Los Angeles’ projected $1 billion budget deficit will force nearly every city department to do more with less. Over the next two months, the city will have to figure out how exactly to make it work – and how many workers will have to be laid off.
“We're not a corporation where we have a lot of fat to cut. We don't have a 20% profit margin,” Councilmember Adrin Nazarian told KNX News’ Craig Fiegener. “Whatever we're cutting, we're basically cutting vital services, and then doubly impactful, at some point, conducting layoffs, potentially.”
City Administrative Officer Matt Szabo told the City Council last month that thousands of layoffs would be “nearly inevitable” given the budget gap. But one potential plan to minimize the impact would involve going back to the city’s labor unions and asking them to give back the pay raises they recently negotiated.
“I think we can partner up with our friends, our partners in labor and figure out how we can get through this,” Nazarian said.
Szabo attributed L.A.’s budget woes to rising legal payouts and shrinking tax revenue. January’s wildfires will likely worsen the problem, not only because of the astronomical cost of rebuilding, but also because of thousands of workers losing their jobs.
During Thursday’s budget committee meeting, there was a recommendation to explore launching a temporary basic income program for people affected by the fires, but the looming billion-dollar deficit halted the discussion.
“We're expecting deep cuts and potentially layoffs, and I'm worried about starting new programs,” Councilmember Bob Blumenfield said.
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Councilmember Katy Young Yaroslavsky, who chairs the budget committee, said the council needs to be “thinking about what comes next” to avoid similar challenges next year.
“We need to figure out what long term changes are necessary to break out of the cycle of annual budget crises and build a more stable, sustainable foundation for our city's future by creating an advisory group made up of experts in finance, real estate, liability, civic engagement, and public service,” she said.
Mayor Karen Bass will release her proposed budget for the upcoming fiscal year on April 21.
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