Monterey officials have asked city employees to take furlough days as part of a plan to close a $3.1 million budget gap.

City Manager Fred Meurer has agreed to take six furlough days before the end of the fiscal year (June 30), and other executive managers have agreed to five furlough days. City leaders are asking all other employees—including police and fire—to take the four furlough days, but they haven’t yet reached agreements.

The furloughs equal about a 4.6 percent pay cut per city employee, Finance Director Don Rhoads told the city council at the Feb. 25 mid-year budget review. Finance staff hope the city can save $636,000 by reaching furlough agreements with employees. If the labor unions don’t agree to some type of concessions, the city will likely start laying off workers.

"If we’re unable to get the type of assistance we’ve asked for,” Human Resources Director Ralph Bailey told the city council, “we will have to accelerate the pace of layoffs. That’s where we’re at.”

At the Feb. 25 meeting, the City Council unanimously agreed to take a series of actions to balance the budget including: freezing capital projects that are not essential to public safety or health ($1.3 million); freezing 26 vacant positions ($770,000); reducing the set-aside for the reserve fund ($400,000); and seeking employee concessions—like furloughs—that finance staff hope will save the city an additional $636,000 this fiscal year. Combined, all four measures will allow Monterey to end the year in the black.

Next year, however, looks worse: “A $5.85 million deficit if nothing changes,” Rhoads said. To address the 2009-10 shortfall, departments have been asked to prepare budget reductions for in anticipation of 5-20 percent cuts. Monterey city leaders will begin to review the different budget scenarios at a public meeting March 12. Read the latest Monterey city budget news here.