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Gilroy City Hall. Photo: Erik Chalhoub
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Faced with dwindling revenue brought on by the Covid-19 outbreak, the City of Gilroy is set to lay off 10 more workers after it was unable to reach a concessions agreement with an employee group.

The 12 positions cut, two of which are vacant, are represented by the labor group American Federation of State, County and Municipal Employees Local 101. Employees affected include maintenance workers, a custodian, an accountant, the deputy city clerk and others.

With the Covid-19 health emergency slashing a significant portion of the city’s revenue streams, mainly sales tax and transient occupancy tax, Gilroy is faced with an $8 million shortfall over the next two years, according to Interim City Administrator Jimmy Forbis.

Half of that shortfall was addressed with the first phase of the city’s financial recovery plan, which cut 33 full-time positions—12 of which were vacant—as well as furloughing most part-time staff.

The rest was expected to be achieved through concessions with labor groups, primarily through pay reductions and eliminating raises.

The city was able to reach agreements with other groups, including the police and management associations, which eliminated raises and added furlough days, among other concessions.

But such reductions would be devastating for the city’s lowest-paid workers represented by AFSCME Local 101, Union Representative Carol McEwan said, adding that the city proposed salary concessions of up to 10 percent. 

“We understand the city is in a hard place,” McEwan said. “We want to work with them, but we can’t take the majority of the hits. The people cannot afford it.”

The city’s proposal to eliminate 12 positions is expected to save roughly $1.2 million annually, according to city staff.

McEwan said union leadership presented the city with more than 30 cost-saving measures as alternatives, but all were rejected. Those measures included eliminating the Fourth of July fireworks show and pushing plans for a parking lot downtown to a future year.

City spokesperson Rachelle Bedell confirmed the layoffs, and said they are scheduled to take effect Aug. 31.

The layoffs are expected to impact various services across most city departments. 

In a July letter to the city council, City Clerk Shawna Freels wrote that eliminating the deputy city clerk position, held by Suzanne Guzzetta, would leave herself as the sole employee of the city clerk’s office.

As such, Freels said the office will experience delays in responding to public records requests, elections processes and other records management.

“This dramatic reduction in staff will make it unmanageable for me to fulfill my workload obligations as your City Clerk,” she wrote. “The proposed reduction of the single employee left supporting my office will bring staffing levels back 25 years, and has not been well thought out.”

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Erik Chalhoub joined Weeklys as an editor in 2019. Prior to his current position, Chalhoub worked at The Pajaronian in Watsonville for seven years, serving as managing editor from 2014-2019.


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