City Council Passes Budget Despite Calls to Delay Vote

The Long Beach City Council approved the $87.9 million 2012-13 budget Tuesday, despite calls from council members, union officials, taxpayers and city employees to table the vote on the document another week.

The council voted 3-2 to adopt the spending plan that represents a 2.6 percent tax levy increase and a 5.3 percent deficit reduction surcharge, down 4.1 and 11.9 percent respectively from the original proposal. “We’ve cut the size of the tax increase by more than half, from the combined 16 percent, and now it’s 7.9 percent,” Schnirman said during a pre-vote presentation.

The city must close a $10.2 million deficit and balance the budget before the new fiscal year starts on July 1, or face possible penalties, including a further downgrade to its credit rating to junk bond status that could hinder future borrowing and impact payroll, the city manager said. “It is crucial the city pass a balanced budget, and once that happens, the fiscal crisis is not over, there’s still work to be done, but we are absolutely on the road to financial recovery,” said Schnirman.

 Schnirman said the city was able to reach these numbers through various means, including an early retirment incentive, spreading payment for debt service out over 10 years instead of three, and personnel reductions.

Council members John McLaughlin and Michael Fagen both voted to table the budget vote until next Tuesday, in order to renegotiate contracts and pursue other potential cost-saving measures and save jobs. In particular, they called on Schnirman to spread the personnel reductions more evenly, across all departments and employees, from exempt to part-timers, after the city announced last week that 67 workers (25 full-time employees and 42 part-time workers) would be laid off, a move projected to save $2.5 million each fiscal year.

“These cuts aren’t shared equally,” McLaughlin said. “The CSEA, they’re probably about 50 percent of our payroll, yet they’re taking 70 to 75 percent of the hit.”

McLaughlin noted that while the fire department took a pay lag and the CSEA was asked to take a two-year wage freeze, but he didn’t see any proposals for the Police Patrolmen’s Association. Schnirman said that the union was in binding arbitration.

“I think we have until the 31st, and I think that we need to take that time to sit down and get all the unions together, get the fire, PBA and CSEA, and have everybody sit at the same table and come up with something,” McLaughlin said.

Earlier, Schnirman announced a second round of layoffs involving 38 CSEA workers after the city and union failed to come to a contract agreement days and hours before Tuesday’s meeting. The city proposed a giveback package that was projected to save $2.1 million, but the union rejected it, Schnirman said.

“Calling me on Sunday night, two days before a budget vote, giving me a $2.5 million number is not what I call negotiations,” CSEA President John Mooney told Schnirman. “If I had this number earlier, there are different things we could do. To ask the members to vote on something in two days is disgusting.”

But Schnriman said that the $2.5 million was essentially the same number that he had presented in his presentation at last week’s budget hearing. “To say that we’ve been rushing, is not totally accurate,” he said of the negotiations. “We’ve been working on this for two months.”

To underscore his stand that reductions should be made across the board, Mooney told Schnirman that he, too, should take a 50 percent pay cut. “If it’s good for you, it should be good for everyone else,” he said.

Prior to the vote, Fagen went through the line-by-line budget, searching for areas where more money could be saved to potentially prevent proposed layoffs, from the Ice Arena to city clerks to police overtime.

“I believe we should table this,” Fagen said about the vote on the budget. “I think there’s more work to be done. I think there’s more jobs to be saved. And I believe there should be more taxes cut.”

While in his presentation Schnirman noted that the budget further reduced police overtime, by an additional $100,000, Fagen questioned whether more reductions were possible. “Why are we going ahead with only a 10 percent reduction in budgeted overtime,” he said.

At one point, Fagen called on Police Commissioner Michael Tangney to cut his salary, after the two debated his base pay, overtime and perks compared with the prior commissioner. 

 “I would ask you, on behalf of the city, along with rest of the exempt employees, to take a 15 percent pay cut,” Fagen said to Tangney.

Similar to last week’s budget hearing, many residents addressed the council, some praising Schnirman for his detailed presentations and decisions, while others blasted his proposal, including a water department employee who screamed at him for getting laid off. Others challenged the council more civilly.

“You’re telling us our taxes will be lower, but meanwhile we’re going to have to pay for it over ten years instead of three,” said Larry Moriarity, and East Olive Street resident, about the debt service payments.  “That’s just games. …It’s just kicking the can down the road.”

Council President Fran Adelson said that while she understood that “the pain … should be spread equally,” she asked others to consider circumstances from the council’s perspective. 

“This has been very hard and very difficult,” she said. “I know that that’s not important to you, but we do know that people are losing their jobs, and we know that these are very hard times for everybody.”

Scott Mandel said that he and his fellow councilmembers have to make hard decisions. “There’s no happy ending in this," he said. "Unfortunately, one way or the other, we have to make the decisions.”