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Top LA city official says $1 billion budget deficit could lead to thousands of layoffs

Craig Nigrelli, Reporter
This recording was made using enhanced software.

Full story

  • The city of Los Angeles is looking at a massive $1 billion budget deficit in the upcoming fiscal year. The result will likely be thousands of layoffs, according to a top city official.
  • The costs associated with the devastating wildfires this year are among the reasons for the revenue shortfall.
  • Mayor Karen Bass will deliver the budget, with the steep cuts included, in late April.

Full Story

The city of Los Angeles is facing a $1 billion budget gap for fiscal year 2025-26 that will require massive cuts. The city’s top financial adviser delivered the outlook on Wednesday, March 19.

City Administrative Officer Matthew Szabo said the city is looking at thousands of layoffs, not hundreds. He added that layoffs will not be the only solution.

What are some of the contributing factors to the large deficit?

The large budget deficit is reportedly a result of lower than anticipated tax revenue, increased liability or legal payouts, and money for waste fees and funds needed to cover Los Angeles police and firefighter pensions.

Szabo said the city’s rising liability payouts pretty much tripled in the past year, from $112 million to $320 million. The city is now working with the California Legislature on a bill to possibly cap damages.

Pay raises for city workers are set to kick in on July 1, adding $250 million in costs. The City Council is now discussing various contracts and possible concessions with unions representing public employees, including police, firefighters, garbage truck drivers and librarians.

Mayor Karen Bass, D, issued a statement saying that her upcoming budget will make the best use of their scarce dollars. However, she warned of fundamental changes in the way the city operates. She urged the chief administrative officer to report to her with plans to reduce spending while protecting essential services.

What’s next?

Projections show that revenue will fall hundreds of millions of dollars short due to trade, immigration policies and the impact of this year’s devastating wildfires.

Mayor Bass will deliver her budget, detailing the steep cuts on April 21.

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Bias comparison

  • Media outlets on the left framed Los Angeles' $1 billion budget deficit by emphasizing its potential "impact" on Angelenos and the "inevitable" layoffs, highlighting the human cost and potentially increased trash rates, reflecting a concern for the working class.
  • Not enough coverage from media outlets in the center to provide a bias comparison.
  • Media outlets on the right acknowledged the "staggering budget deficit" and "inevitable" layoffs, but put a "positive spin" on Mayor Bass's response, suggesting she was downplaying the severity, and underscored the city council's vote to become a "sanctuary city," implying a connection between this decision and the budget crisis.

Report an issue with this comparison

Media landscape

Click on bars to see headlines

14 total sources

Key points from the Left

  • Los Angeles faces a budget shortfall of nearly $1 billion for the 2024-2025 fiscal year, making layoffs "nearly inevitable," according to City Administrative Officer Matt Szabo.
  • Mayor Karen Bass must present a strategy to address the budget gap by April 21, emphasizing the need for substantial changes to city operations.
  • City Controller Kenneth Mejia warned that anticipated revenues will fall well below projections, affecting city programs.
  • Rising costs, including pay raises and legal payouts, are contributing to the city's financial problems.

Report an issue with this summary

Key points from the Center

  • Los Angeles faces a projected $1 billion budget shortfall for fiscal year 2025-26, according to City Administrative Officer Matt Szabo, requiring tough financial decisions and potential layoffs.
  • Szabo highlighted a $61 million starting gap impacted by $315 million in lower tax revenue and rising costs, including $100 million in liability payouts and $275 million to restore the reserve fund.
  • Mayor Karen Bass emphasized the need for fundamental change in the way the city operates in her preview of the upcoming budget proposal.

Report an issue with this summary

Key points from the Right

  • The City of Los Angeles is facing a nearly $1 billion budget shortfall for the fiscal year 2025-26, according to City Administrative Officer Matt Szabo.
  • Matt Szabo warned that this budget crisis may lead to layoffs of thousands of municipal employees, which he described as nearly inevitable.
  • Mayor Karen Bass emphasized the necessity of making fundamental changes to the city's operations and budget amid declining revenues.
  • The budget crisis is attributed to factors like increased legal payouts, weaker-than-expected tax revenues, and costs from recent wildfires, impacting the preparation for the 2028 Olympics.

Report an issue with this summary

Other (sources without bias rating):

Powered by Ground News™
This recording was made using enhanced software.

Full story

  • The city of Los Angeles is looking at a massive $1 billion budget deficit in the upcoming fiscal year. The result will likely be thousands of layoffs, according to a top city official.
  • The costs associated with the devastating wildfires this year are among the reasons for the revenue shortfall.
  • Mayor Karen Bass will deliver the budget, with the steep cuts included, in late April.

Full Story

The city of Los Angeles is facing a $1 billion budget gap for fiscal year 2025-26 that will require massive cuts. The city’s top financial adviser delivered the outlook on Wednesday, March 19.

City Administrative Officer Matthew Szabo said the city is looking at thousands of layoffs, not hundreds. He added that layoffs will not be the only solution.

What are some of the contributing factors to the large deficit?

The large budget deficit is reportedly a result of lower than anticipated tax revenue, increased liability or legal payouts, and money for waste fees and funds needed to cover Los Angeles police and firefighter pensions.

Szabo said the city’s rising liability payouts pretty much tripled in the past year, from $112 million to $320 million. The city is now working with the California Legislature on a bill to possibly cap damages.

Pay raises for city workers are set to kick in on July 1, adding $250 million in costs. The City Council is now discussing various contracts and possible concessions with unions representing public employees, including police, firefighters, garbage truck drivers and librarians.

Mayor Karen Bass, D, issued a statement saying that her upcoming budget will make the best use of their scarce dollars. However, she warned of fundamental changes in the way the city operates. She urged the chief administrative officer to report to her with plans to reduce spending while protecting essential services.

What’s next?

Projections show that revenue will fall hundreds of millions of dollars short due to trade, immigration policies and the impact of this year’s devastating wildfires.

Mayor Bass will deliver her budget, detailing the steep cuts on April 21.

Related Stories

Tags: , , , , , , ,
Read Transcript

Bias comparison

  • Media outlets on the left framed Los Angeles' $1 billion budget deficit by emphasizing its potential "impact" on Angelenos and the "inevitable" layoffs, highlighting the human cost and potentially increased trash rates, reflecting a concern for the working class.
  • Not enough coverage from media outlets in the center to provide a bias comparison.
  • Media outlets on the right acknowledged the "staggering budget deficit" and "inevitable" layoffs, but put a "positive spin" on Mayor Bass's response, suggesting she was downplaying the severity, and underscored the city council's vote to become a "sanctuary city," implying a connection between this decision and the budget crisis.

Report an issue with this comparison

Media landscape

Click on bars to see headlines

14 total sources

Key points from the Left

  • Los Angeles faces a budget shortfall of nearly $1 billion for the 2024-2025 fiscal year, making layoffs "nearly inevitable," according to City Administrative Officer Matt Szabo.
  • Mayor Karen Bass must present a strategy to address the budget gap by April 21, emphasizing the need for substantial changes to city operations.
  • City Controller Kenneth Mejia warned that anticipated revenues will fall well below projections, affecting city programs.
  • Rising costs, including pay raises and legal payouts, are contributing to the city's financial problems.

Report an issue with this summary

Key points from the Center

  • Los Angeles faces a projected $1 billion budget shortfall for fiscal year 2025-26, according to City Administrative Officer Matt Szabo, requiring tough financial decisions and potential layoffs.
  • Szabo highlighted a $61 million starting gap impacted by $315 million in lower tax revenue and rising costs, including $100 million in liability payouts and $275 million to restore the reserve fund.
  • Mayor Karen Bass emphasized the need for fundamental change in the way the city operates in her preview of the upcoming budget proposal.

Report an issue with this summary

Key points from the Right

  • The City of Los Angeles is facing a nearly $1 billion budget shortfall for the fiscal year 2025-26, according to City Administrative Officer Matt Szabo.
  • Matt Szabo warned that this budget crisis may lead to layoffs of thousands of municipal employees, which he described as nearly inevitable.
  • Mayor Karen Bass emphasized the necessity of making fundamental changes to the city's operations and budget amid declining revenues.
  • The budget crisis is attributed to factors like increased legal payouts, weaker-than-expected tax revenues, and costs from recent wildfires, impacting the preparation for the 2028 Olympics.

Report an issue with this summary

Other (sources without bias rating):

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