St. M’ville lays off workers as revenue drops

With city revenues down due to the stay-at-home order issued last month by Governor John Bel Edwards in response to the coronavirus pandemic and closures of tax-producing businesses, the city has significantly reduced its workforce.
The city council approved the layoff of 25 part-time and two full-time employees during a special meeting on April 14.
Only Mayor Melinda Mitchell, Councilman Mike Fuselier and City Clerk Lorrie Poirier attended the meeting in person. Other officials participated through teleconferencing due to COVID-19 restrictions on large gatherings.
In addition to the 27 layoffs, two other employees were placed on temporary furloughs so they could be brought back more easily when circumstances improve.
The move, recommended by Chief Administrative Officer Avis Gutekunst, will save the city $20,000 per pay period, or $40,000 per month.
Gutekunst said that, while March figures are not yet complete, she expects that revenues have probably dropped by about $120,000 per month.
“Video poker revenues, of course, are off by 100 percent,” she explained. “And sales taxes are probably down by about 40 percent.”
She told the Teche News that the city usually has about 97 people on the payroll, so close to 30 percent have been laid off or furloughed. Asked if more layoffs can be expected, she said that, as things stand now, she doesn’t think so.
“This will buy us some time,” she said, “and we still have a city to run.”
Council approval will be required for workers who are laid off to be restored to their positions. But attorney Allan Durand commented that he doesn’t think the city will be legally required to advertise for the positions as if they were new hires.
Gutekunst said she and Mayor Mitchell wanted to handle the reduction through layoffs rather than furloughs as much as possible. She said “We didn’t want to keep people on the hook for three to four months. This way, those who need to seek other employment can do so.”
Employees can apply for unemployment compensation in either case.
Most emergency federal funds for governments under the federal Coronavirus Aid, Relief and Economic Security (CARES) Act will be paid to the states. None is earmarked for municipalities with populations less than 500,000.
But Gutekunst said that a letter from the Louisiana Municipal Association suggests that the organization is trying to find a way to channel some of those funds to local governments.
Finally, Gutekunst said the three to four month timetable for any hope for improvement is probably realistic. Even if things were to improve faster than experts project, there will be a lag in city revenues returning to normal.
“For instance,” she said, “if things were to improve enough for video poker revenues to begin flowing again by, say, the end of May, that revenue has to go to the state first, then the parish. It would only begin to filter back to the city in late June or early July.”
Utility service billing is not expected to go down, and may even rise due to customers spending more time at home. But those revenues could also be in question if many out-of-work residents are unable to pay their bills.