LA City Council begins process of layoffs, furloughs

The Los Angeles City Council, facing a $400 million budget deficit, voted to begin the process of laying off up to a thousand city workers and instituting mandatory unpaid furloughs. Council leaders stressed it was only an “insurance policy” in case they were unable to reach an agreement on an early retirement plan for 2,400 workers. KPCC’s Frank Stoltze reports.

Frank Stoltze: That plan, as originally conceived in June, was supposed to have saved money. But L.A.’s chief administrative officer and chief legislative analyst issued a joint report Friday that said it would instead cost the cash-strapped city.

The city council, under pressure from politically powerful labor unions, has struggled to find enough money to make the early retirement plan work – and to avert layoffs and furloughs. Council President Eric Garcetti said the two sides have made progress after two days of negotiations.

Eric Garcetti: We are at least at the 50 yard line and that’s an amazing thing. I think we both acknowledge this is really hard work. If you ask "is this doable?" Yes. "Is this easy?" No.

Stoltze: Cheryl Parisi of the Coalition of City Labor Unions – that represents 22,000 city workers – said she was optimistic they’d come to an agreement that included early retirement and prevented layoffs and furloughs. But she also reiterated that unions would sue the city if they don’t, arguing the city agreed to the retirement plan in June.

Cheryl Parisi: Neither one of us are ceding our legal positions, if you will, with regard to the issues.

Stoltze: Even if the city council and organized labor leaders agree to an early retirement plan that pays for itself, Mayor Antonio Villaraigosa pledged to veto it.

Antonio Villaraigosa: I believe we need to reject early retirement. Do so with alacrity and dispatch, then begin the process of laying off and furloughing employees. Then, continue to negotiate. But then the negotiations don’t impact our ability to manage this budget.

Stoltze: In June, the mayor backed early retirement. City tax revenues have fallen more than expected since then, so now Villaraigosa argues that he needs the flexibility to institute layoffs and furloughs.

Villaraigosa: What if next month, we’re told that revenues are down even further?

Stoltze: The mayor warned that an early retirement program could force layoffs and furloughs at the police department. City Councilman Greig Smith said that may happen anyway, based on what city number crunchers have called L.A.’s deteriorating financial situation.

Labor union leaders and city negotiators plan to meet today. The city council’s promised to act on an early retirement plan by Friday.