HomeMy WebLinkAbout2012-05-16 Packet - BudgetStep #2: Reconfigure Compensation: What Does This Mean?
May 16, 2012
Structural Deficit Facts
City of Ukiah General Fund =
$12 M Employee Cost
$ 5 M Supplies and Operations
$ 1.7 M Deficit for FY 2012/13
4 years of changes to operations, austerity, and re-organizations limits fix
Direct Contributors: Loss of RDA, Salary Restoration
CM analysis: Employee Cost of $10-10.5 Million sustainable going forward
How can Cost be Lowered and What connection is there to CM?
Public Employees covered by Labor Agreements – Negotiations necessary for Change
City Manager is appointed by City Council – serves under contract
Current CM contract contains many elements of other labor agreements
Background Information
City of Ukiah Six Labor Units:
Electric/IBEW
Fire
Fire Division Chief
Police
Director Public Safety/Captains
Management
Miscellaneous
Department Heads
MOU Agreements
Last Memorandum of Understanding (MOU) Labor Agreements:
Electric 2012 Status Quo
Fire 2008 4 yrs
Police 2007 5 yrs
Management 2007
Miscellaneous 2007
Department Heads 2006 6 yrs
Agreements Extended And Compensation Roll Backs
Salary adjustments reversed
Public Safety Units
Fire
Oct 2009 + 5% (-5%) January 2010 – June 2012)
(-5%) April-June 2009
Police
Oct 2009 + 6% (-5%) January 2010 – June 2012
(-5%) April-June 2009
33 Months of Compensation Roll back + share of 36-40% Health Care Insurance Cost Increase over six years
Agreements/Compensation Roll Backs
Management
Oct 2009 +3% (-10%) July 2011 – June 2012
Miscellaneous
Oct 2009 +3% (-10%) July 2011 – June 2012
April-June 2009 Furlough Both Units
15 Months Roll Back
Dept Heads
Oct 2010 +2.5% CPI (-5%) March 2010-June 2011
(-10%) July 2011 – June 2012
( -5%) April-June 2009
30 Months Roll Back
+Share of 36-40% Health Care Insurance Cost Increases over 6 years
City Manager Contract
May 2008 Agreement: No Increase
Rollbacks : April-June 2009 (-5%)
Jan 2010– June 2011 (-5%)
July 2011-June 2012 (-10%)
33 Months Roll Back
Share of Health Care Insurance Cost Increases over 4 years
Compaction Issues
New Labor Agreements:
Bring Compensation in-line with projected revenues for next 4-5 years
Current Deficit Projection - $1,747,000
CM recommends $1.2 Million Work Force Reduction
$500,000 to be resolved in negotiations with Units
Goal: Balanced GF going into FY 2013/14
Here is the Math:
Choices by Groups
Support $371,448
Fire $313,584
Core/Rec $309,037
Museum $228,523 = $1,222,592
Work Force Reduction Leaves = $ 500,000+
To Resolve in New MOU Agreements
Work Force Reduction vs Compensation Reduction
Whole of $1.2 M = 4-6%
( Leaves $500,000)
Half = 10 -12 %
( Leaves $1.1 M)
One Quarter = 12-14%
( Leaves $1.4 M)
None = 14-16%
( Leaves $ 1.7 M)
Why Not 36 Hour Work Week?
One Tool
Net Impact – Short term cost savings
Applied to only non-safety personnel
Does not address other compensation trends
May be used as one tool, in addition to others
Alone provides savings of about $400,000
New MOU’s Key
Bring Compensation in line with Future Revenue Projections
Larger Work Force requires greater overall compensation savings
Shortened Work Week may play a part, requires negotiations
Step #3
Council Choices
Step #1:
Right Size Organization – How Much & When
Step #2:
Re-Configure Compensation – For What Size Work Force & When
Step #3
Use of One-Time Funds– How Much, For What, and When