COSTA MESA — City officials have crunched the numbers and determined that more than 200 Costa Mesa employees — or 43% of Costa Mesa’s municipal workforce — could be laid off through outsourcing.
Of the 472 full-time positions, 203 city employees, give or take one or two, will get pink slips notifying them that they could be laid off in six months, said Administrative Services Director Steve Mandoki.
It’s unclear when officials will notify employees, but based on the large number of city workers who turned out to Tuesday evening’s City Council meeting, which lasted into the early hours of Wednesday morning, there might not be many who haven’t already heard by now.
In a 4-to-1 vote just before midnight Tuesday, with Councilwoman Wendy Leece dissenting and despite nearly unanimous opposition from the audience, the Costa Mesa City Council approved contracting out 18 city services by the fall.
“This has been coming on for a long time, and we’re coming to a point that’s rock bottom,” Mayor Gary Monahan told the crowd of mostly city employees.
Monahan, like many of the council members, blamed years of missteps by city staff or the council itself for leaving the city in its current budgetary predicament.
“The world works on a calendar and a clock,” Mayor Pro Tem Jim Righeimer said. "[On] July 1 we have a new budget. What’s happened in previous councils was we’d wait until the 11th hour and push something through.”
Tuesday’s move is part of a dramatic restructuring of a city that faces potentially skyrocketing pension costs in the coming years.
Overwhelmingly criticized as too fast and too radical by residents and city employees Tuesday night, City Council members were considering outsourcing a broad array of city services to still-undetermined private companies.
“What we don’t need is to outsource our own needs of local government to strangers who have no stake in our lives or property values,” Costa Mesa resident Eleanor Egan said before the vote. “If you go forward with this, you should be ashamed.”
Costa Mesa’s own projections show that in the next few years, it will be expected to pay more into the state’s public pension fund, CalPERS. It’s a situation being replayed up and down the state: When the CalPERS pension fund was flush in the early 2000s, Costa Mesa did not have to pay much to the state to cover its employees’ retirement costs. Now that CalPERS investments are hurting, cities have to cover the difference.
That pattern looks to continue for at least the next five years, city officials project.
Laying off hundreds of employees and their accumulating pensions by the fall would help to balance the city’s budget in years to come, council members reason.
“We’re going to run out of money sometime this year if nothing changes,” said Councilman Eric Bever.
For nearly two hours, members of the public came up and voiced their opposition to outsourcing. Speakers argued the level of service in the city would drop, it would affect employee morale and that the city would never recover from laying off so many so fast.
“Today you are starting the process of putting the heart of your community up for sale, too,” said Jennifer Muir, communications director for the Orange County Employees Assn. “Why would the city sell its most valuable asset?”
Not everyone was against the move, however.
“If you were starting a city tomorrow and trying to operate on a zero-sum budget, would you do this?” said Jeff Jones, a Costa Mesa resident. “We need to look at everything. We need to start over. To leave it alone doesn’t make sense.”
Tuesday’s move is only the first step in the process, though. The motion gives city employees a six-month notice that their job will be replaced by a private-sector employee. From now to September, council members will search for companies to replace city services and hire them.
Because of “bumping” rights in city employee contracts, even workers in city services not up for outsourcing could be affected, Mandoki said. If an administrative assistant in code enforcement has worked in the city for 20 years and gets laid off, he has the right to replace an administrative assistant in another city department who has less experience.
If council members don’t find what they’re looking for, the city can rescind its layoff notices at any time. Employee association leaders said later that morale is at an all-time low, with many city workers fretting about whether they’ll still be on the city’s payroll come the end of summer.