L.A. council delays decision on cutting 1,000 jobs


After struggling for eight hours to counter a rapidly growing budget shortfall, the Los Angeles City Council put off a decision to cut 1,000 jobs Wednesday and, through other actions, managed to add $4 million to the problem.

Unable to take more straightforward action on a shortfall that has grown to $212 million this year, the council voted to seek another list of possible job cuts and, after hearing pleas from a chamber packed with protesting employees and residents, promised not to act on layoffs for 30 days.

Members also postponed the elimination of three city departments as they search for new sources of revenue, including uncollected debts and federal stimulus funds.

Council leaders had hoped to strike a compromise between the group’s budget hawks, who have been calling for layoffs for more than a week, and the doves who sought to save the jobs of civilian employees. But Councilmen Greig Smith and Bernard C. Parks, who favored the job cuts, said the series of votes had only added to the crisis.

“We’re becoming Sacramento south,” Smith said. “We’re sticking our heads in the sand and hoping it goes away.”

City Administrative Officer Miguel Santana also voiced dismay, saying that he fears that Wall Street rating agencies will respond by downgrading the city’s bond rating -- hiking the cost of borrowing and adding to the burden on taxpayers.

“I’m concerned about the message this sends to our bond rating agencies,” he said. “They want to see action from the city” on the budget crisis.

Council President Eric Garcetti, who crafted the compromise, put a friendlier face on the delay, saying that it would give the council breathing room as it searches for alternatives to layoffs. “This does not stop the wheels from turning on layoffs should all other options fall short,” he said.

The council also postponed a decision on proposals to eliminate the Department on Disability, the Environmental Affairs Department and the Human Services Department, pushing back those decisions for another month. And they refused to cut funds for neighborhood councils.

The Coalition of L.A. City Unions hailed the series of votes as a victory both for its 22,000 members and for city residents. Coalition attorney Victor Gordo, whose organization had fought the layoffs, said he still hoped that the city’s payroll could be shrunk without forcing layoffs.

“This is what needed to happen,” Gordo said. “We believe that the direction given by the council today will lead to a thoughtful resolution of this budget crisis.”

The city’s budget advisors have spent the last month trying to persuade Mayor Antonio Villaraigosa and council members to support widespread reductions in the workforce. Cutting 1,000 positions would save $65 million over a full year, officials said.

Councilman Jose Huizar, who opposed the proposed reductions, complained that the move would do little to address this year’s crisis, generating only $15 million by the end of the fiscal year on June 30. Those savings are small, in part, because the city’s existing agreement with the union coalition bars its members from facing layoffs this year.

“We have a $15-million plan to address a $200-million gap,” Huizar said.

Santana, the top budget advisor, said layoffs still could have been imposed on other groups, including the Engineers and Architects Assn. He argued that a larger layoff effort was needed to prepare for July 1, when the city will face a new shortfall of at least $484 million.

Unless the city has its house in order, it will be unable to cover the salaries, healthcare and retirement coverage of those employees who remain, Santana said. “We have a responsibility to the workers that stay behind,” he told the council. “We . . . owe it to them to meet our obligations.”

To avert layoffs, the council approved a plan to move at least 306 workers into positions unaffected by the crisis in the city’s general fund budget, which pays for basic services such as public safety, parks and libraries. Still, the city will need to drain much of its reserve fund to get through the next five months and borrow money to get through the next two years.

The votes were a victory for council members Janice Hahn, Paul Koretz and Richard Alarcon, each of whom demanded alternatives to layoffs. Alarcon said the council should demand a 10% reduction in the contracts of the city’s consulting firms and contractors and spend more time analyzing cost-saving proposals submitted by the coalition.

“I believe they have the best solutions moving forward,” he said.

In a separate vote, the council agreed to limit the number of low-income seniors and disabled residents who can participate in a program that subsidizes 100% of the cost of trash pickup.

Eight hours into the meeting, Santana and his advisors told the council that they had cut $6 million in programs but added $10 million in costs. Santana laid out his score card after hearing Councilman Herb Wesson voice doubts about the day’s accomplishments.

“I just have this weird feeling that we are going in the wrong direction,” Wesson told his colleagues.

Times staff writer Maeve Reston contributed to this report.