessity,” Villaraigosa said. “The need for shared sacrifice
is not just rhetoric; it is a reality.”
The mayor proposed a variety of options to be considered by
the City Council, city employees and union leadership, which would prevent the need for layoffs and maintain a high level of city services by reducing the cost of the existing city workforce by more than ten percent. He said he asked the Personnel Department to prepare for approximately 400 layoffs.
Among the options for workers, including himself, are unpaid holidays, and reforms to mileage reimbursement, healthcare coverage and overtime. The mayor said the plan would start with him, noting that he would cut his own salary by 12 percent, freeze his staff’s wages and reduce his office budget by ten percent.
Villaraigosa has begun a series of meetings throughout the
city to discuss the budget and how to keep Los Angeles working and he will also hold meetings with city employees in the coming weeks.
The City Council will begin deliberations on the mayor’s proposal in early May. The final budget must be adopted by June 12th.