LOS ANGELES, April 7 (UPI) -- Los Angeles, facing a $222 million budget shortfall, may have to add new taxes, lay off employees and privatize some services, a budget official's report said.
Chief Administrative Officer Miguel Santana cited rising employee costs and flat revenues for the city's financial woes and said bankruptcy is possible, the Los Angeles Times reported.
The budget crunch comes despite the city's reducing its workforce by 4,900 positions in recent years, Santana said. He said the shortfall could climb to $427 million by 2014-15.
"We're always in crisis mode," Santana said. "We're always trying to close that shortfall."
Without cutting costs and generating about $150 million in new revenue, he said, "We're facing the complete devastation of city services, including public safety."
Santana said raising the city's parking tax by 10 percent-15 percent could bring in $40 million while doubling a transfer tax on property sales could increase revenue $100 million. Voters would have to approve both moves.
He also pointed to the possibility of contacting with private companies or nonprofits to handle some city services, including management of the Los Angeles Convention Center, and suggested outside laborers could take on some city services.
Santana said the city could look into having a private company, instead of the Los Angeles Fire Department, handle emergency medical transport, saying few cities provide ambulance transport by firefighters.
But Pat McOsker, president of the United Firefighters of Los Angeles City, said turning over ambulance services to private industry "would be a public health disaster."
Mayor Antonio Villaraigosa, who is to release his proposed budget for 2012-13 in a few weeks, will "advance some of the concepts discussed" in Santana's report, a spokesman said.
Villaraigosa said last week a "large number" of layoffs might be necessary.
Santana said layoffs could be avoided if employees agreed to forgo raises they had been promised for the next two fiscal years.
