It bears further reading.
Rob White posted the following:
I won’t disagree that there are many facets to this issue. But I will also note that most employees working for the City are not actively looking to ‘gouge’ the community. Maybe not all, but certainly most. I can only speak to what I witness every day.
Over the last 7 years, City staff have seen co-workers laid off, shifted to new roles, and retire early. Previously, the focus has been to reduce ranks to address the revenue shortfall. It is difficult to work in those conditions and maintain a happy countenance… Anyone who has worked in a financially struggling org knows how this looks and feels, and it’s not good. And employee morale is critical in delivering effective services, especially with reduced staff and revenue. So we arrive at the perfect storm of downward pressures.
As someone who only recently arrived in Davis, and who works with cities and counties across the State, I want to take a moment to note several points about the pensions, since this seems to be a topic often visited on this blog.
First, Davis is not out of the norm for most local government agencies. The calculation rates and retirement ages are commensurate with a majority of the 480+ CA cities, and are most certainly not an upper tier. Not even in the Sacramento region. The problem with current pensions is that EVERYONE (cities, counties, the State, special districts) ratcheted up the pension calcs during the late 90s and in to the early 2000s for two primary reasons – 1) competition with the dot bomb private sector to get and retain quality employees (which was futile anyway, but was a dramatic concern back then) and 2) CALPERS was telling all of these orgs that the cash machine of the stock market and land development increases would never run out… essentially, a world without end.
True, someone should have checked the accounting… but there was the problem, many of the brightest financial minds were being wooed to high paying jobs in the tech sector and those remaining were overwhelmed by the workload and scale. Actuarial tables should have been the core to decision making, but the grasshoppers were saying “no need to work, just come enjoy the summer sun!” Our state leaders were on board and it was a race to the top. We know how this turned out. It was colossal groupthink in the extreme and is now a common case study for failure points in many Public Admin programs… or how not to make financial policy decisions.
Second, pensions are primarily regulated by entities that are NOT under the control of the Council, senior management, nor employee. The only way any of the current Davis city staff (including exec management) can reset their pension calcs going forward (as everything earned to this point is a “right” that the state has made clear they don’t plan to mess with) is to quit public service all together. Even if a local government employee goes to another local govt org, most of us will be earning similar calcs (with only a few exceptions). This is due to the recent state pension “reform” rules which set the processes by which current and new employees earn their pensions. New local government employees (never worked in govt before) will earn less in their pension (in many cases) due to the second tier rates, but this also brings about a fairness discussion about the same jobs getting paid different amounts (even if base pay is the same, the pensions are very different).
In my own personal case (I don’t mind sharing), I came from a city using pension calcs of 2.7% per year of service times the highest single year. In Davis, I now get 2.5% (new state rules on existing CALPERS employees that switch cities) times highest single year. So a small decrease, but not one that is going to fix revenue shortfalls in any city or local government. My base salary remains the same over the entire 3 year period of my contract (No CPI). I now pay about $350 per month for a substantially smaller package of medical, dental and vision benefits than what I previously received. I also used to get $550 per month cafeteria benefit cashout, so we are talking real dollars lost to my personal budget of $900 monthly. Yes, you read that right… I get less calculated pension and took a $10,800 real dollar pay cut.
This gets at the heart of why I am explaining all of this… Why would I do such a thing? Because I believe that Davis has an incredible set of opportunities. I am often told (and I believe) that my skills are something that are a strong supplement to activities occurring in Davis and I bring a unique set of insights and networks to the task. I have the quals and broad accolades to prove that I know what I am talking about, and I am willing to take each and every challenge headon and weather the continuous cycle of second guessing and Monday morning quarter-backing that seems to be a main stay in Davis. I believe that the majority of City staff feel the same way. They want to work hard for this community and make Davis the best place on the planet.
I can share that the mood in City Hall today is one of relief. There is a palatable positive attitude change. Why? Because many of the people I sit near and work with daily now have a little more certainty in their lives about the future (at least for now) due to the passage of Measure O. Staff are noting that the majority of voters believed in them and are energized to prove that the money will be well spent. This is very different than a few days ago when it was a lot of breath-holding and stress. many now admit that they were certain they were losing their jobs.
See, the things we talk about here on the Vanguard and in the broader community dialogue affect everyone, even many that do not comment. The constant complaints about staff and their ‘bloated’ pensions becomes an increasingly heavy burden. Especially since they couldn’t change much of that, even if they wanted to. They came to Davis to work hard, have a career and agreed to a certain wage and benefits package as was comparable to other local governments.
Sadly, as Davis struggles to come out of the recession while other cities are already seeing their revenues return to pre-recession levels (and beyond), we will start to lose some of our best employees to other cities… because they will get raises for moving, possibly promotions, and above all else work for communities that are collaborating with their local government and working in partnership to make great things happen… instead of reading about how they are the reason that parks, roadways and bike paths are not being maintained.
I’m not trying to be an employee salary or pension apologist. Now that the majority of voters have given the City a short breather (and thank you to those that believed in us as employees enough to vote yes on Measure O), I am encouraging the community to discuss solutions based on universal facts and work with those that do have the ability to change some of the issues we face. Pension reform continues to be something that only our state leadership can really address, so continually focusing at the local level is like screaming in to a hurricane and expecting to be heard. And the City gets absolutely no value in having a pension percentage calc or retirement age that is out of alignment with surrounding cities because it just means that Davis would like to attract a lower than average tier of employee.
As you in the private sector can attest, you can’t offer substandard wages and benefits and expect to retain or attract the best and brightest. And a simple review of local government wages and benefits will show that the surrounding cities have either mostly caught up with or surpassed Davis’ wages and benefits. If you are bored, feel free to do your own unofficial salary survey by looking on the websites of the surrounding 10 cities that are comparable to Davis and see what their wages and benefits look like. You will see that in most cases, Davis is not the top and often not even the average.
Our fiscal crisis has resulted in many cities, counties, special districts, etc passing us by while we controlled increases and promotions. Sadly, I am confident that we will see the impact of this in the coming months as we see more and more staff departing to better pay, promotions and less community angst. It has already started and I suspect the announcements will become more frequent as the economy continues to heat up in places other than Davis. Just in Sacramento, there are (and will be) many opportunities as a result of the new arena and the surrounding infrastructure and projects (including a trolley, new bridges, office and residential, new retail… and yes, possibly even a third campus of UC Davis in the railyards or West Sac).
I am committed to trying to help the local dialogue become more constructive and positive. It’s what I can focus on and the only part of the equation I can truly lend help to. I believe in collaboration and partnership. While we tussle with each other in Davis, the region, and other cities (local and global) are getting the opportunities and offering to roll out the red carpet (even for our local businesses). Would it surprise you to know that Dixon and other surrounding cities are opening up strong dialogues with our local companies to try and get them to locate facilities and jobs in their cities? Companies that we have played host to and we deserve the opportunity to try and keep.
Of course, finding places for companies that are coming to do research and share technology with our university is also important. We are blessed with a unique opportunity, one I hope we can seize by using all of our previously spent energy that’s been focused on infighting to secure our financial future with the resources right under our collective noses.
Thanks for listening, I hope this has been informative and gives you a perspective that most don’t usually hear. Feel free to contact me privately at email@example.com to discuss how you might assist in a positive approach to our needed solutions.