Villaraigosa is negotiating voluntary retirement plan with L.A. employee unionsThe mayor says he has told the personnel department to come up with a plan for layoffs in case the city and the unions cannot reach a deal.

Hoping to avert layoffs next year, Los Angeles Mayor Antonio Villaraigosa is negotiating a voluntary retirement plan with the city's employee unions that could affect as many as several thousand workers.

In a letter Friday to City Council members outlining his plan to eliminate an $86.6-million gap in the current year's budget, Villaraigosa said he had directed the personnel department to come up with a plan for layoffs in case the city and the unions cannot reach a deal.

"I know that involuntary downsizing will be devastating for the affected individuals and the city as a whole, but I believe I have no choice," Villaraigosa wrote. "We must plan for various potential outcomes, including layoffs."

Both the mayor's office and a spokeswoman for the Coalition of L.A. City Unions -- a group representing roughly 22,000 city employees -- declined to discuss the details of their talks. In the letter, Villaraigosa said he hoped a plan could be presented to city employees in February.

"We believe it is not in our community's best interest to have more people on the unemployment line," said coalition spokeswoman Barbara Maynard. "People who are close to retirement could have the opportunity to retire now to reduce the city's payroll costs and save critical city services.

"We understand very clearly the severity of the situation and we understand the need to move as quickly as possible by protecting our members' best interests and the city's best interests."

When a similar idea was proposed last year, the city's top financial analyst expressed concern that it could add hundreds of millions of dollars to city pension obligations.

In the short term, however, Villaraigosa and council members are attempting to address this year's budget shortfall. The mayor's plan includes selling seven surplus city properties, reducing the number of Emergency Medical Services fire captains and trimming library funds. The mayor did not call for immediate layoffs or a freeze on his plan to hire more police officers.

The proposal comes just days after the council made $44 million in cuts to the current budget, spurred by lower-than-expected tax revenues amid a nationwide recession.

The drop in revenue has been accompanied by higher than expected costs due to fluctuating gasoline prices and lawsuit settlements.

In Friday's plan, the mayor avoided some of the most controversial proposals discussed in recent weeks, which had included cutting money for crossing guards, tree-trimming and paving programs.

Villaraigosa proposed borrowing $19.3 million to pay for some of the city's lawsuit settlements. He said he would recoup $6.7 million from the Police Department's overtime account and $9.5 million from the sale of the surplus properties, including Old Harbor Animal Shelter, two libraries and a fire station in Westchester.

The mayor also proposed increasing the city's spay and neuter fee to $40, cutting $260,000 from a fund to install new left-hand-turn signals and asking the Department of Water and Power to assume the $1.5 million cost of testing fire hydrants. Under the plan, the city also would create a "tax amnesty plan" to try to bring in $5 million in uncollected tax revenue.

Council President Eric Garcetti said the mayor's plan amounted to "classic belt-tightening." "There's shared pain; it doesn't put the burden disproportionately on anybody," Garcetti said.

The council's budget committee chairman, Councilman Bernard C. Parks, said the mayor's plan was "a good first effort" that would put the city's departments on notice "that more is to come." The mayor has asked the council to vote on the plan before the holidays. It is scheduled to go before the council's Budget and Finance Committee on Monday.

Parks and Councilman Greig Smith have asked Villaraigosa to consider temporarily freezing or slowing Police Department hires that are part of the mayor's plan to add 1,000 officers. But Villaraigosa dismissed that suggestion in Friday's letter: "At a time when the economy is in decline and unemployment is on the rise, we must maintain our shared commitment to growing the police force."

Reston is a Times staff writer.