And a $43.3 million shortfall looms in Fiscal Year 2010

It was the kind of language no one likes to hear used on Long Beach–but he said it. Twice.

“Long Beach is a city of limited resources, and it must live within its means,” City Manager Pat West said Tuesday afternoon–at a 2 p.m. press conference, then again at a 3:30 p.m. unveiling of our new structural budget deficit: $43.3 million in Fiscal Year 2010, and a brief airing of city strategies to balance the budget.

(You don’t have to applaud.)

“This budget will be one of the most difficult budgets Long Beach has ever faced during its history, due to the national, local and regional economy,” West said in remarks to the press, in the 13th floor conference room at City Hall. “This is the worst recession since the Great Depression.”

In Long Beach, where Fiscal Year 2008-2009 ends Sept. 30, finding $43.3 million in Fiscal Year 2010 means looking for it now; city staffers must present Mayor Bob Foster with a shiny new budget by July 1. Foster will then have a month to try to tear it in half like a phone book (not really).

Foster will have a month to prepare his response to the budget–which he will then present Aug. 1; afterwards, Long Beach City Council will consider the amended document, which must be approved by midnight Sept. 30.

With that in mind, here’s the bad news:

“In order to put together the Fiscal Year 2010 budget, I’m going to be recommending a three-tiered approach to the council,” West said, “including employee negotiation solutions in the amount of $23 million; departmental reductions of $20.3 million–a six percent cut applied to departments–and enhanced revenue collection if anything changes in the economy.”

So, what about the cuts?

We don’t know yet, obviously, but West said that in general, trimming $43 million from the budget can be done variously by mandating 49 furlough days for city employees–or equivalent savings; or by 12 percent department cuts; or by 39 percent departments cuts, if the police and fire departments are unscathed; or 569 civilian lay-offs; or 338 lay-offs of sworn police and fire personnel; or some combination of the above.

But that’s a single-strategy approach; the city manager recommended his three-tiered strategy.

Using that model, West said, the city can get to $23 million in employee contributions through a similar grab bag of possibilities, including mandating 26 city employee furlough days; by mandating city employees pick up their share of the retirement benefits; or by 302 civilian lay-offs; or 180 lay-offs of sworn police and fire personnel; or by forgoing or freezing negotiated city employee salary increases.

Or–by some combination of those strategies.

Sound confusing? It is rather confusing.

There are, West said, any number of ways to balance the $43.3 million structural budget deficit.

But while the Fiscal Year 2010 Budget Preview he presented Tuesday afternoon outlined 12 percent departmental cuts; and even draconian 39 percent departmental cuts, West strongly advised against trimming city departments any more than six percent.

“As this city council’s city manager, it really pains me to recommend this approach, but the economy, combined with the state of the budget deficit, leave me no choice,” West told the press.

“My office will be taking reductions, and it is my expectation that my management team will share in the reductions as well.”

“I basically believe that we cannot cut our way out of this and still be the great city we are on the way to be,” West said later in council chambers, pointing out that if Long Beach still retained its utility users tax, that alone would generate approximately $40 million in Fiscal Year 2010–almost enough to cover our structural budget deficit.

“And that’s the good news?” asked Third District Councilman Gary DeLong, when West had finished his presentation.

“That’s just the news,” Foster replied. “That’s just the way it is.”

Eighth District Councilwoman Rae Gabelich wondered how many millions we could save if the police union, the Long Beach Police Officers Association, agreed to forgo raises or to freeze its members’ salaries.

“Sixteen million [dollars of the $23 million in ‘employee negotiation solutions’] was [police department], right? Can you break that down?” Gabelich asked.

“At this point, we don’t have an exact number to give you, but we do have a range that we’re projecting,” said Assistant City Manager Suzanne Frick, noting that the city is in negotiations with the police union, “and that is in the range of 5 percent to 14 percent. The $23 million includes all the bargaining units and their [pay] increases for Fiscal Year 2010.”

“So, if everyone agreed to a freeze, that would allow us to realize the $23 million?” Gabelich asked.

“That’s correct,” Frick said.

Later, the councilwoman gave a nod to the utility users tax.

“I know nobody wants to initate new taxes. But the reality is that we, as citizens of this city, voted on that, and I’m not quite sure what the reason was,” Gabelich said.

“The reality is, there’s more to the story than the dollar figure [in savings by repealing the tax], which I don’t think enough people examined.

“I believe with all my heart we’re going to have to find a new revenue source, and I don’t think it’s going to come from the people. And it’s not just the cuts, but what are the results of the cuts? If we would take the kind of cuts that are being identified in this document, we are not looking at a healthy, vibrant city.”

“All that on top of furloughs? Wow,” said Rich Brandt, president of the Long Beach Firefighters Association, the firefighters union, who spoke during public comment on the budget.

“The men and women of the Long Beach Firefighters Association feel strongly that all city employees should assist their city. The firefighters have decided to voluntarily give back to the city,” Brandt said, noting that Association members will “voluntarily return 1.9 percent of their compensation package.”

Brandt didn’t put a dollar amount on the return, but said: “This give-back is equal to what other city employees are being forced to contribute in the form of furloughs. As a result of the give-back, service levels … will remain unaffected for 2009.”

“To say it’s not good news is an understatement,” Foster said after public comment. “The city is in very difficult straits. The reason some of these illustrations are up there is to give everyone an idea of how serious this is.

“We’re gonna have to all work together to make this work for the next couple years,” the Mayor continued. “I’d like to see a city that pays competitive salaries, but to be honest, that list [of cities paying competitive salaries] is going to change as well.

“The key for everyone up on this dais is to do everything we can to keep service to our constituents at a certain level.

“We cannot print money. We cannot borrow money, and we cannot without difficulty raise taxes. We can but it takes time. And certainly, in this economic environment, there will be some who question the wisdom of doing so,” Foster said, and for a minute you wondered if he was remembering the fate of Measure I, his parcel tax–the most expensive ballot measure in Long Beach history–which unimpressed voters snubbed last fall.

“Let’s get a solution that is not pleasant to you, not pleasant to us, but allows us to function as a city,” the Mayor said.

Tags: California, Fiscal Year 2010, Long Beach, Southern California, structural budget deficit, The District Weekly, Theo Douglas