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December 21, 2014

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Housing construction drop costs 30 jobs at LV City Hall

Thirty employees at Las Vegas City Hall are going to lose their jobs next month, because of the drop in new home construction.

In addition, an unspecified number of hourly employees will lose jobs and the city will close some senior centers and city-operated pools on Sundays.

City Manager Doug Selby and Finance Director Mark Vincent this afternoon blamed the cuts on a decrease in building permit revenue—36 percent in the last two years—which has led to a budget imbalance: operating costs current exceed revenues by $5.7 million.

On April 12 the city will cut 30 jobs in the department, mostly inspectors, and will not refill one position already vacated. That will save about $4.2 million. Vincent said expenses in that department will still exceed revenues by about $2 million per year.

The lay-offs will bring the number of employees in the Building Department to about 100. By comparison, there were 110 employees in 2000.

Housing inspector jobs are funded through fees collected on permits, which go into the so-called Enterprise Fund. That fund will have fallen from roughly $19 million in fiscal 2007 to $3.5 million in fiscal 2008.

Selby doesn’t expect any more dramatic cuts from its 3,000-person workforce in fiscal 2008, which begins July 1, 2008, because the city has already planned for a 4.5 percent reduction in its $555 million general fund budget. Much of that reduction will be covered by not filling positions vacated by retirement.

The cuts won’t end this year.  Armed with charts showing jagged, steep drop-offs, Vincent and Selby said the city expects another 3 percent budget cut in fiscal 2009.

The city’s budget experience is not unlike what is happening all over the country. Comparatively, however, Las Vegas seems to be getting off easily.

Vallejo, Calif., for instance, only avoided filing for Chapter 9 bankruptcy last month by securing a new salary deal with unionized police officers and firefighters. Hit by the same housing decline as Las Vegas, Vallejo, a San Francisco suburb of about 120,000, has one of the highest foreclosure rates in the country.

Phoenix, meanwhile, is looking at cutting some 500 employees to make up for a $67 million revenue shortfall.

“But we’re not sure we’ve hit the bottom yet,” Vincent said, referring to fiscal 2008 and ‘09. “We’d like to think we’ve hit the bottom, but we’re not sure we have. I believe it’s an economic cycle. The question is how long will it be and how deep will it go?”

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