Gilroy hit hard by budget deficit

May 6, 2009 5:02:58 PM PDT
One smaller city being hit particularly hard is Gilroy.

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The Gilroy council says it may have to lay off 18 employees including nine cops and five firefighters, unless their unions agree to take pay cuts. The city says it cannot afford to raid its rainy day fund anymore.

It lost almost $5 million last year and is expected to lose $8 million by the end of June.

The loss is linked to plumetting property and sales taxes.

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