Villaraigosa’s $7.05-billion budget calls for 10% cut to personnel costs

Los Angeles Mayor Antonio Villaraigosa on Tuesday released a $7.05-billion budget staked heavily on his ability to win concessions from employee unions and cut deals to lease parking garages, two essential yet unresolved components to closing an estimated $530-million shortfall.

Saying the nation’s spiraling recession requires “extraordinary sacrifice” from all corners of the city, the mayor called for all departments -- including police and fire -- to cut personnel costs by 10%. The resulting $231 million in savings would come either from laying off 2,800 workers, he said, or a “menu of options” that could include pay freezes, furloughs or early retirements.

“Massive layoffs and draconian service cuts are not inevitable, but everyone including our police and firefighters must work together in the spirit of shared responsibility and shared sacrifice,” said Villaraigosa, who will continue to make his case in a number of town hall meetings.

Villaraigosa’s comments come after weeks of public warnings about the city’s growing fiscal crisis, putting pressure on the city’s powerful public employee unions -- major political supporters of the mayor -- to come to the bargaining table. The posturing continued Monday with Villaraigosa’s pledge to cut his own $223,000-a-year salary by 12% and freeze his staff members’ salaries. Los Angeles employs about 50,000 workers.

The mayor’s budget now goes before the City Council, which has 10 weeks to accept or amend the sweeping spending plan that arrived with critical components still in question. Those include one of the mayor’s main sources of anticipated revenue: an $80-million windfall from leasing six city-owned parking garages to private investors.

Councilman Greig Smith, who represents the northwest San Fernando Valley, said it was “wishful thinking” to include those leases in the budget because they are nowhere near completion: “It’s a very risky move,” he said.

Council President Eric Garcetti said he had questions about how the parking-lease money would be used, but said that overall he was pleased that the figures in the mayor’s budget were “real” and not overly optimistic. The sticking point for council members, he said, would be ensuring that the city uses “long-term revenues for long costs and that we use one-time revenues or savings to address one-time costs.”

Garcetti and several members of the council’s budget committee said Villaraigosa had taken the right approach by laying out his “menu of options” for union concessions to keep negotiations open, rather than laying out a more firm plan for layoffs.

“The mayor and the council are united in working with our employees to find these savings and to do this together -- not to impose this on anyone,” Garcetti said. “We all know the impact of layoffs on people’s personal lives, we know the impact of layoffs in services, and whatever we can do to make that the last option in the menu, I think we’re together.”

Villaraigosa has said he is committed to his pledge to build a police force that tops 10,000 officers, even though violent crime in the city is at a historic low. The mayor said public safety is critical to improving the day-to-day lives of Angelenos and plays a role in attracting business, development and tourism.

The mayor still is asking the police and fire departments to make a 10% cut in their salary accounts, but he has not specified how they should achieve those savings.

Eric Rose, a spokesman for the Los Angeles Police Protective League, said Monday that because union leaders are currently negotiating for a new contract, they are “not in a position to talk about what they will or will not do in relation to shared sacrifice.” The union initially characterized the mayor’s proposal as a cut to public safety.

The Coalition of L.A. City Unions, which represents 22,000 workers, is pushing for an early retirement package as an alternative to layoffs and cuts to pay and benefits.

The coalition is negotiating with representatives of the mayor, but no agreement has been reached. Villaraigosa has said that an early retirement package would not produce enough savings to eliminate the need for other concessions.

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phil.willon@latimes.com

maeve.reston@latimes.com

Times staff writers David Zahniser and Joel Rubin contributed to this report.