If a fund transfer from the DWP is factored in, the city would be left with 112.8 million dollars in its emergency fund. Without the fund transfer, only 39.3 million would be available should the city be hit with a major earthquake or other disaster, according to the report.

The report recommends continuing to cut costs. To date, 6.2 million dollars have been saved by handing out pink slips to 100 city employees, and by transferring 280 other workers to self- supporting departments.

Two departments were eliminated, and most other departments reduced services, saving an additional 16.8 million. A plan has also been worked out to eliminate up to 4,000 jobs.

"The City Council has been consistent that we are going to work hard to close this year's budget gap and we have," City Council President Eric Garcetti said. "We've tried not to propose anything that scares employees, that does things that are irrational or exuberant. But we are trying to maintain calm and a reasonable budget."

The city's total budget is about seven billion dollars. The budget gap is projected to grow to 484 million next year.

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