Facing a historic budget shortfall of nearly $1 billion, Los Angeles Mayor Karen Bass on Monday proposed deep cuts to the city’s workforce and services to stabilize municipal finances in the wake of mounting challenges, including January’s devastating Palisades Fire and looming federal funding reductions.
Bass’ proposed budget for the 2025-26 fiscal year calls for $14 billion in spending but trends toward austerity with a 5% reduction in the city’s workforce, totaling 1,647 job cuts.
In her State of the City address delivered at City Hall, Bass underscored the economic stress faced by Los Angeles due to soaring liability payments, diminished tax revenue and unanticipated fire recovery costs.
“Turmoil and uncertainty from Washington, and a slowing economy, are causing lower revenue projections to the tune of hundreds of millions of dollars,” Bass said during her address Monday. “Combined with personnel costs and, of course, the fires and rebuilding, altogether Los Angeles, we have a very difficult budget to balance.”
The job cuts will span various departments, affecting essential services citywide, including those under the Economic and Workforce Development Department. The proposal renders numerous positions obsolete, predominantly targeting roles that remain unfilled.
Most of the layoffs would be among civilian employees of the police department, with over 400 proposed job cuts. Triple-digit staff reductions would also hit the Transportation, Sanitation, Street Services, Planning and General Services departments.
“We’re always glad to have a conversation about how to make things more efficient in the city of LA, but that shouldn’t include laying off the folks doing the work,” said David Green, president of SEIU 721, the largest union of public employees in Southern California representing tree trimmers, sanitation workers and trash truck drivers and other workers.
“I’m going to push back and fight against every single one of these layoffs,” he told Politico.
Stuart Waldman, president of the Valley Industry and Commerce Association, a San Fernando Valley business group, faulted LA officials for mismanaging the city’s finances, saying they have been too generous when negotiating workforce salaries.
“They did it to themselves,” he told the Los Angeles Times. “The city entered into a bad deal with city employees to give them massive raises, and now it’s coming back to bite us.”
To help generate more revenue, the City Council approved a steep increase in trash collection fees — 54% for single-family residences and 130% for multifamily properties.
Meanwhile, Bass expressed hopes for state assistance from Gov. Gavin Newsom and the Legislature to help alleviate financial strains.
The mayor touted a 10% reduction in street homelessness and a 14% decrease in homicides, which she said are indicators of the city’s capacity for resilience. She said the “fast pace” of recovery from the Palisades Fire, in her view, stands as a testament to the city’s ability to rebound from disaster.
Councilwoman Traci Park, whose district includes Pacific Palisades, has backed measures to streamline rebuilding via waivers for building permit fees, a motion awaiting evaluation for feasibility. Bass praised the rapid restoration of utilities in fire-impacted areas.
“We know the faster we can rebuild, the faster we can heal,” Bass said.
However, the fiscal hurdles remain formidable with further cuts likely as revenue sources, including business and property taxes, continue to dwindle amid economic uncertainty. Unanticipated expenditures, such as legal settlement payouts, have exacerbated the financial burden, peaking liability costs to $300 million this year — a threefold increase compared with annual norms.
In crafting her budget, Bass avoided reducing police force numbers, but the Los Angeles Police Department anticipates finishing the current fiscal year with a slight reduction in its ranks to 8,733 sworn officers. The mayor’s plan projects the LAPD will finish fiscal year 2025-26 with 8,639 officers.
The proposed budget calls for the LA Fire Department to receive a 12.7% increase. The plan adds 277 new positions and calls for more paramedics, mechanics and fast response vehicles equipped to respond to an increasing number of calls for help from people experiencing homelessness.
Bass is also proposing to eliminate the Health and Climate Emergency Mobilization committees, while consolidating the departments of aging, economic and workforce development and youth development into one agency. The proposed budget also combines the Commission for Community and Family Services with the Community Action Agency board and the Affordable Housing Commission with the Rent Adjustment Commission.
As the city gets set to host the 2028 Summer Olympics, Bass emphasized the need for a citywide transformation and concluded her address with a hopeful tone amid the looming challenges. Reflecting on LA’s resilience, she affirmed the city’s commitment to overcoming its current trials and preparing for a brighter future symbolized by the Olympics.
“So, LA — let’s go win,” Bass said. “Let’s win on the world stage, yes — but let’s especially win here at home.”
The City Council has until June 1 to consider and approve a 2025-26 spending plan.
