Dallas furloughs city workers after virus crushes finances

Dallas officials announced Friday that around 500 of the city’s approximately 13,000 workers will be furloughed for 2 1/2 months starting next week because the coronavirus pandemic has decimated municipal finances.

The move came as deaths in Texas linked to COVID-19, the illness caused by the new coronavirus, topped 1,000 on Friday, with confirmed cases topping 36,600. The true numbers are likely higher because many people have not been tested, and studies suggest people can be infected and not feel sick.

The furlough is to run from next Wednesday through July 31 and will include employees across 10 departments. Use of paid leave and vacation time will not be allowed, but furloughed workers will continue to be covered by the city health care plan and will be eligible for unemployment benefits, City Manager T.C. Broadnax said.

In a letter sent Friday to employees, Broadnax said the April-long economic shutdown imposed by the outbreak was expected to cause a $25 million budget shortfall this year. Republican Gov. Greg Abbott is slowly easing restrictions on business activity, but Broadnax said a shortfall of $73 million to $134 million was still expected in next year’s budget.

Broadnax said no essential workers or nonessential workers approved for working from home will be affected immediately. However, this may not be the last furlough needed to meet the challenge of slashed city revenue from the economic shutdown and subsequent squeeze. The effort to stabilize the city workforce may require intermittent furlough days, additional job positions selected for extended furloughs, even layoffs, he said.

“We are closely monitoring our budget and implementing cost saving measures in other areas to help cover both immediate and projected shortfalls,” Broadnax wrote to employees.

Dallas Mayor Eric Johnson, who said he had known such measures were likely, added in a statement Friday that the city’s fiscal horizon remained cloudy.

“Further difficulties may still be ahead as we face historic budget shortfalls caused by COVID-19,” he said.

For most people, the coronavirus causes mild or moderate symptoms, such as fever and cough that clear up in two to three weeks. For some, especially older adults and people with existing health problems, it can cause more severe illness, including pneumonia.

As much of a blow the pandemic dealt to Dallas finances, it pales next to those faced by Houston, where the economy is still dependent on the oil and gas industry. The price of oil has recovered to about $25 a barrel after plunging below zero last month as demand vanished because of the worldwide COVID-19 lockdown.

As a result, Houston Mayor Sylvester Turner expected a city budget deficit of about $200 million, the worst in the history of this city of more than 2.3 million, the country’s fourth largest.