Many people argue that public sector workers, including firefighters and police officers, are vital to the functioning of their community, and that cutting back benefits for these employees would reduce the quality of the workforce willing to do vital public sector jobs, but how do we fix the deficit facing many states? What are other possible options?

While it's true that public safety is a large line item in municipal budgets, it does not necessarily mean that money earmarked for these programs should be the first place administrators look when pinching pennies. Some would argue that without sound public safety organizations, not much else matters. 
Supplemental efforts, such as volunteer firefighters and neighborhood watch groups, can help defray the cost of hiring professionals. Education and prevention, in the forms of community policing and public relations campaigns, can also have a positive impact on a municipality's bottom line. (You may remember characters like McGruff the crime dog or Smokey the Bear, both part of national public education campaigns.)
Municipalities facing large deficits are in a unique position to identify cost cutting solutions that can serve as a template for a region or even the nation. In Dauphin County, Pennsylvania, for example, sharing precinct resources among eight townships saved the county millions more dollars than originally expected, and allowed some service areas to add full time officers to the payroll.
Community grants are another source of revenue to supplement department coffers, particularly when the recipients are willing to work toward common goals within their municipalities. For example, Harford County, Maryland was one of the first recipients of a mental health court block grant, which served as a pilot program for the Substance Abuse and Mental Health Administration (SAMSHA). This grant required the cooperation of local law enforcement, district court, states' attorneys, parole and probation, and the local detention center. Pilot programs on the federal or state level can bring notoriety and funds to a community, while encouraging innovation within public safety professions. 
https://www.search.org/resources/public-safety-project-resources/