The Observation Deck

As many as 50 Lakewood city employees -- including firefighters and Division of Aging workers -- could be laid off to offset a projected $3.2 million deficit, Mayor Edward FitzGerald said Wednesday.

FitzGerald, who became mayor last month, said the city's money woes have been at least a decade in the making. Costs, particularly employee health costs, have escalated while revenues have remained stagnant. Over the years, surplus funds have been depleted to make up the shortfall.

"The writing was on the wall . . . that we were going to hit the wall. There is no more money squirreled away anywhere," the mayor said during a meeting with the Plain Dealer editorial board.

The mayor said he hopes to reduce the number of layoffs by asking the city's unions for wage and benefit concessions. Almost all of the 524 full-time employees are covered by a union contract.

Capt. Dave Dargay, president of the firefighters union, said the union is willing to meet with the mayor. He added, "Any cuts would impact the service level."

Last year then-Mayor Tom George negotiated contracts with five unions. Employees received a 7 percent wage increase over three years.

"The contracts were not excessively generous, but they were in excess of what we could afford," FitzGerald said.

George said during his campaign last year that the city's finances were in good shape. He could not be reached for comment Wednesday.

Council President Michael Dever said council is ready to move forward with the mayor's plan. A budget must be approved by March 31.

FitzGerald also wants to transfer to existing social service agencies some services for senior citizens that are provided by the city and funded by the county.

The one department that will be unaffected by personnel cuts is the Police Department. Next month the mayor will unveil a law enforcement initiative targeting crimes, such as residential break-ins, which have been on the rise.

The city also is acquiring a dozen properties in foreclosure to help spur development projects such as office buildings.

Bill Call wrote:I think the City now has a strong Mayor and City Council willing to take bold action to right a listing ship. We are lucky to have them. Hopefully, the people who actually live in the City will give them the support and respect they deserve.

Jim O'Bryan wrote:I too commend the mayor and council for being quick, decisive, and entirely open on this process.

Mayor FitzGerald is looking to fix a city not build a legacy.

Bill Call wrote: Riddle: Why does it take $1.5 million in overtime to fight 144 fires?

Will Brown wrote: Now we have a new major, who was head of city counsel (if I recall) who seems to feel that it was George who got us in this mess, and hopes we won't remember his part in it. Some things never change.

Rick Uldricks wrote:

http://www.lkwdpl.org/city/council.htm

http://www.lkwdpl.org/city/mayor.htm

I'm sure most of you have read recent media reports regarding our fiscal situation. I thought it might be helpful if you heard from me directly.

For the last several years, multi-million dollar deficits were projected for 2008. Along with other Councilmembers, I began advocating for taking strong action years ago on our looming deficit, not because I wanted to but because I feared that if we delayed, the situation would only get worse. Unfortunately, it has.

In December, at my suggestion, the City of Lakewood began discussions with the State Auditor's office regarding an emergency audit of our budget and operations. The first phase of that analysis is now complete, and the Auditors confirmed that our initial projections of a deficit in excess of $4 million in our general fund was accurate within 1.9%. It was important to arrive at an unbiased estimate of our deficit so that we could begin budget negotiations on common ground.

I have had direct, informal discussions with the bargaining units. In those discussions, I promised them that I would make all of our fiscal information available to them, and that I would seek to negotiate in good faith with them and not make any final decisions regarding layoffs until we had a chance to formally negotiate. I have kept that promise, and we will make no decisions on layoffs until negotiations or re-negotiations are complete.

Due to the magnitude of our deficit, I have instructed all directors to present options for reductions of both services and personnel. Many of those options, which include layoffs and outsourcing strategies, will probably not be implemented, depending on the outcome of labor negotiations. But I believe that the public expects us to exhaustively research all our options and strategies. No one should assume that because an option is being discussed or researched, it is a "done deal." We're simply putting all options on the table.

Of course, I cannot control media reports on this subject, so please take them with a grain of salt. I know that news reports will increase the anxiety of employees who are uncertain about their future employment. I wish I could be more definitive about the outcome of this process, but at this point all I can say is that the deficit is significant and some layoffs are likely. It is also my firm position that even in these difficult financial times, we must make some additional investments in the areas of public safety, technology and the foreclosure crisis. The timing of all of these simultaneous crises couldn't be worse, but those are the cards I have been dealt.

It's also important to note that even before negotiations have begun, we have unilaterally made many decisions to save money immediately. Approximately $2.5 million has been cut from the budget, primarily by not replacing vacant positions. Also, we are altering the health care benefits for non-bargaining unit employees, which also affects directors and myself personally. I apologize for not giving these affected employees more notice, but time is of the essence. Despite these cost saving measures, we still have a long way to go to balance the budget.

City of Lakewood employees do excellent work, and my preference would be to keep every one of them. Unfortunately, it has fallen to us to make unpopular decisions by March 31st. My hope is that we will come out of this process on firm financial ground and ready to make progress against all our challenges. Trying to avoid these decisions is just not an option- a bankrupt city does not provide any services at all, and the stakes are really that high.

I'm sorry that I couldn't be introduced to many of you under happier circumstances. We are working as hard as we can to resolve this situation, and I will continue to do that until we succeed. Your patience and support would be appreciated. Please feel free to circulate this memo to any employees who do not have access to email.

ed fitzgerald