Villaraigosa’s deficit-reduction plans anger labor

Mayor Antonio Villaraigosa, a former union organizer and a longtime favorite of organized labor, angered some of his ideological allies last week when he asked the City Council for the authority to lay off and furlough thousands of city employees to close a $529-million budget deficit.

Union leaders are also feeling betrayed over the mayor’s decision last week to jettison an early retirement plan that labor and city officials had been working on for more than a year. Early retirement would have been offered to workers within five years of retirement eligibility.

“The mayor is supposed to be a union-oriented mayor, but I don’t see it,” said Roy Stone, president of the Librarians’ Guild, Local 2626, which represents city librarians. “We’re feeling extremely disappointed, extremely betrayed. It’s like being stabbed in the back.”

Villaraigosa has cited the need for hard choices and “shared sacrifice” amid a profound fiscal crisis that is hitting local governments nationwide. He called the early retirement plan too costly.

“The unprecedented downturn in the national and regional economy, combined with the impact on our pension investments, has led the city to a fiscal crisis of growing and unanticipated proportion,” Villaraigosa wrote last week in asking the City Council to declare a fiscal emergency.

Some say the mayor, who is widely believed to have gubernatorial aspirations, is faced with a difficult but potentially defining choice: taking a hard line with his friends in the labor movement or being seen as weak and indecisive in the midst of a deep financial crisis.

“If you’re going to run for an executive office, at the end of the day you have to be able to make decisions for the greater good of the community, regardless of alliances and history and who’s powerful at City Hall,” said Raphael J. Sonenshein, a political science professor at Cal State Fullerton. “I don’t think the mayor would purposely go out and get into a fight with organized labor. It’s more a case of an economic necessity that, if it helps address the budget crisis, may also have some political advantage.”

Despite angering some union leaders, the mayor still retains strong support in the influential and resurgent California labor movement. The state’s public and private-sector unions, although far from monolithic, remain closely allied to the Democratic Party.

In seeking cuts, unions prefer a system of preferences to encourage early retirement, allowing longtime employees to leave and receive their pensions, enhanced in some cases. The plan that city and labor officials had been working on could have taken more than 2,000 workers off the payroll and avoided layoffs, furloughs and other cuts, according to labor officials.

“The question is, do you allow your highest-paid employees to retire early, or do you have massive layoffs from among your lowest-paid workers?” said Barbara Maynard, a spokeswoman for the Coalition of L.A. City Unions, which represents more than 22,000 civilian city workers.

Union officials say Villaraigosa “abruptly abandoned” the early retirement plan, which he seemed to endorse publicly just last month when he said such a plan could eliminate “deadwood” while retaining younger, more productive workers.

But the unions’ plan would have added as much as $850 million in liability in the next 15 years to the city’s already underfunded pension system, while also requiring deep cuts in city services, said Matt Szabo, a mayoral spokesman.

“The mayor has always been open to an early retirement proposal, so long as it’s in the best interest of the city,” Szabo said. “Unfortunately, the unions’ proposal was simply too expensive and would have required draconian cuts in city services.”

Labor leaders say the increased pension costs were closer to $400 million, much of which would have been covered by bolstered employee contributions to the pension plan. They were especially upset that the mayor revealed his decision to take the early retirement plan off the table to the media before contacting the unions.

Unions are planning a lunchtime “rally for city services” today as budget hearings begin at City Hall. Labor leaders are trying to pressure the mayor to seek alternate means to trim the city’s 50,000-member workforce.

The mayor said that if the council agrees, he intends to implement work furloughs within 30 days. He said he had invited a labor representative to discuss the effects of the plan, which would require up to 26 furlough days for civilian city employees next fiscal year.

Villaraigosa said he would be working with the City Council and labor officials to develop a buyout program to permanently reduce the city’s civilian workforce. He is also pushing for city workers to give up their cost of living increases or make other concessions, such as paying more for their pensions and healthcare.

The budget battle comes as difficult negotiations are underway with the city’s police and fire unions, though the mayor has sought to exempt officers and firefighters from layoffs, along with other workers providing essential services, such as trash collection. Representatives of uniformed workers have already warned against any move that could compromise public safety.

Notwithstanding the acrimony, both sides express the hope that an acceptable budget solution will emerge.

“Our membership has partnered with the city every step of the way,” said Daniel Villao of the Building & Construction Trade Council, part of the citywide labor coalition. “And we’re calling on the city’s leadership to stay with us at the table and to continue until we get a solution that works for the citizens of Los Angeles.”

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patrick.mcdonnell@latimes.com

Times staff writer Phil Willon contributed to this report.