OAKLAND (CBS SF) — Hundreds of city of Oakland employees will get layoff notices next week because the city must cope with the decision by Gov. Jerry Brown, the city’s former mayor, to eliminate redevelopment agencies statewide, City Administrator Deanna Santana said Thursday.

However, Santana said it’s unlikely that every employee who receives a layoff notice will actually lose their job because Oakland, along with other cities around the state, is reviewing its options in complying with a recent California Supreme Court ruling that upheld Brown’s decision to eliminate redevelopment agencies.

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Santana noted that the state Legislature is working on a bill that would extend the effective date of eliminating redevelopment agencies but she said the city must begin preparing to lay off employees starting in early February in case the legislation isn’t approved.

City spokeswoman Karen Boyd said the notices will go to employees in every city department except for employees in the police and fire departments, whose contracts bar them from being laid off.

Redevelopment revenue pays for 159 city jobs but Boyd said hundreds of employees will get layoff notices so that the City Council has “broad flexibility” in deciding which employees to let go if necessary.

Mayor Jean Quan and Santana will submit a budget-balancing proposal between Jan. 20 and 23 in order to meet the current Feb. 1 deadline for eliminating redevelopment funding and the City Council will hold a special hearing on the matter on Jan. 25.

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Santana said the loss of redevelopment funding creates a potential budget gap of $25 million to $30 million for the city, although the exact size of the deficit hasn’t been determined due to many issues that haven’t been resolved.

In addition to the layoff notices, Santana has instituted a hiring freeze and is asking every department to reduce its budget by 5 percent by Friday.

In a letter to city employees, Santana said she realizes that the layoff notices will create stress and confusion but the city must go through the process in order to comply with the court decision and balance its budget.

Brown, who was Oakland’s mayor from 1999 through 2006, said he wants to eliminate redevelopment agencies because he agrees with a report by the nonpartisan Legislative Analyst’s Office that said there’s no reliable evidence that the agencies improve overall economic development in the state.

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