Saturday, December 01, 2012

Corporate-oriented Mayor of Detroit Calls for Layoffs in Memo

December 1, 2012 at 1:00 am

Bing calls for layoffs in memo

Mayor cites 'cash crisis,' says reductions to happen starting in February in every dept.

By Leonard N. Fleming
The Detroit News

Detroit — In addition to planned furloughs, Mayor Dave Bing is calling for employee layoffs to start in February 2013 as part of a cost-reduction strategy to keep the city from running out of cash.

In a memo sent Thursday to city department and agency heads and obtained by The Detroit News, the mayor said the city's "deteriorating cash position requires that I take additional actions to ensure on-going fiscal stability." In his "cash crisis update," Bing said he directed his executive team to begin the process of layoffs and furloughs.

"Positions will be eliminated from every department and at every level, with the exception of uniform personnel assigned to field operations," the mayor wrote. "Every effort will be taken to minimize workforce reduction in revenue-generating departments."

In the memo, the mayor said that after required bargaining with the city's unions, furloughs need to be implemented for non-public-safety employees, effective in January.

The furloughs will be standardized across the city and will and occur on Mondays or the first business day of the week, Bing wrote. The mayor said he will soon direct his labor relations director to contact labor leaders to bargain over furloughs.

The city may run out of money in December due to a dispute with the state over $30 million in needed bond revenue.

Gov. Rick Snyder's administration has demanded that Detroit meet specific reforms as part of a "milestone agreement" to claim the bonds, which are now being held in escrow. One of the stipulations is the hiring of the Miller Canfield law firm, which some City Council members have opposed.

Al Garrett, president of AFSCME Council 25, the city's largest union, said the unions have offered more than $100 million in concessions that were never implemented. That would have helped eliminated the cash crunch, he said.

"Each time they reduce employees, they're also reducing services," Garrett said. "The workers have done enough. At some point you're at the breaking point. Should you go to work or stay home."

Meanwhile, Bing's office said Friday it will ask the city council to amend the city's budget to fix a $29 million shortfall in pension obligations.

Because the city under-budgeted in the previous fiscal year by $29 million, an auditing firm wants the city to agree to a repayment plan that includes reconciling the budget with the financial statement it files at the end of the year.

The changes will allow the city to prepare its Comprehensive Annual Financial Report by Dec. 31 to be eligible for state revenue-sharing, mayoral spokesman Anthony Neely said Friday.

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From The Detroit News:

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