HomeMy WebLinkAbout0 - Public Comments - Non-Agenda Items813
Newport Beach City Employee Costs - The Good, The Bad and The Ugly (8- 13 -13)
The Good — City employee headcount has grown only 9% over the last 14 years. City Council has
done a good job of outsourcing some services and continues to look for outsourcing and
consolidation opportunities. The other good news is the City Council is making headway in getting
employees to pay a portion of their benefits.
The Bad - At the June City Council meeting, The City Manager, David Kiff, showed a slide comparing
his salary to his predecessors and left the impression that he was underpaid. This was a little
misleading because he could have also compared his compensation to prior city managers and a
more accurate comparison could have been made. I went back to the oldest city budget on file in the
city library next door, the 1998 -99 budget, to see what salaries were then and then compared them to
present salaries. Many department names and position names have changed over the years, but I
found 5 positions (City Manager, City Attorney, City Clerk, Fire Chief and Police Chief) that are the
same from 1998 to today. The CPI increase over this 14 year time period totaled 41 %, but these
salaries increased almost double the rate of inflation - an average of 77 %. Over these last 14
years, we have had two very deep recessions when many private sector jobs were lost and those
who kept their jobs were happy to keep up with inflation. The Newport Beach employees had almost
no layoffs, salary increases well above inflation, retirement benefits that were significantly improved
and now their office work environment is world class. But they think they need a raise. This is bad.
The Ugly - Public employee unions have become very good at gaming the system in pay and
benefits. The game starts out with a "market survey," like the one recently completed by Fox Lawson,
to make sure city employees are being paid "fair." These "market surveys" consistently conclude that
the employees being studied are underpaid. Have you ever heard or seen one of these studies that
did not conclude that salaries and benefits need to go up? If such a study were ever done, that firm
would be excluded from the game and be out of business. This is the ugly little secret behind the
ever escalating public employee salaries and benefits - staff recommends, at taxpayer expense,
biased studies that always conclude they need a raise. Please do not fall for it this ugly scam.
Four suggestions:
1) Continue to outsource services and find ways to decrease staff levels while maintaining
necessary services. There should be continued productivity gains from our highly paid staff in
their very high quality new work environment.
2) Continue to increase the contribution rate paid by city employees to pensions and health care
costs until they approach the level paid by private sector employees.
3) For existing city employees - no pay cuts, but cap future salary increases to inflation.
4) When an employee leaves or retires, if a replacement is necessary, offer the job for the
replacement at about 60% of the prior employee's pay. If no qualified applicants are found, then
increase the offer to 70% or until you have a qualified pool of applicants. The marketplace will tell
what the market pay is, not bias salary studies.
Thank -you
Attached: City of Newport Beach Employee Headcount and Salary Comparison 1998 -2012
City of Newport Beach Employees - Historical Comparison
City of Newport Beach Salaries (not including benefits) - Historical Comparison
Community
Salary
Community
Services
Inc. in
Budget
Development
CPI
(Library,
Title
Code
1998 -99
2012 -13
General City
Public Safety
(Planning &
Public
Rec., Sr.
8000
$132,918
$231,750
Year
Government
(Police /Fire)
Building)
Works
Citizens
Other
Total
%
1998 -99
63
342
37
154
49
43
688
64%
1999 -00
69
344
39
157
51
43
703
2%
2000 -01
75
358
42
155
53
45
728
4%
2001 -02
77
384
44
163
57
46
771
6%
2002 -03
77
384
46
164
58
46
775
1%
2003 -04
84
385
46
162
57
47
781
1%
2004 -05
86
385
47
162
60
48
788
1%
2005 -06
90
388
48
163
65
47
801
2%
2006 -07
93
393
52
163
66
47
814
2%
2007 -08
93
396
52
165
68
48
822
1%
2008 -09
85
397
63
145
71
71
832
1%
2009 -10
81
394
59
134
69
68
805
-3%
2010 -11
84
394
58
131
70
69
806
0%
2011 -12
68
359
58
117
68
93
763
-5%
2012 -13
68
357
56
117
70
84
752
-1%
14 Yr. Inc. #
5
15
19
-37
21
41
64
14 Yr. Inc. %
8%
4%
51%
-24%
43%
95%
9%
City of Newport Beach Salaries (not including benefits) - Historical Comparison
Salary
Inc. in
Budget
CPI
Excess of
Title
Code
1998 -99
2012 -13
Increase
% Inc.
Inc.
Inflation
City Manager
8000
$132,918
$231,750
$98,832
74%
41%
$44,578
City Attorney
8005
$125,740
$216,960
$91,220
73%
41%
$39,895
City Clerk
8010
$68,250
$111,782
$43,532
64%
41%
$15,674
Fire Chief
8115
$112,752
$205,944
$93,192
83%
41%
$47,169
Police Chief
8145
$119,969
$221,344
$101,375
85%
41%
$52,406
Average
$111,926
$197,556
$85,630
77%
41%
$39,944