Sunday Commentary: Examining an Initiative Limiting Future Employee Compensation Growth

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firefighters-friends-ofFor the 2005-2009 MOU, the firefighters received an aggregate 36% pay increase just in salary.  That did not include benefit increases – the 3% at 50 that would make for windfall retirement pensions – and other perks.  Not only was the increase unsustainable, it was unequal.  The police officers at the same time took a much more modest 17% increase, and most other bargaining units saw about a 15% increase.

The firefighters took advantage of several key things.  First, the city’s general fund budget was booming with double-digit revenue increases from property taxes for several years.  Second, somehow, city leaders managed to convince the public that, despite the real estate revenue boom, they city needed more revenue and got the public to approve a half-cent sales tax generating $3 million that would effectively go to the firefighters.

And third, the firefighters were vocal and organized.  For several years, they took out collections and bundled $100 contributions to ensure friendly faces on the city council.  And it worked.  From 2002 until 2008 – four elections – the firefighters succeeded in winning all but two elections.  Only Lamar Heystek in 2006 and Sue Greenwald in 2008 won without firefighter support.

But the economy collapsed, and a concerted effort by first the public and then the city council, and finally the city management itself, changed things.  By 2012, there were no remaining members on council that were overtly supported by fire.  Fire has found a consistent ally in Lucas Frerichs  and a periodic one in Dan Wolk, who opposed staffing changes but also supported budget cuts and management changes.

Still, it is a perilous majority as the 3-2 vote on fire staffing showed.  One new fire-friendly councilmember, with the exit of Joe Krovoza and perhaps Dan Wolk, could drastically swing the balance of power in city government.

The firefighters, knowing that they lacked the votes on council to support the status quo, shifted strategies to mobilize the public.  First, in the winter and spring, they attempted to have community meetings and they went door to door with leaflets, and they followed that strategy up with pickets in front of city hall.

These tactics, however, have demonstrated that it is far more difficult to mobilize the public than it is to secure three votes on council through election and influence peddling.

In the meantime, while five of the seven city employee bargaining units have signed the new MOU taking concessions, there are still two holdouts – the firefighters and, for the second time in a row, DCEA (Davis City Employees Association).

These holdouts have come with considerable cost to the city and, by extension, to the public.  Each month they hold out is another $114,000 in lost savings that will have to come out of other expenditures.  That could mean additional layoffs, and it could mean additional cutbacks in services.

While the city has made progress, there is a looming secondary budget deficit as the city now has to put money into infrastructure that had its maintenance deferred for the last six years or more.

With the uncertainty of the new council mix, there may be a better way to remove the influence of special interests and firefighter money on future councils.

The city council or citizens could put forward an initiative that would cap future total compensation increases to the percent increase in the general fund revenue.

What that would mean is that, during good times, city employees would benefit from general fund revenue increases.  They would be able to, in future MOUs, receive the same total compensation increase as the city’s increased general fund revenue.

It is easy to increase revenue during good times under the existing system, as everyone wants to reward the good work of city employees.  At the same time however, as the saga of DCEA and the firefighters – not to mention the entire 2009 MOU saga – show us, it is much harder to agree to terms during lean times.

No one wants to take concessions and receive less in the way of pay or benefits, but the cost of failing to agree leads to more future pain.

By having the increases capped by initiative takes away much of the uncertainty.  We would know that, during good times, we can increase pay and benefits, but the total compensation increase would not only be capped, it would be equalized, with no bargaining unit benefiting from lobbying and campaign contributions.

During tough times, concessions would be gained and city taxpayers would know that future budgets would be sustainable with limitations in growth and automated cuts.

In addition, there would be incentive for city employees to look for revenue enhancements, in the way of tax increases, special fees and also economic development.  The more revenue increases, the more city employees would get to share in the good times, as well as sacrificing jointly during lean times.

As a non-lawyer, I find it interesting to see if there is a way to legally tie future salary increases to increases in general fund revenues.

By making it a voter initiative, it would ensure that three votes on council could not overturn it.  Yes, the employee groups can lobby the public and campaign against this initiative, but, as we have seen, it is not clear that they have that kind of support in the community.

—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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8 thoughts on “Sunday Commentary: Examining an Initiative Limiting Future Employee Compensation Growth”

  1. Jim Frame

    [quote]What that would mean is that during good times, city employees would benefit from general fund revenue increases. They would be able to in future MOUs, receive the same total compensation increase as the city increased general fund revenue.[/quote]

    I get the cap part, but I don’t see a nexus between an increase in city revenue and an increase in employee compensation. They’re apples and oranges. Tying compensation to revenue instantly creates a cohort that will lobby for any development proposal perceived to increase city revenue. Do we really want staff acting en masse to push development projects?

  2. Mr.Toad

    Could it backfire and create a COLA kind of situation where people expect 2% a year as the tax base increases under Prop 13?

    I’m not sure initiatives are the best way to deal with pension short falls. Pensions are complicated and often with initiatives the devil is in the details. It would be better if elected officials addressed the problem instead of punting to the voters.

  3. Davis Progressive

    “I’m not sure initiatives are the best way to deal with pension short falls.”

    that’s not surprising. but i don’t think this is set up to deal with pension short falls, it seems a way to prevent public employee groups from exerting additional pressure on the city in the future.

  4. medwoman

    [quote]For the 2005-2009 MOU, the firefighters received an aggregate 36% pay increase just in salary[/quote]

    [quote]The police officers at the same time took a much more modest 17% increase, and most other bargaining units saw about a 15% increase.[/quote]

    A point of historical clarification please David. Prior to 2005, had there been any real or perceived discrepancy with the fire fighters making proportionately less than other bargaining units ? What was the rationale for such a large discrepancy in raises since I obviously wasn’t paying attention at the time ?

  5. SouthofDavis

    Jim wrote:

    > Tying compensation to revenue instantly creates a cohort
    > that will lobby for any development proposal perceived
    > to increase city revenue.

    Don’t forget that this will also make cops and firefighters want to raise revenue by giving out more traffic tickets and fire danger citations…

  6. Davis Progressive


    Don’t forget that this will also make cops and firefighters want to raise revenue by giving out more traffic tickets and fire danger citations…”

    questionable that you could raise enough revenue that way to make a difference. plus you have other checks and balances.

  7. SouthofDavis

    I wrote:

    > Don’t forget that this will also make cops and
    > firefighters want to raise revenue by giving out
    > more traffic tickets and fire danger citations…”

    Then Davis Progressive wrote:

    > questionable that you could raise enough revenue
    > that way to make a difference. plus you have other
    > checks and balances.

    The average cost if a cop gets you for a “california stop” (slowing but not comming to a “complete” stop) is close to $250 and a friend paid a $500 fire danger fine this summer for not removing enough weeds and pine needles from around his cabin in Tahoe.

    Just adding one roll through ticket an hour will bring in about a half MILLION a year per cop. If a firefighter gave out a half dozen extra fire danger fines a shift they would bring in over a quarter MILLION extra a year.

  8. Phil Coleman

    I can’t speak on how revenue through enforcement is distributed from the Fire Department. Past posts,however, has already detailed how little of that $250 traffic citation eventually makes its way to the city coffers. There are numerous surcharges attached to fine schedules that benefit other government entities and is never seen by a city. Even then, laws constrain how the relatively small revenue stream can be used by the city of enforcement.

    It can buy equipment needed for enforcement (e.g., citation books, parking enforcement vehicles), but an enforcement agency cannot be allocated any salary or compensation. This would be a conflict of interest, of course, and longstanding legislation has been in place to prevent that abuse. Yet, the myth persists that when cops write more tickets they benefit personally.

    While in the neighborhood, another myth is that cops like to write tickets. In reality, the vast majority of street cops don’t like to write citations and do so begrudging and only to placate their supervisor. Cops get enough confrontational situations in other roles and don’t seek out additional negative contacts if they can be avoided.

    Getting patrol officer to write citations is an ongoing supervisory challenge. Some cities even have MOU’s authored by police unions that prevent issuance of citations by non-traffic enforcement units.

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