City Commissioner Randy Leonard has scheduled a meeting with Bureau of Development Services employees tomorrow morning to explain why he's laying off up to 48 of them at short notice on July 31, with two further rounds of layoffs coming down the pipe, the Mercury has learned. We sent an email to Leonard at 3:29 seeking a confirmation or denial, and he's yet to respond. But Leonard sent the following email to BDS staff at 3:45:
Dear BDS Employees,
As you are all aware, the Bureau is facing a worsening financial condition as a result of a steep and sustained decline in construction activity. Recently, the revenue returns for March, April, and May did not yield the seasonal increase that we had anticipated, and as a result, we are drawing on our reserves at an unacceptable and unsustainable rate. With no evidence in the current economic climate to suggest an increase in construction activity, we are being forced to implement immediate cost saving measures that will include a large number of layoffs.
Beginning last year when our revenues first began declining, Bureau management took immediate steps to reduce expenses. Since that time, the bureau has reduced its workforce by more than 52 positions, cut its materials and services budget dramatically, and pioneered a unique approach in the City by offering the services of its professional employees for the design of the City’s Emergency Communications Center. That combination of efforts reduced the bureau’s expenses by approximately $5.5 million on an annual basis, and the bureau was planning 37 more position cuts over the next 6 months to complete the alignment of revenues with expenses.
In January, an option we discussed was to lay off 45 employees, but my direction to Paul up to last week was to vigorously pursue these cost savings without resorting to layoffs. Since late last year, the bureau has been subsidizing its personnel expenses using its reserves, and our projections indicated that the cost savings coupled with modest improvements in construction activity would be enough to sustain the bureau through a deliberate reduction of positions in the bureau over a 15 month period.
Unfortunately, the bureau’s spring revenues have been dismal, and the most recent revenue reports require a significant downward adjustment to our revenue projections. As a result, we are forced to take immediate cost savings measures and, with much regret, abandon our previous approach.
Beginning July 1, all non-represented employees, including managers and myself will take two week unpaid furloughs in fiscal year 2009-10, and I have requested that DCTU employees and COPPEA employees also accept a two week unpaid furlough in fiscal year 2009-10 as well. If all employees accept a two week unpaid furlough, on July 31 the bureau will lay off 45 employees, on August 31, the bureau will lay off an additional 45 employees, and if conditions do not improve, the bureau will lay off an additional 45 employees on December 31. If represented employees do not accept a furlough, 48 employees will be laid off on each of the three dates listed above.
These cuts are severe, and our arrival at this decision is painful, but the financial realities we face must be addressed. We have made a strong effort to avoid layoffs for the past 8 months, but the severity of this economic downturn has bested our every effort to avoid this day
Your managers and I and my staff have been meeting with affected staff over the past two days and we are available to answer any questions any employee may have. I will be meeting with impacted staff on Wednesday June 17, and Paul will be hosting the next "Chat with the Director" on Tuesday, June 30. You may also contact your supervisor, Paul or myself directly via email with specific questions.
I am deeply saddened to have to send you this bad news. I am proud of each and every one of you and I will do whatever I can to return those employees who are being laid off as quickly as I can.
Do not hesitate to contact me directly if you would like to discuss this further.
"I'm in complete disbelief," said one BDS employee on the phone with the Mercury, earlier today. "There was no talk of this at all when they crafted the budget."
The meeting with Leonard is scheduled for 8am tomorrow at the Portland Building.