Eleven unionized New York City employees who work in Chicago and Los Angeles are targeted for layoffs because of a misguided decision by the Dept. of Finance.

The agency is shutting its two out-of-state offices, which together bring in nearly $40 million in revenue while costing only $720,000 to maintain.

“We have been bringing in a lot of revenue for the city, which is what makes this decision so perplexing,” said Tax Auditor Sean Lowery, a Local 1407 member working in the Chicago office. “The city faces a big budget deficit. You don’t lay off Tax Auditors when the city desperately needs money.”

Five Tax Auditors work in the Chicago office, and another four work in Los Angeles. Three clerical workers in the offices will also lose their jobs, say the members of Accountants, Auditors and Statisticians Local 1407.

In March, the agency informed the workers of the closings, which are to occur by June 30. Virtually none of the workers will be able to accept the department’s
offer to relocate to New York City because they are homeowners and their spouses have jobs.

With the economy mired in unemployment, “It’s a bad time to be looking for a job,” said Saji Varghese, a Tax Auditor in the Los Angeles office. Mr. Varghese, 33, and his wife, a nurse, have a 7-year-old boy and 1-year-old baby son, and they own a home outside the city.

Several of the workers feel betrayed by Finance, especially because they were told they would enjoy the job security of ordinary city employees when they were hired, Mr. Varghese said.

“Closing the offices doesn’t make any fiscal sense because the department won’t be saving money,” said Local 1407 President Maf Misbah Uddin. “The agenda here seems to be to downsize the work force and farm out tax auditing to consultants,” he said.

Since the mid-1990s, the number of Tax Auditors at the department has dwindled from 650 to less than 400 while their work is doled out to collection agencies. But, say Local 1407 members, despite the worst fiscal crisis since the mid-1970s, between $1 billion and $2 billion in real estate and business taxes remains uncollected.

Mr. Varghese noted that many states maintain satellite tax offices in other states.

Audits often require several office visits, and over half of the audits done by the two offices involve local companies that do business in New York City but are too small to justify the cost of out-of-town travel by city employees.

Those audits bring in more than $20 million a year. The larger audits fetch $18 million a year. The office closings will make it more difficult and costly to collect that money, further cutting the income of a revenue-starved city.