Thread: CA. Cities Have Problems Too

Sacramento sends layoff notices to 168 employees

By Ryan Lillis
rlillis@sacbee.com
Published: Tuesday, Jun. 2, 2009 - 3:58 pm

The city of Sacramento sent layoff notices to 168 employees today, although the actual number of workers who face losing their jobs could be far less.

The employees who received the letter includes roughly 38 firefighters. However, the fire union has a tentative agreement with the city on salary freezes that would avoid those layoffs.

June 19 would be the final day for those city workers who do lose their jobs.

City officials said if other labor unions agree to salary concessions, the number of workers who will lose their jobs could dip below 100.

http://www.sacbee.com/topstories/story/1913400.html

Unions, local governments split on bankruptcy bill

By Loretta Kalb
lkalb@sacbee.com
Published: Tuesday, Jun. 2, 2009 - 12:00 am | Page 1A

What started as a municipal bankruptcy in the city of Vallejo has morphed into an all-out fight between California's local governments and unions over the sanctity of labor contracts vs. the autonomy of cities and counties.

Next battle zone: the floor of the state Assembly, where legislation requiring local governments to get state approval to file for bankruptcy protection is headed for a vote later this week.

This won't be the last imbroglio spawned by the state's fiscal turmoil. But it is likely to be among the hottest.

The bill by Assemblyman Tony Mendoza, D-Artesia, is sponsored by the California Professional Firefighters and supported by nearly three dozen labor organizations in the state and AARP – groups worried about labor contracts or pensions potentially being affected by bankruptcy filings.

The legislation, AB 155, would require local governments to get approval from the California Debt and Investment Advisory Commission before filing. If it passes in the Assembly, it goes to the Senate.

The commission provides guidance on localities' debts and investments.

The law is intended to help protect the state's credit rating on Wall Street, said Richard Garcia, Mendoza's spokesman.

But opponents say that the move is an attempt to thwart local governments, which may have to resort to seeking bankruptcy protection. They contend state oversight would inject state politics into what should be a local issue.

"Every city is in trouble," said Marc A. Levinson, the lead insolvency lawyer on the Orrick Herrington & Sutcliffe team handling Vallejo's bankruptcy filing.

"Nobody wants to go through bankruptcy. I counseled Vallejo to stay out of bankruptcy. But if you can't pay your bills, what do you do?"

Strongly opposing the bill are the League of California Cities and the California State Association of Counties.

Cities and counties rarely enter into bankruptcy, they say. And with all the state's fiscal dissonance, the idea that the state should tell local governments when it's OK to file is absurd.

"This isn't an easy process. It's a rigorous examination of your financial conditions done by a competent bankruptcy judge who can make a determination as to whether you're solvent or insolvent," said Dwight Stenbakken, the League of California Cities' deputy executive director. "This isn't something that a city does on a whim."

The legislation would not affect Vallejo's May 2008 filing. But since Vallejo went forward, the economy has worsened. And more cities and counties are flirting with financial insolvency.

That's just what worries the California Professional Firefighters.

When Gov. Arnold Schwarzenegger declared last month that the state planned to borrow $2 billion in property taxes from local jurisdictions, cities began declaring that were in a "state of fiscal crisis." It was a symbolic gesture aimed at discouraging the borrowing.

Labor groups took it to heart.

The fiscal crisis "raised alarm bells," said Carroll Wills, spokesman for the California Professional Firefighters.

"Municipalities up and down the state have either spoken publicly about bankruptcy or have contacted the bankruptcy attorney representative for Vallejo," Wills said.

But the issue goes well beyond Vallejo, he said.

"There's a central issue of the sanctity of the negotiated (labor) contract at stake," he said.

"Some of our local affiliates have been given this back-channel nudge (from management): 'If you guys don't respond (and make contract concessions), we're going to pull a Vallejo,' " Wills said.

Wills disputed the idea that the state shouldn't get involved in local filings or that it would inject intense state politics in the process.

"Local politicians and bureaucrats have no special wisdom on fiscal matters," he said.

"It's disingenuous for anyone to suggest that the state process would be any more political than a local process," he said. "Look at Vallejo. It has been the hottest political issue imaginable in that jurisdiction."

California is one of a dozen states nationally that have no state constraints on federal bankruptcy filings.

If the bill becomes law, California will join 16 other states that face some level of bankruptcy filing oversight. Another 22 states don't allow localities to file for bankruptcy protection, Wills said.

Jean Hurst of the California State Association of Counties called AB 155 one of the "priority measures to defeat," particularly in light of the seriousness of the state's budget crisis.

"When we look at this measure in the context of the fiscal environment, it's absolutely unworkable," she said. "We don't agree that it's an appropriate limitation of local government's ability to manage its finances."

--------------------------------------------------------------------------Call The Bee's Loretta Kalb, (916) 321-1073.

http://www.sacbee.com/topstories/story/1910410.html

School lunch prices, classroom sizes going up

School district trustees make $30 million worth of cuts

By Maureen Magee, Union-Tribune Staff Writer, David Ogul, Union-Tribune Staff Writer
3:47 p.m. June 2, 2009

SAN DIEGO – School lunch prices will be going up and more children will be squeezed into classrooms as the San Diego school board on Tuesday agreed to tens of millions of dollars in cuts to a budget with a projected $106.7 million deficit.

The board, however, opted against a controversial proposal to shut down Adams, Cadman, Paradise Hills, Rolando Park and Sequoia elementary schools. The closures would have saved more than $2 million.

It also voted to spare the popular weeklong Old Town, Balboa Park and Mount Palomar programs for fourth-, fifth- and sixth-graders.

Among cuts the board approved on Tuesday were boosting class sizes in kindergarten through third grade to 24 students, saving the district about $17 million; eliminating a program that reduced ninth-grade class sizes, saving nearly $4 million; implementing cuts in the district's Seminar program for gifted students, saving about $1 million; and raising lunch prices by 25 cents, bringing in an additional $625,000.

By midday, trustees had made cutbacks projected to save $30 million.
Board members got a bit of good news before Tuesday's session when an updated analysis showed that the district's projected deficit would be about $75 million less than was projected just a week ago. Some of that savings – about $13 million – came from hiring and spending freezes implemented earlier this year.

Before trustees took up the cost-cutting measures, a parade of students, teachers and community members pleaded with the board to spare such things as music education, high school athletics and the Off-Campus Integrated Learning Experiences program – known as OCILE to parents, teachers and students – that takes children on weeklong field trips.

Superintendent Terry Grier said no tenured teachers will get pink slips. While the cuts he has offered to the board eliminate 640 teaching jobs, the district has cleared out more than 1,200 teachers through retirements, leaves of absence and the dismissal of 444 temporary instructors.

At previous meetings, the board had agreed to more than $43 million in cutbacks.
A budget must be adopted by June 30.

Maureen Magee: (619) 293-1369;
David Ogul: (619) 293-2517;

http://www3.signonsandiego.com/stories/ ... ool-board/

School Lunch Prices Going Up but only for those who have to pay for lunch...Come on, you know who you are. You're the tax paying LEGAL citizens of California!