Skip to main content

City Approves Management Salary Cutbacks to Reduce $6M Deficit

March 14, 2012 |
Since the beginning of the year, the City of Garden Grove has been undergoing rigorous belt-tightening to help alleviate a $6 million hole left by the loss of the City’s redevelopment agency in February. At last night’s regular City Council meeting, the Garden Grove City Council tightened yet another notch by voting 4-to-0 (Council Member Nguyen absent) on approving salary cutbacks for all management staff.

“Hard times bring hard decisions. Because we’ve been proactive rather than reactive to our situation, we’ve been successful in cutting corners without cutting labor or services, but at some point, something has to give,” says Garden Grove Mayor William J. Dalton.

The City Council passed two resolutions that approved the following:

  • Retraction of a 2-percent cost-of-living increase anticipated for July 2012.
  • Imposition of an eight-hour per month furlough. This equates to a 4.61-percent reduction in salary per employee.
  • Offered “buyouts” whereby full-time employees voluntarily resign their position in exchange for a severance.

The City Council decision affects a total of 92 non-union, management level employees.

According to the City’s Human Resources Director and City Treasurer, John D.R. Clark, the savings from the 2-percent cost of living removal and eight-hour furlough is expected to save the City an estimated $583,000 per year.

“Management realizes the difficulty Garden Grove faces, and is ready to take on the responsibility of leading by example. It’s not an easy decision, but a needed one,” says Garden Grove City Manager Matt Fertal.

The City is currently in negotiations with all of the employee unions on extending these and other cost-saving measures to the entire City labor force, including Police and Fire personnel. If approved, one measure would close City Hall and other non 24-hour City facilities during one of the two open Fridays each month.

Also being proposed is an Early Retirement Incentive or “Golden Handshake” for eligible employees that will be brought to the City Council for consideration at a later meeting.

Recently, Fertal addressed all the employees with the proposed measures, thanking the staff for their support, and ending on a positive note regarding redevelopment.

“The City has positioned itself to see its major redevelopment projects move forward to completion. Once completed, these projects will provide the financial stability Garden Grove needs to continue building a solid future,” said Fertal.