L.A. Mayor Karen Bass Proposes 1,647 City Employee Layoffs Amidst Huge $1 Billion Budget Gap

During her state of the city address on Monday, Los Angeles Mayor Karen Bass announced several cuts and rollbacks in the city budget to close the nearly $1 billion city budget deficit, including the layoffs of 1,600 employees and the elimination of 1,000 positions.

Taking place at Los Angeles City Hall, Bass’ state of the union went into her proposed budget, with massive cuts on the way. She blamed economic policies from Washington, the rising costs of liability settlements, climbing personnel costs, and the Palisades fire for the nearly $1 billion deficit. All of the reductions mirror the proposed budget reductions by Los Angeles City Administrative Officer Matt Szabo last month. Of particular note is the $250 million increase in labor costs from last year caused by new union contracts and $282 million stemming from wildfire losses and spending.

“The reality is that our city faces a more than $800 million dollar deficit,” said Bass in her speech. “Cities like ours are going through challenging economic times across the nation. Turmoil and uncertainty from Washington and a slowing economy are causing lower revenue projections to the tune of hundreds of millions of dollars. Liability settlements have tripled from backed up lawsuits during the pandemic and uncapped damages. Combined with personnel costs, and of course the fires and the rebuilding all together, Los Angeles we have a difficult budget to balance.

“Since January, I’ve been in active conversations with our partners in labor to find solutions to address a worsening economic outlook. We identified new revenue to offset costs. We reduced funding for the Mayor’s Office. We further eliminated “ghost” positions, and we postponed some capital projects.

“But now, I would like to take a minute to address our city workforce directly: Make no mistake — you are this city’s greatest asset. Every single day, you come to work in dedicated service to the people of Los Angeles, often in challenging working conditions – you help Angelenos and you help make our city better every day. But I want to be straight with you – my proposed budget unfortunately includes layoffs, which is a decision of absolute last resort. The City Attorney and I will be in Sacramento this week to meet with legislative leaders and advocate for resources while further working to manage the increasing liabilities.

“Now, we’re also taking steps to make our city run in a more efficient manner– we’re going to consolidate departments, rebuild our reserves and reorganize structures with the number one goal of improving service for Angelenos. I was proud to have supported new labor contracts, approved by the Council, that invested in our workforce.”

According to her budget proposal, 1,647 city employees are to be let go, with more than 400 of those coming directly from LAPD civilian positions. Other departments also have more than 100 layoffs each, including the departments of transportation, sanitation, street services, planning and general services. On top of this, around 1,000 currently vacant positions are to be eliminated. As the city currently employs 32,405 people, the proposed layoffs would affect around 5% of the city’s total layoffs. Originally, Bass wanted 3,500 city employees to be laid off, but about half of these were saved by other reduction actions, including deferring capital projects.

“This budget makes investments to continue our progress on critical challenges like decreasing homelessness and crime while bringing the City’s finances into balance and driving change including common sense consolidations of related departments,” added Bass. “Homelessness is down. Crime is down. These are tough challenges, and our progress shows we can do anything in this city of limitless potential.”

Mass layoffs planned by Bass

In total, her new budget proposal comes out to $13.95 billion. Besides layoffs, Bass outlined consolidating several city departments, ending multiple commissions, and deep cuts to other departments and city services. Street services, for example, would see their budget be cut by 20%. While a few departments would see budget increases, with the LAFD getting a 13% boost following the fires earlier this year, most will have to deal with significantly less.

Unions and city worker groups have vowed to fight the proposed layoffs at every turn, with the SEIU saying that they are prepared to right against every planned layoff.

“We’re always glad to have a conversation about how to make things more efficient in the city of LA, but that shouldn’t include laying off the folks doing the work,” explained SEIU 721 president David Green on Monday. “I’m going to push back and fight against every single one of these layoffs. These are folks who are frontline workers serving the community every day.”

Bass tried to undercut the massive budget cuts with state of the city began with some hopeful news. This included calling for the permit process to be expedited for replacement homes in the Palisades following the January wildfires, announcing that both total crime and homelessness have gone down (marginally), wanting the state to triple the film and TV tax credit, and updates on Olympics efforts.

“We are taking action and making change, and after years of increasing homelessness, we are finally reversing that trend – homelessness is down,” added bass in her address. “We are moving thousands more people from the streets than before we took office, and more Angelenos are being moved into permanent housing than ever before. All of this comes as, nationwide, homelessness went up 18% – but not in Los Angeles.

“We will continue to advocate in Sacramento for the tax credit, but LA, Angelenos – we also have to do our part here. So going forward, we will make it easier and more cost effective to film on city property. And we will also streamline the permitting process to make it easier to film in LA.  So to our leaders in Sacramento – and to our local industry leaders here – I say, – let’s bring Hollywood back.”

However, Bass’ budget is far from a sure thing. In addition to the promised fight against cuts by the different unions, it still has to go through the City Council. And after her speech on Monday, many City Council members expressed some reservations in approving her budget as is, especially the major slash to the LAPD.

“I commend Mayor Bass for making tough choices in a tough budget year, but we know that our residents expect us to make decisions that help departments work better, not just smaller,” said City Councilwoman Katy Yaroslavsky.

The budget proposal is expected to go before the City Council soon, with the final budget approval by June 1st.