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LA Mayor Warns Of Possible Layoffs As City's Projected Budget Shortfall Grows

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The Los Angeles City Hall photographed in August when it was lighted to commemorate the passage of the 19th Amendment. (Valerie Macon/AFP via Getty Images)
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The City of L.A. is bracing for potential layoffs as COVID-19 continues to devastate the economy.

In a memo released today, Mayor Eric Garcetti ordered all Los Angeles City department managers to identify “non-critical” positions and services to eliminate.

The grim fiscal writing has been on the wall for months. Almost as soon as the mayor proposed his new budget in April, analysts were warning it was too optimistic about local tax revenues during the pandemic.

The city has tried offering employee buyouts and last week declared a fiscal emergency to clear the way for worker furloughs that amount to a 10% pay cut for civilian employees. But it’s not enough to bridge the gap.

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In his latest update, City Administrative Officer Rich Llewellyn projects the budget shortfall could be between $200-400 million dollars, assuming the economy mostly returns to normal by early 2021.

"It is abundantly clear that the City must implement additional and arguably more severe austerity measures,” Llewellyn said.

READ THE MAYOR’S MEMO

Garcetti writes in the memo:

“We must take action now to put ourselves in a better position to withstand the financial crisis created by the COVID-19 pandemic in our City.”

Along with laying the groundwork for layoffs, he also ordered department managers to find more places to cut costs and asked labor negotiators to work with public employee unions to delay or reduce planned pay raises.
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Garcetti added that employee buyouts are going forward and a hiring freeze will remain in effect for the foreseeable future. Furloughs that were approved by the city council last week “may” be implemented, the mayor said.

The city agreed to raises for sworn LAPD officers, firefighters and civilian employees during the halcyon days of the strong economy in 2019. The total cost of a new bonus program and pay bump for police added about $123 million to the FY 2020-21 spending plan, for example.

A proposal from council members Mike Bonin and Marqueece Harris-Dawson to ask the Los Angeles Police Protective League (LAPPL) to delay raises until the fiscal situation improves failed in the City Council last week.

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