Hundreds of L.A. residents and city workers packed Van Nuys City Hall chambers on Friday and Monday to protest planned layoffs and cuts to city services. The Budget and Finance Committee had scheduled the two special hearings to discuss a $13.9 billion budget proposed by Mayor Karen Bass for the 2025-26 Fiscal Year.
The city is facing a nearly $1 billion deficit brought on by rising labor costs, liability payouts, the January wildfires, and a 35% reduction in tax revenue. Bass has proposed laying off 1,647 workers and eliminating another 1,053 vacant positions. Around 5% of the city’s workforce would be on the chopping block.
The mayor’s plan would cut nearly $500 million from Los Angeles Animal Services, potentially leading to the closure of animal shelters across the city. Personnel cuts would also hit transportation, sanitation, and street services. Several commissions would be eliminated. The Departments of Aging, Youth Development, and Economic and Workforce Development would be merged. City financing of affordable housing units would drop by 80%, going from 770 homes in the current fiscal year to 160 homes in 2025-26.
There would be no cuts to core public safety services, but there would be non-officer staffing cuts within the police department. The fire department would receive funding to hire another 227 employees.
The spending plan still represents an 8.2% increase over the current budget. Bass is lobbying state officials for a relief package to further offset austerity.
"My proposed budget is balanced but we are facing dire economic times. It's more important now than ever that we work closely with our state and labor partners, especially as we rebuild in the Palisades," Bass said in a statement.
Not everyone sees it that way.
“Balancing the budget on the backs of essential workers and services means these cuts equal threats to public safety, and will increase future liabilities,” Jenita Igwealor, SEIU Local 721’s regional director, told the Budget Committee on Monday.
Lisa Palombi, who heads the Librarians’ Guild AFSCME Local 2626, warned that the cuts “will be substantial and will be easily visible.”
Representatives from the city’s 99 Neighborhood Councils also decried the planned reductions.
The cuts may be painful, but the current situation is unsustainable — and it’s already having an impact. On Friday, S&P Global Ratings lowered the city’s bond ratings. The long-term rating for general obligation bonds is now AA- (down from AA). The rating for lease revenue bonds went from from A+ to AA-. If the city does not alter its course, the ratings could fall even further, S&P warned. Declining bond ratings could lead to higher interest rates, making it more expensive for the city to borrow money in the future.
The full City Council will now hold deliberations on Bass’ budget proposal and must adopt or modify the plan by June 1. The deadline to approve a final budget is July 1.