One City To Cut Up To 500 Jobs During Budget Crisis - Others Laying Off Outside Firms - Does It Pay To Be A "Contract" City?

The Sacramento Bee reports that up to 500 jobs may be cut to make ends meet in the river city - That is roughly 10% of the entire cities workforce. The state of California and many local governments are facing significant revenue shortfalls as a result of the weakening economy and real estate market crunch. In fact, the state is facing an estimated $16 billion shortfall.

Sacramento is facing a budget shortfall of $48 million to $58 million next fiscal year. The city's general fund budget is about $450 million.

Already, City Manager Ray Kerridge has ordered a hiring freeze with some exceptions, has told departments to cut travel and other unnecessary expenditures, and has asked each department to put together plans to cut from 10 percent to 20 percent of its budget.

This month, the city's Development Services Department has given pink slips to 28 full-time employees.

Meanwhile the cities of Elk Gorve, Rancho Cordova and Citrus Heights arent sweating layoffs - they'll be laying off firms instead.