Road Maintenance Backlog Approaching Dire Stages

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pothole.jpgCity Continues to Hide the Real Costs and Real Deficit Through Deferred Maintenance –

The report was alarming on the front of transportation and street maintenance.  It made front page headlines in the Davis Enterprise that reported, “But while streets, bike paths and sidewalks will stay in good condition for the immediate future, the city’s current proposed funding allows streets to deteriorate while the cost to repair them will climb exponentially.”

City Manager Bill Emlen acknowledged the problem, “There’s lots of concern about the sidewalks and the bike paths. Realistically, it’s going to be hard to address them.”

The Public Works Department report was rather dire. The city had in fact announced that a large number of capital projects would simply accumulate as unmet needs.  While the budget will be balanced, “This backlog will continue to increase steadily if additional funding is not allocated. The higher maintenance backlog will result in increased future costs because expensive treatments will, unfortunately, be necessary if less expensive treatments aren’t utilized in a timely manner.

“The cost to maintain or repair roads exponentially increases as time goes on,” the report continued.

Sue Greenwald was rightly critical not only of the shortcomings in street maintenance funds but in the accounting process, “Citizens consider sidewalk maintenance, roads and bikeways essential services, so we can’t just redefine it away and say we have a balanced budget. We call them unmet needs, but they’re really part of the deficit. I consider that semantic.”

Meanwhile, Davis Enterprise Columnist Rich Rifkin rightly sounded the alarm, pointing out the folly of ignoring large unfunded capital projects.  “By drastically reducing spending on capital projects, the all funds budget appears to be in surplus,” he wrote.  “And counting just ongoing expenses and income, the general fund is sort of balanced. The city expects general fund revenues of $39.7 million and plans to spend roughly that next year. However, that “balanced budget” is misleading.”

All of this could have been written following Tuesday’s meeting, but it was not.  It was from June 1, 2008.  That is right, two years ago.  We were sounding the alarm in the Vanguard on the issue of unmet needs, unfunded street maintenance projects, and hidden deficits.

On Tuesday acting public works director Bob Clarke gave a report on the public works department. “In addition to the staffing cuts,” he reported, “our approximately $1 million a year road maintenance budget is down to $250,000 next year, which won’t buy us much pavement out in the field next year.”

“Some thing you’ll see immediately, some things won’t be apparent immediately but they will be impacts.  Recovering from some of them will take awhile,” he said.  “Much as my analogy would be if we don’t maintain our streets when we can do it cost effectively eventually they will fall apart and the cost to repair them will be much much more significant.”

Mr. Clarke then referred to the above conversation from 2008.  “In 2008 I came to the council and gave you an update on our maintenance effort, at the time we had an identified road maintenance backlog of over $5 million and we presented a number of scenarios about ways of getting at that backlog or at least trying to prevent it from growing.”

At that time however, the road maintenance budget was about $800,000 per year.  At that rate, Mr. Clarke said, “the backlog would continue to grow slowly, but surely.”  The needs according to the best estimates from the city are about $2 million per year.  We were never funding at that level.  Mr. Clarke said, at $800,000 per year, in a five year period, the backlog would increase to about $11 million.

Remarkably Bob Clarke then told council, even as he did not quite complete the circle about how fast the backlog would occur funding at $250,000 as opposed to $800,000, “I don’t want to paint a gloom and doom picture.  The world won’t end.  We can survive with reduced budgets for awhile.”

He did say, “What you are going to start seeing more and more of, if this continues much longer, is what I call a patch-work quilt of pavement.  Where we’re fixing potholes, doing patches at the worst point, because we don’t have enough money to overlay an entire block or a segment of road.”

He then stated the obvious, “That isn’t the most cost-effective way to maintain our street system.”

Well if Mr. Clarke does not want to sound the alarm and paint the gloom and doom I will.  The part he left out to council is the $250,000 they have this year is the last money that they have.  Paul Navazio told me after this year, they have no money budgeted for street maintenance.  That’s right zero.  They would have to start dipping into general fund monies to address ongoing needs in that area.  In the meantime, the backlog will continue to grow except not at $1.2 million per year as it had previously, but at $1.75 million per year if not faster.

This threatens to become a danger not just for motorists but bicyclists and pedestrians.  The city was circumspect on the prospect of facing liability for the increased likelihood of accidents, but it is a distinct possibility.

We talk all of the time about public safety, we hear the song and dance every year whether it is fire protection or law enforcement, but how is road Maintenance not public safety at its most basic level.

I will get into the issue later, but two years ago, Rich Rifkin was correct that the city was using smoke and mirrors to make it appear that the budget was balanced, when in fact, the city was simply putting off costs of things such as road maintenance because it lacked the funding.  They stuck their deficit into an unfunded liability and did not count that accruing deficit as part of their operating budget.

Since then the economy has gotten worse and the city has been forced to reckon with all sorts of problems that had been ignored up until that point.

The problem is, that the city is still playing the same game, they are still hiding the ball and the real figures.  At some point these bills will come due because the patch work of road repairs will decay to the point where we have to spend money from the general fund, but there is no budgeting in the general fund for it. 

So what is being sold as a small surplus in the out year under very rosy projections does not account for deferred maintenance to streets and other infrastructures, it does not account for paying off the unfunded retirement health liability, it does not seem to account for increased costs for pensions.

The real question that voters must ask, is what else is being hidden from them.  The disturbing thing for me is that while Bob Clarke is letting part of the rabbit out of the bag, he is not being fully forthcoming with what the real impact is.  What will our streets look like in three years, Iin five years, if we do not find funding for road maintenance?  We are lucky we found SACOG money to fix a real problem on Fifth Street, but unfortunately that might be the least of our problems.

Final point, and this cannot be stressed enough, the city will blame the economy on these problems and in some sense that is true.  We have not had to use general fund money for road maintenance in the past.  But what really happened is that over the course of the last decade we were growing at 10% per year in property tax revenue and we also added $3 million from the half-cent sales tax measure that is on the ballot in June for renewal.

We made the assumption for some reason that these tax revenues represented an ongoing source of general fund money and we used every bit of it to fund increases to employee compensation.  Now with the contraction and probably normalizing of the real estate bubble, we are stuck with those salaries for the most part because the bargaining groups understandably do not want to part with their salaries and benefits.

The result is that the city is now at its lowest staffing level in 12 years.  Someone the other day took issue with me categorizing the situation as cutting city services to the bone.  How else can that be described?  What are the most basic of city services?  Water, sewer, public safety, and road maintenance.  water and sewer we are looking at a 23% hike next year in the costs.  Part of that will be too offset an expected capital project, but the other part of that we learned on Tuesday is simply to pay for city staff.

We are using redevelopment money to fund police in the downtown area, but other aspects are being cut.  Fire is largely untouched except that they are shuffling money around to be able to add $400,000 for a battalion chief model.

And we know that road maintenance is probably backlogged by $7.5 to $8 million by now and going up fast.

So yes, city services, the mandatory ones are being cut to the bones.  They have dealt with current deficits with a net reduction of 60 employees, again taking us to pre-1999 levels of staffing.  In addition to fewer employees, we have furlough days where the public is not getting city services in a lot of departments.  And yet, what has hardly been touched are employee compensation.

We are cut to the bone, any additional cuts are really going to be felt and not just just in deferred maintenance where the costs won’t be apparent for a few years.

The worst news is that the budget is probably still too rosy.  Last year Paul Navazio projected neutral growth and Lamar Heystek argued we would lose revenue and Mr. Heystek was correct.  The current budget is still projecting growth in the out-years, that is ludicrous, which means we will have to find a way to cut more services in the future if those projection do not hold.  To make matters worse, we did not plan for zero growth in our employee bargaining agreements, they have small but real increases in the out-year that we will have to fund.

The bottom line is that the city needs to change the way it has done business and it cannot do that as long as this current council runs the city the way it has.

—David M. Greenwald reporting

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About The Author

David Greenwald is the founder, editor, and executive director of the Davis Vanguard. He founded the Vanguard in 2006. David Greenwald moved to Davis in 1996 to attend Graduate School at UC Davis in Political Science. He lives in South Davis with his wife Cecilia Escamilla Greenwald and three children.

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18 thoughts on “Road Maintenance Backlog Approaching Dire Stages”

  1. Greg Kuperberg

    [i]Last year Paul Navazio projected neutral growth and Lamar Heystek argued we would lose revenue and Mr. Heystek was correct.[/i]

    Mr. Heystek not only argued that the city would lose revenue, he wants the city to lose revenue. He concluded that the city should be punished for the sin of overpaying its workers.

    What this article only implies in passing is that road maintenance is not part of the general fund. I don’t know exactly why it isn’t, but it is presumably has different revenue sources that can’t be used on general fund operation. If so, then dipping into the general fund would be an expensive last resort: It would be like paying out of pocket for medical expenses that ought to be covered by insurance.

    So is that what is meant by “services cut to the bone”, that we should use general fund money to pave the roads? After that, do we cut their compensation to pay for water too? It could make sense, if the ultimate goal is to punish the city government for the sin of overcompensation.

  2. David M. Greenwald

    The road maintenance budget has been funded from state and federal sources which are now gone. It was not part of the general fund budget, because they never needed to use the general fund to fund it. Now they do and actually they have for some time, they simply decided to defer it in hopes that things might get better, I suppose.

  3. Greg Kuperberg

    A city planner from anywhere else in the region would certainly say that services in Davis haven’t been cut to the bone, that Davis has a lot more discretionary services than other regional cities. For instance — and this is just one example — the TV shows that are produced by DMA that few people watch, or the TV shows that they buy that have very little to do with Davis.

    It may be true that repavement has been cut to the bone, not by any city decision but by the state, and it may even be rational to dip into the valuable general fund to remedy the situation. But marrying that issue to city staff compensation with the slogan “services have been cut to the bone” is opportunistic blame.

    On the other hand, it is also defensible to defer repavement instead of spending general funds on it. It’s for the same reason: The general funds are more discretionary, more local, and therefore more valuable. You shouldn’t pay in silver coins if you think that the copper coins could come back. It isn’t the same as simply wishing for good news.

  4. David M. Greenwald

    “For instance — and this is just one example — the TV shows that are produced by DMA that few people watch, or the TV shows that they buy that have very little to do with Davis.”

    Your example is an expenditure that is a few tens of thousands – $27,000 to be exact. Is that really the case you’re making? Compared to 60 staff vacancies?

    You’re argument is Davis is better off than other cities in the region? I agree. That does not mean that Davis is in good shape, only that others are in worse shape.

  5. E Roberts Musser

    “Sue Greenwald was rightly critical not only of the shortcomings in street maintenance funds but in the accounting process, “Citizens consider sidewalk maintenance, roads and bikeways essential services, so we can’t just redefine it away and say we have a balanced budget. We call them unmet needs, but they’re really part of the deficit. I consider that semantic.””

    Sue is exactly right. The city’s “creative bookkeeping” is unacceptable. It hides the ball from the electorate.

    “So what is being sold as a small surplus in the out year under very rosy projections does not account for deferred maintenance to streets and other infrastructures, it does not account for paying off the unfunded retirement health liability, it does not seem to account for increased costs for pensions.

    The real question that voters must ask, is what else is being hidden from them.”

    The next thing coming is a “public safety tax” to pay for needed road repairs, so that the city can continue business as usual in regard to funding employee compensation.

  6. Greg Kuperberg

    [i]Your example is an expenditure that is a few tens of thousands – $27,000 to be exact. Is that really the case you’re making? Compared to 60 staff vacancies?[/i]

    No, it’s not the case that I’m making, as I said it’s just an example. But for the record, it’s not $27,000, it’s $270,000.

    [i]You’re argument is Davis is better off than other cities in the region? I agree. That does not mean that Davis is in good shape, only that others are in worse shape.[/i]

    It’s true that things won’t be as comfortable for Davis as they have been. But what you said was that services have been cut to the bone, and that’s just not true.

    In a way, you’ve already agreed that services haven’t been cut to the bone. You’ve pointed out that Davis seems to have a ton of planning for not all that much urban development. And that’s true, it does. I’m not against all of these planners or commissions, but if we truly can’t afford them, then in fact, we don’t have to have them. This is in effect a kind of service that hasn’t been cut to the bone. If anyone in town, on or off of some commission, has questions about the city’s plans, Davis has relatively many employees to answer those questions.

    The only thing is that it doesn’t fit the narrative of squeezing the exact same amount of service out of city staff for less compensation. It also doesn’t fit the impulse to stir the pot with a lot of questions about the city’s plans. When this site isn’t saying that city staff gets too much compensation, it’s often asking that same staff to do more research.

    It’s fine to want our taxes to be wisely spent, and it’s fine to regret bad news for the city’s budget. But phrases like “services cut to the bone” and “road maintenance approaching dire stages” make Davis residents seem incredibly spoiled. It’s a brand of “progressive” politics worthy of Qatar ([url]http://www.nytimes.com/2010/05/14/world/middleeast/14qatar.html[/url]). I’m glad that only some voters endorse this jargon.

  7. Rich Rifkin

    [i]”A city planner from anywhere else in the region would certainly say that services in Davis haven’t been cut to the bone, that Davis has a lot more discretionary services than other regional cities.”[/i]

    Davis has very similar problems that most other public agencies in California have, now. For 15 years or more, with elected politicians giving in to union demands, cities, counties and the state government have increased their employee salaries, benefits* and pensions at an unsustainable rate. The minute the economy went south — or even before, as with road maintenence in Davis — the unsustainable increases in labor costs blew the system apart.

    The only way this will be solved is by cutting back the real (inflation adjusted) labor costs to the levels they were at before Gray Davis sold out our state to his financiers, the prison guards, the firefighters, and the CHP.

    Yet reducing real labor costs alone won’t solve the even more dire problem in Davis (and in many cities and in the state government): the unfunded retiree health care liability. The only real way to solve that problem starts with more realistic retirement ages (at least 65 for healthy employees whose jobs are not physically taxing); and no longer paying any of the expense for medical care for retirees under 65 (unless they are disabled).

    *The rising cost of health care has been the biggest “benefit” problem for public agencies. This expense has gone up 10% or more per year; all the while (in Davis at least) employees have felt no impact at all from that. Unlike privately employed workers or the self-employed, where the norm is to share the increasing costs ([url]http://www.shrm.org/hrdisciplines/benefits/Articles/Pages/HealthCostForecast.aspx[/url]), public employees (in Davis) have had nothing taken out of their pockets to pay the higher prices for their health care. It seems to me that part of the solution should mimic what private employers do: make employees pay a part of the increased cost.

    It’s also worth noting that the non-cash benefits to public employees (in Davis) are really out of control: it’s not just premature retirement plans, it’s very long paid vacations and triple the number of paid holidays in the private sector, and sick days, and the ability to build up unused vacation time and sick days (in some labor contracts) to retire even earlier, and (in two unions) getting paid to conduct union business.

    If the City of Davis is to ever restore its fiscal health, it is going to have to reduce its benefits package across the board.

  8. Greg Kuperberg

    [i]The only way this will be solved is by cutting back the real (inflation adjusted) labor costs to the levels they were at before Gray Davis sold out our state to his financiers, the prison guards, the firefighters, and the CHP.[/i]

    At least in this paragraph, you’ve properly framed the problem: At the state level. In order for Davis to have the kind of budget that you want it to have, it would have to pick up and move to Arizona. Relative to what is forced upon cities in California, the Davis city government has not been particularly irresponsible. Some of the city compensation levels are a bit above market, but others certainly aren’t (look at Landy Black), and compensation at the market level or a bit higher ought to be useful for recruitment.

    Maybe the biggest problem that can actually be solved is that Davis can steer money into a mediocre project, like DMA or the now-replaced Teen Center, and still look like it does a good job because of the rest of its record.

  9. Rich Rifkin

    [b]RIF:[/b] [i]”Davis has very similar problems that most other public agencies in California have, now.”[/i]

    [b]KUPE:[/b] [i]”Relative to what is forced upon cities in California, the Davis city government has not been particularly irresponsible.”[/i]

    Forced? Forced how?

    Just because most other cities have been irresponsible does not excuse the irresponsible budgetary decisions of our elected officials. What is not at all true is that there ever has been a “tight labor market” for positions like cops, firefighters, municipal planners, landscapers or even civil engineers. I think there is always a shortage of very talented managers. But our problem was not created by overpaying our best managers. Our problem is that we have not distinguished compensation packages based on individual talents. And for the ordinary folks who would have worked much more for much less, we have just handed them the store — such as age 55 retirement with nearly full salary for life and full benefits and 5 weeks of paid vacation every year and 3 more weeks of paid holidays, etc.

    [b]KUPE:[/b] [i]”Some of the city compensation levels are a bit above market, but others certainly aren’t (look at Landy Black), and compensation at the market level or a bit higher ought to be useful for recruitment.”[/i]

    A bit above market? A bit? Including the cost of current benefits, overtime, pensions, salaries and a future cost of retiree benefits, our firefighters cost us roughly $200,000 a year each. Say we unilaterally cut that back to $120,000; and we no longer counted the hours they are asleep as working hours. What do you think they would do? Go get jobs in the private sector in which they would make $50,000 a year and have to work (really work, not sleep on the job) 40-50 hours a week, 50 weeks a year with no pension and far less generous health care?

    Part of the problem with the City of Davis labor force is we not only have high costs across the job for which our workers perform well — for example, our landscape maintenance workers cost us about 6 times as much as landscape maintenance workers cost in the free market — but we have a handful of jobs (presumably necessary jobs) which have very serious sounding managerial titles, yet the actual jobs are clerical. The work required of them is much like that of a secretary. It’s important work, but we are just paying way too much for it. No well run* company would ever pay people six-figure salaries when their primary responsibility is that of an admin aide (with a much fancier title).

    Fortunately, because so many California cities are in terrible financial shape, the real dollar “market rate” for most municipal employees is going down. However, our latest rounds of contracts don’t reflect that reality. We have frozen most of our packages at super-market rates.

    I also think it’s important to keep in mind that there are always going to be larger municipalities which can pay top-talent more money than we can pay them. It’s a mistake for Davis to think it needs to get in bidding wars for its employees.

    Only if we run into a situation in which many employees are leaving for greener pastures do we need to worry about “the market rate.” And when we face that problem, the responsible action of the city council is not to raise everyone’s compensation package across the board. It is first to consider those positions which are especially vital — like city manager, police chief, public works director; second to consider (by percentage) how much we need to increase our long-term packages to everyone else to retain them; and third, cut back on services which we can no longer afford.

    I think Greg would agree with me that one problem with the approach of the City of Davis has been to increase labor costs at a high rate without then cutting back on services. They have to be done together, when the reality is that only paying higher rates of compensation will result in retaining highly productive employees.

    *I am perfectly aware that in many private companies, these situations exist, also. Private often does not equal well run.

  10. rusty49

    Who do you think the vast majority of the rioters were in Greece? They were public employees who were having their gravy train cut back. They were rioting and trying to save their outrageous perks, salaries, vacations and bonuses that bankrupted Greece. California is headed in the same direction and the Democrats in power will never do the needed cutbacks on the unions that are needed, so bankruptsy is coming our way soon. Will the SEIU, teacher’s and other unions riot in the streets? We’re going to find out, it’s going to get ugly, but things are unsustainable the way they are now.

  11. Greg Kuperberg

    To hear you tell it, Rich, California cities don’t pay higher than necessary salaries because they have no choice, they do it simply because they’re all stupid and/or disloyal to the taxpayers. California’s city councils just don’t have that extra wisdom and integrity possessed by city councils in Arizona.

    To which I say, yeah, right. I’m just not connecting your mountain of opinions to serious expertise in public policy or labor economics. It’s true that my degree is in mathematics and not in either of these fields, but I think I can tell the difference between a Winston Churchill and a Ward Churchill.

  12. J.R.

    “To hear you tell it, Rich, California cities don’t pay higher than necessary salaries because they have no choice, they do it simply because they’re all stupid and/or disloyal to the taxpayers.”

    Greg, for whatever reason, does not seem able to fairly understand other points of view.

    There are many pressures on city council politicians to implement policies which have immediate benefits and whose costs are delayed. Might these policies lead to financial disaster a few years down the road? Well, that’s a problem for a different city council and anyway, voters have short memories.

  13. Rich Rifkin

    [i]”California cities don’t pay higher than necessary salaries because they have no choice, they do it simply because they’re all stupid and/or disloyal to the taxpayers.”[/i]

    Please explain why, for example, the City of Davis gives the benefits and pensions it does to landscape maintenance workers? Are you serious that is “the market rate”? I have not studied all other cities that closely. However, my guess is that, yes, they are also not looking out for their taxpayers’ best interests in many cases.

    Part of it is pretty obvious special interest politics: the Democratic Party and most of its elected officials are doing the bidding of the public sector unions. But that is not every bit of the explanation. The more important factor is that the pols are not spending the money as if it were their money. They are more sympathetic to the people they are giving the money to than those they are getting the money from. That’s not unique to government largesse. It’s the same thing when corporate boards of directors approve ridiculous contracts with their executives.

  14. Rich Rifkin

    Let me expound upon my question above: Greg, if you, say, had a marginal landscape management business and you had to hire a landscaper, would you pay him $10/hour (which happens to be the going rate in Davis for new hires) or would you offer your employee the city package for its beginning landscaper laborers (PARK MAINTENANCE WORKER I)?

    The former includes no benefits, no paid holidays, no early retirement packages, no pension, no medical care from age 55 to death, no dental care, no eye glasses package, no convalescent care, etc., etc.

    The latter starts at $39,000 per year salary. It includes life insurance, plus a $20,000/year medical insurance plan, plus convalescent care insurance, plus long-term disability insurance, plus lifetime retiree medical, plus 3 weeks of paid vacation to start (and increasing after 3 years), plus 3 weeks of paid holidays, plus an employer-paid pension which will pay your landscaper 75% of his highest annual salary beginning at age 55, if he starts with you at age 25.

    You would describe anyone who chose the latter as “disloyal.” I would describe them as “our city council.”

    There are community values that are not exactly in line with “the market rate. I understand that. But for you to claim that our city (or any government entity) is making its labor decisions on the basis of “the market rate” alone is utterly laughable.

  15. Greg Kuperberg

    [i]Well, that’s a problem for a different city council and anyway, voters have short memories.[/i]

    But, mysteriously, they have much shorter memories in California than in Arizona, where public wages are lower. Alzheimer’s disease runs rampant west of the Colorado River.

    [i]Please explain why, for example, the City of Davis gives the benefits and pensions it does to landscape maintenance workers? Are you serious that is “the market rate”?[/i]

    It is a market rate for public employees, modified by collective bargaining and also by liberal empathy. The Park Maintanance Worker I salary is after all one of the lower city salaries, only $36K to $44K.
    Now, liberal empathy is a funny factor. It may not typically be in the taxpayers’ selfish interest, but it is some cases the taxpayers’ expressed interest. For instance, do Lamar Heystek or Sue Greenwald want to cut salaries at this level?

    Anyway, if we just had collective bargaining and no liberal empathy, then these salaries might not be all that different. Davis voters don’t particularly want the park maintenance workers to go on strike. In fact, they don’t even want an impasse, much less a strike.

    [i]Part of it is pretty obvious special interest politics: the Democratic Party and most of its elected officials are doing the bidding of the public sector unions.[/i]

    But that is an explanation at the state level, which I agree is where the real explanation lies.

    [i]You would describe anyone who chose the latter as “disloyal.”[/i]

    If I thought that the city council could actually help it and that the voters didn’t want it, then yeah, it would be disloyal. That’s why David and Daniel keep intimating that it is disloyal, by calling the city council “bought and paid for”.

    Anyway there is again something that you’re missing in all of this. You’ve very earnestly explained what you really believe, and that’s fine. But it won’t make sense to me until I see it explained by someone more expert and less zealous. Just as if you sang the praises of some special kind of cancer treatment, then even if I didn’t see anything wrong in what you said, it wouldn’t make sense to me if I couldn’t hear it from a good doctor or similar. If it were the narrow question of one person’s salary or one city’s behavior, it would be one thing, but you’re arguing sweeping principles of labor economics.

  16. Rich Rifkin

    [b]GK:[/b] [i]”To hear you tell it, Rich, California cities don’t pay higher than necessary salaries because they have no choice, they do it simply because they’re all stupid and/or disloyal to the taxpayers.”[/i]

    So Greg seems to think California cities don’t pay higher than necessary salaries. He’s wrong, of course. (There is a good reason why we get 100-125 qualified applicants for firefighter openings.)

    [b]GK:[/b] [i]”Relative to what is forced upon cities in California, the Davis city government has not been particularly irresponsible.”[/i]

    So Greg seems to think Davis has been “forced” to pay above-market wages. I see no evidence of force.

    [b]RR:[/b] [i]”(PARK MAINTENANCE WORKER I) starts at $39,000 per year salary. It includes life insurance, plus a $20,000/year medical insurance plan, plus convalescent care insurance, plus long-term disability insurance, plus lifetime retiree medical, plus 3 weeks of paid vacation to start (and increasing after 3 years), plus 3 weeks of paid holidays, plus an employer-paid pension which will pay your landscaper 75% of his highest annual salary beginning at age 55, if he starts with you at age 25.”[/i]

    [b]GK”[/b] [i]”It is a market rate for public employees, modified by collective bargaining and also by liberal empathy.”[/i]

    That’s not a market rate! In no way, shape or form is that package a “market rate.” Your entire argument (for months) has been that these packages are “market rate” and that any cuts will destroy our workforce with strikes and or an exodus to other cities.

    I agree it’s “liberal” empathy. It’s the byproduct of what you call “disloyalty to the taxpayer.” It hasn’t got a damn thing to do with “market wages” and you know that. You just don’t want to admit your argument is fallacious.

    [i]”If it were the narrow question of one person’s salary or one city’s behavior, it would be one thing, but you’re arguing sweeping principles of labor economics.”[/i]

    I am arguing that you have no idea what you are talking about when you make claims that a) municipal wages are set by the market; or b) that the labor market itself (for most municipal jobs) is at all tight; or c) that the result of giving compensation packages which were in line with market compensation would be catastrophic*.

    You are arguing out of an outdated textbook, Greg. All of your assumptions are false.

    *I certainly agree with you that many of our public employees would strike if we paid them what they could command in the labor market. I would respond the same way President Reagan did. Fire them and hire people who want to work for the city of Davis. That would not be a catastrophe.

  17. hpierce

    Mr. Rifkin, in making his points, exaggerates in doing so. Points include:

    Private sector employees get no “pensions”. Employers and employees pay into Social Security, and that “pension” exists in the private sector. Many in the public sector are not part of Social Security. Many public employees gave up COLA’s in lieu of having the employer pay their share. The point that could be valid is the difference in cost between SS & PERS contribution rates. It should be noted that only a portion of higher paid private sector employees’ salaries are subject to SS taxes. In the public sector, ALL salary is subject to the contributions. It should be noted that a great majority of those receiving SS benefits today will reap far more than either they or their employers ever paid, but unlike the public sector employees, the SS beneficiaries are actually receiving the contributions of those still working (who will likely have comparatively less benefits)… talk about “un-funded liabilities”…

    Vision insurance, at least in Davis, is 100% paid by the employee, as is long-term care (“convalescent care”, per Mr. Rifkin)… true, an employee who doesn’t use their cafeteria (med/dental) benefit, could apply the “excess” funds to the other benefits, but philosophically, I concede that the cafeteria benefit should be limited to the actual medical/dental coverage for the employee & family, with no provision for cash-out of “excess”.

    Vacation & “holidays”… on holidays Mr Rifkin is off by 4 hours of leave. Yes, in my opinion, these are high, but they were traded, in lieu of COLA’s in the past. Raise the salaries & lose the days, to compensate.

    Mr. Rifkin implies, based on Firefighter applications, that the City has no fear of market forces to recruit… I beg to differ, as I know of recruitments for professional staff, where at ‘the end of the day’, [u]no[/u] qualified candidates were reported out of the qualifications panel (before they go to the department for final selection)… there have been several others where only two or three have even made it past the qualifications panel, which tends to be very “liberal” (an HR problem, in itself).

    Mr. Rifkin seems to want it both ways as to liberal empathy… but he has clearly said that rank & file & upper salaried employees should ‘take a hit for the team’ to save lower paid jobs. apparently irrespective of whether the positions proposed for layoff are necessary for the fulfillment of the City’s mission.

  18. Greg Kuperberg

    First of all, Rich, if you’re more interested in your characterizations of what I think than my own, then that means that the discussion is close to an end. I don’t need all of this, “Greg seems to think X, Y, and Z”. I’ll just give my own answer as to what I think on one point:

    [i]that the result of giving compensation packages which were in line with market compensation would be catastrophic[/i]

    What I actually think is that it would be bad for Davis to fight against a labor system that is mainly set up by state laws. It would be bad for Davis because it would lose. The idea that Davis could do to the parks workers what Reagan did to PATCO is a delusion. But it probably wouldn’t be “catastrophic”. We would get scratched up in the thorn bush, and then eventually climb back out again and go back to business as usual.

    You and this blog have made so much hay over some on-again, off-again campaign support from ONE group of city employees for city council support. All unions in California have fought hard for leverage in Sacramento. With only occasional exceptions, public worker unions don’t give a @#$! about city council elections or school board elections. Why? Because they know where the playing field is. What you’re trying to do — and this is not remotely meant as me announcing what you think or seem to think — is score a touchdown in the stands.

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