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Las Vegas to lay off 19 city employees as part of budget cuts

City manager says 74 positions have been cut, with most of them already vacant

Updated Wednesday, Nov. 18, 2009 | 9:27 p.m.

Seventeen full-time and two part-time employees of the city of Las Vegas will be notified in the next couple of days that they're out — they no longer have jobs with the city as of Jan. 29.

That's the most drastic of actions being taken by the city to deal with an expected budget shortfall of about $430 million during the next five years, City Manager Betsy Fretwell told the Las Vegas City Council this evening.

The council members unanimously accepted her report following a nearly two-hour session where they heard an economic forecast about how the recession is and will affect Southern Nevada and how the city finances have been affected.

After the meeting, Fretwell told reporters she could not divulge yet which employees' jobs have been eliminated, because they haven't been told yet.

But she said the jobs cut across most city departments and were part of a decision to eliminate 74 positions — some 54 of which are already vacant.

Fretwell, who didn't rule out that more employee job cuts might be needed after January, said today's action was part of a plan to immediately reduce the current fiscal year budget by nearly $7.8 million.

The cuts are needed because of a continued decline in consolidated tax revenue, which is resulting from the recession.

Other actions approved by the city council are:

-- Freezing all vacant positions, including public safety positions, such as police and firefighters, until next March.

-- Delaying all construction projects that are paid for from the city's general fund that have not yet been contracted for design or construction. The construction freeze does not include the new city hall project, which does not affect the this year's budget, nor the next two fiscal years' budgets.

-- Freezing all travel and employee development expenses unless it is business related, locally provided and needed for certifications. Travel paid for by grants is not affected.

-- Dropping the top range of the executive pay scale by 5 percent, which would save $640,000.

Southern Nevada lagging nation in economic recovery

Before taking action, the council heard some background on Southern Nevada's economy from John Restrepo, a Las Vegas-based economist who runs Restrepo Consulting Group.

Restrepo showed numerous charts and graphs that indicated the Las Vegas area was lagging behind the rest of the country in coming out of the recession.

For example, while the U.S. unemployment rate is 9.8 percent, Clark County's jobless numbers are 13.9 percent. And they're actually closer to 20 percent when you take into account people who are working either part-time jobs or jobs they don't really want, he said.

One of the telling figures he had was for foreclosures. In the U.S., foreclosure filings were up 22.5 percent comparing the third quarter of 2008 to the third quarter of 2009, he said. In Nevada, they were up 59 percent and in Las Vegas, thery were up 54 percent.

Foreclosures amounted to .73 of a percent, or one in 136 households nationwide, compared to 4.4 percent or one of 23 households in Nevada and 5 percent, or one in every 20 households in Las Vegas, he said.

The council also heard a report by Mark Vincent, the city's chief financial officer.

Vincent said that while construction had amounted to 12 percent to 15 percent of the local economy, after the CityCenter is complete next month, commercial construction is all but gone in the city.

Vincent also predicted that commercial foreclosures are on the way, which will mean a 50 percent decline in commercial assessed value, which will affect property tax revenue.

Also, the recovery of gaming and tourism is dependent upon the changes in traveler's spending habits, he said.

Vincent said that back in May, city officials had expected they would see $218 million reduction in total revenue for a five-year period. But their latest projections now show it's going to be a deficit of $30 million.

He said the immediate structural deficit for the 2011 fiscal year is $69 million. A budget cut of about $60 million would be needed to realign expenditures with revenues, he said.

Focus groups, town hall meetings to help with cuts

Fretwell said actions to deal with the budget deficit have included requesting city departments each come up with 12 percent budget reductions.

The city has also surveyed the community to find out what kinds of roles they want government to play.

As part of that effort, the city is also conducting interviews with focus groups to refine the survey data, she said.

She said the next steps will be to review the city council priorities on Dec. 16, to have a Jan. 7 retreat to review the city's fundamental services and to have a tentative budget hearing on March 10.

A series of town hall meetings to discuss the budget with Mayor Oscar Goodman and the city council member from that area has also been scheduled as follows:

- Jan. 11, Ward 4: Summerlin Library and Performing Arts Center.

- Jan. 19, Ward 5: City Council chambers

- Jan. 25, Ward 4: YMCA Durango Hills

- Jan. 27, Ward 3: East Las Vegas Community Center.

- Feb. 9, Ward 6: Centennial Hills Community Center.

- Feb. 16, Ward 2: Veterans Memorial.

- Feb. 18, Ward 6: Northwest Career and Technical Academy.

- Feb. 22, Ward 3: Minker Sports Center Gym.

- Feb. 24, Ward 5: Southern Nevada Health District.

- Feb. 26, Ward 1: YMCA Meadow Lane.

- March 1, Ward 2: Sahara West Library.

- March 4, Ward 1: Charleston Heights Arts Center.

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