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March 6, 2009
Fontana has laid off a dozen employees and is hoping to save more money by offering an early retirement program.
The City Council will vote on the Golden Handshake program offered through the state Public Employee Retirement System at its Tuesday night meeting. If the city offers the program, eligible employees who retire would get two additional years of service credit, increasing their pensions.
City Manager Ken Hunt surveyed employees last month about the program and found that 20 might be interested. He said he expected seven to 10 to take the retirement package.
Last week, the city laid off 12 employees, many in the development services department, which has seen a marked decrease in demand because of the construction slowdown.
The layoffs resulted in $1.3 million in savings, and the retirement package could save another $1 million, Councilwoman Janice Rutherford said.
"It's very sad to have to lay people off, but Fontana is in a better position than many cities," she said.
"We've got reserves and hopefully the sales tax won't continue to decline so we won't have anyone else lose their jobs."
The cuts will help close a $5.7 million budget gap resulting from declining sales tax revenues.
Part of that was achieved through program cuts and eliminating 21 vacant positions last month.
The city also will dip into a reserve fund created specifically for periods of economic uncertainty, Rutherford said.
Mayor Mark Nuaimi said the city likely will cut back on special events and in its marketing and lobbying programs. The cuts should not affect most city services, he said.
"Given the slowdown, given the reduction in development, I'm hopeful the community will not recognize a marked reduction in service," he said.