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Up to 209 layoffs, salary freeze possible for City of LA (updated)

Mayor Antonio Villaraigosa is calling on the Los Angeles City Council to make budget cuts, including 209 layoffs starting Jan. 1, 2013.
Mayor Antonio Villaraigosa is calling on the Los Angeles City Council to make budget cuts, including 209 layoffs starting Jan. 1, 2013.
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When the Los Angeles City Council approved its budget for fiscal year 2012-13, members kicked the can down the road of layoffs. Now, nearly halfway through the year, those 209 layoffs are back. 

L.A. Mayor Antonio Villaraigosa called for the layoffs in a letter sent in anticipation of the financial status report from the city administrative officer. The layoffs are expected on Jan. 1, 2013. 

“This is a difficult yet necessary decision,” Villaraigosa said.

Of those 209 positions that are listed on the city’s books, 186 are filled by employees, according to City Administrative Officer Miguel Santana, who is also recommending that 50 jobs be cut from the City Attorney’s Office. That would end furloughs for the department. 

Even with those layoffs, the city’s budget deficit for 2013-14 would be $216 million. Without the layoffs, the shortfall would increase to $232 million. Just four months into this fiscal year, the city has a $16.6 million deficit.

“The actions taken have not come easy and future austerity is necessary. Every decision the city makes will be examined and analyzed in the context of the city’s overall fiscal health and sustainability,” Santana wrote in his report.

“Rating agencies for one are appraising the financial strength of California cities based on their assessment that more municipal bankruptcies and bond defaults will occur in the future.”

In his memo, the mayor also called for the final approval of a pension plan that would roll back benefits for employees hired on or after July 1, 2013.

Under the new pension tier, the retirement age would increase to 65 and cost-of-living adjustments would be capped. Retirement benefits would also be based on 75 percent of an employee’s final compensation, and health benefits for dependents would be eliminated. 

The L.A. City Council’s final vote on the plan is expected on Friday, and labor leaders have pledged to fight the plan in court. 

When it comes to current employees, the mayor wants to freeze salary increases.

The city is also moving ahead with plans to privatize the Convention Center and Los Angeles Zoo. A discussion on the management of the Convention Center is scheduled for tomorrow’s city council meeting. Meanwhile, the future of the zoo remains uncertain. Last month, the Greater Los Angeles Zoo Association pulled the plug on talks to take over management of the asset. 

“The challenges ahead also require us to review all our programs and expenditures,” Villaraigosa said. “Even the most ‘sacred cows’ must be evaluated and considered for reduction or elimination based upon a prioritization of service delivery needs.”  

Other budget recommendations from the mayor include:

Councilman Paul Krekorian, chair of the Budget and Finance Committee, called the mayor’s memo “sobering.”

“Inevitably, all of these solutions will be unpopular with someone, and some may be unpopular with just about everyone,” Krekorian said. “But the mission before us as a city is not just to do what is popular, it is to build a strong foundation for a brighter future for Los Angeles.” 

This post has been updated.