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Unemployment, Pension Costs Force County Deficit Up



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(Sacramento, CA)
Thursday, May 27, 2010
When the county lays someone off, it doesn’t save 100 percent of the employee’s costs.
 
Szalay: “There’s also vacation that you need to pay, as well as unemployment claims.”

And Sacramento County’s interim executive, Steven Szalay, says the county has under-estimated the cost of those obligations. Add in higher pension costs and the deficit has jumped $15 million in the last month-and-a-half. So does that make layoffs penny-wise, pound-foolish?
 
Szalay: “The options are very limited. And if you can save 80-to-90 percent of a total position cost, that’s the preferred way of reducing programs.”
 
And, Szalay says, that’s roughly how much the county saves on every layoff. Speaking of layoffs, they’re going up too, and could top 1,000. Szalay plans to release his recommended budget on June 10th.
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