LOS ANGELES (CNS) – Mayor Karen Bass Tuesday signed an agreement Tuesday that she said will avert the planned furlough of some municipal employees and all remaining civil service layoffs for fiscal year 2025-26, an outcome resulting from months of negotiations with labor unions.
In April, the mayor had proposed more than 1,600 layoffs as part of an effort to eliminate a nearly $1 billion budget deficit caused by overspending, skyrocketing liability payouts, lower-than-expected tax revenues, and a weakening economy, among other challenges. The number of layoffs was later reduced to 600 after budget maneuvering by the City Council.
During a news conference at City Hall Tuesday, Bass said negotiations with labor unions protected the workforce and preserved city services.
“We embrace creative solutions and work aggressively toward our shared goal because that is our mission; that is our charge, to refuse to allow challenges to slow us down, and we will move every ounce of urgency we possess to continue moving Los Angeles forward in a new direction away from the old failed ways of doing business,” Bass said.
David Green, president and executive director of Service Employees International Union, which represents approximately 11,000 city employees, described the agreement as “historic,” and one that ensures workers will keep their jobs while helping the city to increase revenues.
“These essential workers provide services, everything from animal care, wastewater management, and so much more. And it’s no secret that working families across the country are under attack in Washington with a so-called Big Beautiful Bill, cutting $1 million funding from frontline public sector workers and services our members provide, and ripping up healthcare, taking it away from millions and millions of Californians and people across the United States,” Green said.
“At the same time, volatile tariffs are threatening city revenues and all of our wallets. Despite all these daunting budget realities, we stood strong. We negotiated a historic package that protects our essential frontline city workers from layoffs,” he added.
Matthew Maldonado, executive director of the American Federation of State, County and Municipal Employees District Council 36, representing 10,000 city employees, echoed Green’s sentiments. He thanked city officials for their hard work, as well as union members for their collaboration.
Of the 600 layoffs, about 250 Los Angeles Police Department civilian positions were proposed for elimination, however, an agreement with the Los Angeles Police Protective League, which represents sworn officers, saved those jobs.
The LAAPL agreed to have its members voluntarily take overtime as paid time off in order to reduce LAPD’s overtime expenses and eliminate civilian layoffs.
Meanwhile, the LA City Coalition of Unions and Engineers and Architects Association agreed to take up to five unpaid holidays in 2026 to avoid another 300 civilian layoffs.
The mayor said additional layoffs were averted by transferring some employees to the city’s proprietary departments such as the Port of Los Angeles, Department of Water and Power, and Los Angeles World Airports. Those three entities have separate budgets that are not impacted by fluctuations in the city’s General Fund.
City Administrative Officer Matt Szabo reiterated that there is no longer a $1 billion deficit. He said the gap was closed when the mayor and City Council approved the 2025-26 budget.
“The challenge that we had up to today was how do we implement the budget, and implement the reductions without triggering the layoffs and the service reductions that those layoffs would cost as it relates to this current fiscal year,” Szabo said.
Szabo said his office and other teams are monitoring revenues, expenditures, and liabilities. He is expected to provide a report on the condition of the current year’s budget in October.
“We are certainly concerned about revenues. We’re very concerned about the impact of tariffs on our local economy and so we’ll be providing updates over the course of the year,” Szabo said.
“But as of now, the billion-dollar deficit was closed, and as this budget is implemented, we are projecting structural balance in the following fiscal year, along with surpluses in years three and four,” he added.
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