It's too early to know how Erie County will address a potential multimillion-dollar deficit resulting from lost sales tax and other revenues.
But one thing appears increasingly clear – widespread county layoffs are unlikely to solve that problem this year.
That is true even though Erie County is one of the largest employers in Western New York, with more than 5,000 employees. Many have been deemed "unessential" yet continue to receive full pay.
"We can't pretend that layoffs are even really an option because, number one, we've already paid 50% of county employees' salaries through the year," County Legislature Minority Leader Joseph Lorigo, C-West Seneca, said Thursday. "We're going to be responsible for paying their unemployment. It's not going to save us any money."
Erie County has roughly 4,400 full-time employees, 840 part-time employees and 170 season workers, based on information provided by the Erie County Personnel Department. The county's technology staff has found ways to enable the vast majority of them to continue to contribute to county work, even if they are at home, said county spokesman Peter Anderson.
That leaves another 92 employees who are currently paid while not working at all.
That includes 20 employees who work for Erie County libraries, 21 employees with the Board of Elections, 21 in the County Clerk's Office and 18 in the District Attorney's Office. Another dozen work for other departments.
Laying off these or any other county employees would be difficult and save less money than might be expected.
That's due to several reasons:
- Erie County is self-insured for unemployment. That means if anyone from the county is laid off, the county is on the hook to pay that individual's unemployment income, except for of the $600 federal pandemic unemployment assistance grant, county administrators said.
- County employees have worked for nearly five months and accrued vacation and compensatory time that must be paid if they are laid off, according to the Comptroller's Office. In addition, employees who are laid off must generally be given at least two weeks notice, so they could not be immediately cut from the payroll.
- Finally, unionized employees are entitled to "bumping" rights. Employees with more seniority who are laid off are allowed to move into lower paying jobs that they are qualified for. That has a downward trickle effect, so a person who is technically laid off can end up bumping a lower-level employee out of a job.
Erie County administrators in both the Finance and Management Department and the Comptroller's Office told legislators on Thursday that laying off employees is unlikely to be an effective answer to closing a major deficit.
Anderson also said some of the employees who are currently doing no work now may be retrained as contact tracers.
While many county employees have been deeply troubled by the directive from County Executive Mark C. Poloncarz for each department to come up with a way to cut 13% in expenses, that "worst case scenario" is unlikely to play out, especially if the federal government comes through with additional stimulus money for local governments.
The Legislature already voted 7-4 on May 7 to allocate $24 million in surplus money from the 2019 budget to offset the anticipated revenue shortfalls this year. Deputy Budget Director Benjamin Swanekamp said that if a significant stimulus package is approved to aid counties, there might not be any deficit.
That has not prevented employees from calling their county legislators concerned about their job security.
"I have employees emailing me and calling me constantly, worried about their jobs," said Legislator John Gilmour, D-South Buffalo.
He pointed out that in the past, major budget deficits have been closed with layoffs. Even if it's possible for the county to close its deficit for 2020 without laying off anyone, Gilmour said, that doesn't mean layoffs won't be looming next year.
With the economic slowdown and a major recession expected to linger for the foreseeable future, many county leaders agree the strain on county finances is expected to continue for some time.
"I am committed, and I believe everybody else here, from what they're saying, is committed to make sure we save all the jobs we can," Gilmour said.
Erie County was down nearly 20% in sales tax revenue for March and, so far, is down 5% to 6% for the first quarter, said Deputy Comptroller Gregory Gach said. He also said if the sales tax shortfall remains at about the 20% level, the county could be short $80 million to $100 million.
Legislature Democrats lambasted both Gach and Comptroller Stefan Mychajliw on Thursday for declaring a 2020 budget deficit so swiftly on May 4 when a deficit does not exist right now, and while it's unclear how significant a deficit the county will face because of the pending federal stimulus package.
The county charter gives the county executive seven days to respond to the declaration, but Poloncarz issued an executive order under the state of emergency granting himself 30 days to respond and to take future federal funding into account.
Republicans called Poloncarz's executive order "illegal." Democrats called Mychajliw's declaration "outrageous." Poloncarz said, "The law is on my side."
Poloncarz has also said he has frozen all nonessential hiring and purchases to address revenue shortfalls. Mychajliw and Gach said Saturday they don't believe all nonessential hiring is truly frozen.
The comptroller said he is submitting his office's recommendations on a deficit reduction plan on Monday. That plan will include the recommended elimination of all vacant positions, which number a few hundred, and would not raise taxes, he said.