Los Angeles city employees urged the City Council’s budget panel on May 5 to focus on restoring services to reverse five years of “dramatic” cuts made in the aftermath of the 2008 financial crisis.
The City “erred on the side of austerity” in recent years, Ryan Hudson, a research and policy analyst for the Coalition of L.A. City Unions told the council’s Budget and Finance Committee.
The union coalition representing 22,000 city employees, or about 65 percent of the City workforce, delivered a report to the committee, which is holding daily hearings on the proposed city budget for fiscal starting July 1.
Mayor Eric Garcetti’s proposed $8.1 billion budget closes a $242 million projected shortfall and depends on city employee unions going without raises for at least three years and City employees paying 10 percent of their health care premiums.
The mayor’s budget also proposes a 5.5 percent reserve fund, which Garcetti has touted as the largest in the City’s history. However, Hudson said reserve funds are “sufficient and we would like to see some real service restorations.”
Since 2008, the City has seen steep drops in its ability to carry out “neighborhood services,” Hudson said. He said tree trimming had been reduced by 46 percent, and debris removal from City streets has been cut 61 percent.
In the past five years, the City has ended up in the red only in 2008, Hudson said. Since then, the City has had a surplus, he said.
Deputy Mayor Rick Cole recently told the committee that the budget included only modest funding for restoring some services, and that Garcetti was intent on shifting budgeting away from “short-term fixes to long-term fiscal responsibility.”
City employees appeared unconvinced today. Cheryl Parisi, who heads the union coalition, called on the City to “maximize revenues” before making cuts, put the restoration of city services first and to “work to provide good jobs for all Angelenos.”
Parisi, who did not discuss ongoing labor negotiations, said City employees made sacrifices “to help taxpayers cope with economic hard times brought on when unchecked Wall Street greed crashed the economy in 2008.”
Fix L.A., a group that the works with the coalition, released a report in March that said the city spent $65 million in fees to Wall Street firms since 2008 to get out of bad investments and could be on the hook for another $69 million through 2028.
The author of that report, Lisa Cody, said the city may have paid up to $300 million to Wall Street firms – not including loan servicing – in the current fiscal year, rivaling the amount the City gets in sales tax revenue.
Parisi reminded the committee that “City workers voluntarily voted to open their contracts twice and to engage in serious cost-saving strategies with the City of Los Angeles.”
City employees in 2012 came up with ideas that saved $38.8 million. They also agreed to nearly double their pension payments, which “this year alone” saved the City $75.3 million, according to Parisi.
“These savings are real,” she said. “These savings came at great sacrifice to our members, to city workers who literally have taken out of their pocketbooks to work to maintain services in the City of Los Angeles.”
