CHICAGO - Faced with a $50.5 million budget shortfall that is expected to grow, a top aide to Chicago Mayor Richard Daley yesterday announced $9.2 million in cuts and warned that further action, including layoffs, might be needed to keep the $6 billion budget in the black.

"The reality is that because our nation has never experienced this kind of continuing and worldwide economic downturn, no one really knows just how bad things will get, although we expect things to get worse before they get better," said Paul Volpe, Daley's new chief of staff who previously served as chief financial officer.

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