Sunday Commentary: New City Manager Salary Puts Davis in Tough Spot

New City Manager Dirk Brazil will received $217,200.
New City Manager Dirk Brazil will received $217,200.

Back in July, the Vanguard argued that the “Council Did Right Thing on Compensation.” As we wrote on July 19, 2014: “The council has clearly waded into perilous waters by increasing the salary component of the city manager’s total compensation, but it is not clear to me that they had much choice. It doesn’t take a lot of imagination to read through the lines that if they are asking for the increase in the salary compensation level at this stage of the process, they otherwise were not going to get the city manager candidates they wanted.”

“The data here speak for themselves,” the Vanguard commentary continued. “Davis is at the very bottom in the region in terms of salary. The consultants recommended a range of salaries that put Davis between the mean and the 75th percentile.”

There was the convincing chart which showed the city of Davis at the bottom:

CM-Compensation

Based on that staff report, the council voted to “establish a salary range of the City Manager position up to a range of $217,200 to $241,300, with appointment to be made within the range based upon the qualifications and employment history of the individual appointed to the position,” and “establish a limit of up to 10% for additional monetary benefits (in addition to health/dental and PERS retirement benefits), to be negotiable.”

As the staff report noted, “Working with the guidance of the Recruiter, staff conducted a labor market analysis of certain cities within an approximate 60 mile radius of Davis to determine the city’s competitiveness in the marketplace. Based on the survey information it is evident that the city’s medical/dental and retirement benefits are comparable to other cities in the region. The area where Davis is clearly not competitive is salary and additional cash-related benefits (i.e. deferred compensation, PERS pickup and auto allowance).”

But that staff report only told part of the story. It failed to capture what had happened with city manager compensation since 2009.

CM-Salary-ComparisonA quick glance at seven of our regional neighbors shows that Woodland was the only other city besides Davis to increase its city manager salary since 2009. Woodland increased the salary following the hire of Paul Navazio, from $181,135 to $191,760, just over a $10,000 raise or a six percent increase. Davis’ increase is nearly three times that.

The cities of Lincoln, Rancho Cordova, Rocklin, and Roseville all reduced their salaries by more than eight percent.

Is that a huge problem? It could be. Unlike a lot of other cities, the city of Davis is not out of fiscal crisis yet. We just had to pass a sales tax increase to close what had been a $5 million structural deficit, but as our readers are well aware, that is the tip of the iceberg. First, the structural deficit is expected to continue to increase, even with the sales tax, up until 2018.

Moreover, the city faces huge infrastructure costs to repair things like roads, bike paths, greenbelts, parks, sidewalks, and pools. One of the first new tasks of the city manager will be to assess the fiscal situation and help the council arrive at a course of action on a potential parcel tax or other revenue measure.

Furthermore, the city in the next 12 to 18 months will be looking at getting voter approval on innovation parks, which the city hopes will generate new tax revenue into the future.

The city is now going to have to explain to voters how they are in fiscal crisis and yet can afford to pay the next city manager $217,200 in salary, a 16 percent increase over the previous city manager. Moreover, in this case, we are hiring a local resident who was previously making $166,000 at his current place of employment as the Assistant County Administrator for Yolo County.

Mayor Dan Wolk back in July noted that “[this is] during a time of budget crunch and we are getting concessions from our existing employees,” and he believed that was an important point.

Nevertheless, in the end, he agreed with the consultant. “I will support this,” he stated. “Having a really good city manager can make a huge difference.   It is clear from the data that we are significantly below… other cities.”

“To get good people, salary is a critical part of that,” he continued. “Even though we’re in a period of tighter budget, even though we’re in a period where we’re making concessions… I think that it’s important that we have a good city manager at the helm.”

He said he hoped that the city employees would understand that a greater salary would give the city someone who can be a good city manager and be very good on employee morale issues.

But will they understand? The current round of Collective Bargaining Agreements expires in 2015, either in June or December depending on the bargaining unit. Given the city’s fiscal situation, it is more likely than not that the city will have to ask the employees to take another round of cuts, particularly since the voters will have been asked to pass two taxes and innovation parks to fund city government.

The Davis City Employees Association (DCEA) has fought the city in each round, going to impasse twice – once prevailing in front of an administrative law judge. In 2013, they went to impasse again, along with the firefighters’ union.

The city was unable to reach agreement with DCEA and a unanimous council voted to impose the last, best and final offer. The result was that the cafeteria cash out went from $1738.44 per month to a maximum of $500 per month, and the employee PERS (Public Employees’ Retirement System) contribution went from 0% to a full 8%. Because the contract was imposed, they are on a yearly contract, and the city was unable to impose a second tier like they did with the five bargaining units that agreed to those terms.

Parks-Maintenance-SalaryA typical DCEA salary might be the Parks Maintenance Worker, who earns $49,034.34 per year (Source). While the salary was ultimately not touched in the imposition, the position effectively took as high as a $19,000 per year pay cut, as the cafeteria cash out was reduced drastically, and now such an employee has to pay nearly $4000 for PERS benefits.

Remember, DCEA employees had the highest rate of taking the cafeteria cash out and the highest rate of taking the full benefit.

So, while the lowest paid workers in the city effectively received a 27 percent pay cut through imposition, and now may be asked to take on additional concessions – or lose their jobs as nine of the employees did in June of 2012, the new city manager – who makes more than four times their salary – is personally getting a $60,000 raise (more than the Park Maintenance Employee’s total compensation).

Steve Pinkerton often told me that had he taken a salary increase when he was hired, it would have been impossible to get the rank and file to take concessions.

It may be impossible now, anyway. One of the lessons that we can learn from DCEA is that you benefit from not agreeing to terms. So, while five bargaining units took concessions by December 2012, DCEA and fire held out and received an extra year of salary at the previous rate, and because DCEA held out in 2010 and prevailed in 2011, they received 2009 rates through the end of 2013 while the other bargaining units had conceded to cuts twice.

We have yet to see the numbers, but it seems that the new salary puts the city in a difficult spot, both politically in terms of passing a parcel tax and fiscally in terms of getting employees to agree to new rounds of concessions.

If the council attempts to avoid the problem by holding the compensation at current levels, they risk a backlash that could threaten the possibility of passing the parcel tax.

The city faces a huge political mess here and, in part, this is on city staff and their consultants in failing to provide the city council with full information on what is happening with salaries across the region.

—David M. Greenwald reporting

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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41 Comments

  1. Barack Palin

    Isn’t it a little late for this article now?  The horse is already out of the barn.  Many posted on here that the $188,000 was more than sufficient to get a new CM.  Raising it only made sense if we were able to persuade a good CM from another city with a great track record to uproot and come to Davis.  That didn’t happen, instead we have someone local who will be learning on the job and I’ll bet the $188,000 would’ve been enough to lure him.  Yes this is going to make it even harder to pass parcel taxes and get concessions from the unions.  What a quandry, if the city doesn’t get concessions (especially from the firefighters) there will be a backlash from the citizens over parcel taxes and accusations that the unions got their man and if the city does try and get concessions the unions are going to throw this 16% pay raise right back in their face.

      1. hpierce

        It is quite logical to assume, that if the CC NOW reduces the salary to $188k, AND keeps the other provisions the same (including prospects of further reductions in salary and benefits), this ‘deal’ is undone, and we will resume the search, now with a CC track history of making an offer, significantly reducing it at the last minute.

        Not necessarily good or bad, but what IS.

      2. sisterhood

        The salaries in your article are interesting, but don’t reflect populations that have many students who live on campus and do not need as much management as citizens who do not live on campus. I wonder how much the city manager in the town of Chico is earning.

         

  2. Bill

    I’m not sure it will make a difference regarding the parcel tax.  People on the VG are engaged as are readers of the Enterprise, but outside of that, I’m not sure how wide spread people are even paying attention to this.  For the vast majority of people, I don’t think this is even a blip on their radar.

    Personally, even with knowing the compensation information, I’m not swayed one bit from approving a parcel tax.

    1. David Greenwald

      Well it depends on what develops in terms of an anti-parcel tax campaign. If it’s Jose Granda and Thomas Randall, then yeah, won’t matter. If a more credible group arises with resources, it could get dicey.

  3. Barack Palin

    So while the lowest paid workers in the city effective received a 27% pay cut through imposition

    Only some of the lowest paid workers took a 27% pay cut.  If they chose to stay on medical coverage their cut was much less.  Do you have the actual numbers of how many gardeners actually opt for the cash out?  Anyway, a gardener who makes $49,000/yr. base salary plus benefits puts them near $70,000/yr.  Not bad for a gardener.

    1. sisterhood

      Gardening is a very physical job, which takes its toll on one’s back and knees. I have no problem with a city gardener retiring and having a decent retirement benefit. If they do not have a decent wage in retirement, the taxpayers will pay to care for the gardener in other ways, especially their medical costs.

       

       

    2. Dave Hart

      $49,000/yr base salary means that employee takes home something like $2,700/mo.  How could anyone out there possibly begrudge a city employee $2,700 to make their monthly bills?  Go bark up another tree.

      1. Barack Palin

        Dave Hart, who’s begrudging gardeners of a $49,000/year salary?  I just said it’s a good salary for what they do.  $49,000/year, plus 15 vacation days, 12 holiday plus 2 1/2 floating days off, 12 sick days, medical and other benefits plus a cash out option and retirement system.  How many garderners do you know that make that much plus the benefits working for a lawn care company or a landscaper?  Being a gardener for the city of Davis is a well paid job for what they do.  Maybe it’s you that needs to find another tree.

        1. Barack Palin

          That’s only if they decide not to take the medical benefits.  So that most likely means that they already have medical through their spouse.  Do you think any public employee should be given a cash out of $20,000 a year just because they’re lucky enough to already have medical through their spouse while the person working next to them gets no cash out because they have to use their funds for a  medicical plan?  The person who has insurance already and uses the cash out still comes out $6000 ahead of the employee that doesn’t.

        2. Davis Progressive

          should they in theory?  no.  i support removing that benefit, but at the same time, if you are getting that benefit for the last ten years, and now it’s gone, it’s still a huge pay cut.

        3. Dave Hart

          Palin, the implication of your posts is that they are paid too much.  I don’t think they are.  I also get the feeling that you feel there is room to cut the wage package generally.  I don’t think WalMartizing our city workforce is good policy.  I want a workforce that can see themselves as professionalized including the lower skilled workers.  If the wage package is cut to the bone, you can bet that the people who advocate this minimal wage package policy will be the first to complain about the poor quality of the workforce and bad morale and then use that as a rationale to outsource public services.

  4. Don Shor

    Maybe he can reduce some of the administrative overhead. We keep hearing that there’s going to be an exodus of employees, presumably at upper levels. Consolidating a couple of positions and reorganizing things could easily yield enough overall cost reduction to cover his salary increase.

    1. Gunrocik

      You are bringing in a political operative to run the City — no experience at all working  at a city.  He isn’t going to have a clue as to how to reorganize and given his lack of experience, he is going to need people with the actual knowledge around him.  In reality, he is going to need more people around him, not less.  If they had hired someone who had done this before, that likely would not have been the case — and that might have also justified paying someone more as well.  Instead, they’ve brought in a rookie and they are paying him like a veteran.

  5. Michelle Millet

    Based on the survey information it is evident that the city’s medical/dental and retirement benefits are comparable to other cities in the region. The area where Davis is clearly not competitive is salary and additional cash-related benefits (i.e. deferred compensation, PERS pickup and auto allowance).”

    Was this the situation when Pinkerton’s, or other past city managers salaries were determined. (i.e. Davis’ compensation rate was not competitive?)  If so, my question would be why  is it an issue now?

  6. Michelle Millet

     

    Consolidating a couple of positions and reorganizing things could easily yield enough overall cost reduction to cover his salary increase.

    Is it necessary to increase the city manager’s salary in order to consolidate a couple of positions?

  7. Tia Will

    We keep hearing that there’s going to be an exodus of employees, presumably at upper levels”

    I would be interested on what is the driving force behind this purported exodus. It would be one thing if the exodus were due to perceived lack of leadership during the tenure of the acting city manager. It would have entirely different implications if it were due to uncertainty because of the perceived attempt at ouster of Mr. Pinkerton. And quite another if the “exodus” were due to salaries being significantly lower than those offered in other attractive communities.

    If indeed there is such an “exodus” brewing, wouldn’t it be nice to know what is behind it…..if indeed it is not just a random cluster of people leaving for a variety of reasons such as family considerations, love of a particular area, employment opportunities for a spouse…..

    And all of this depends of course upon this rumor having any truth behind it.

    1. South of Davis

      Tia wrote:

      > I would be interested on what is the driving force behind this purported exodus.

      The only thing that is going to drive an “exodus” of city workers is a change in the pension system.  I just found out that a firefighter friend retired in his early 50’s before he got the max 90% at 30 years because next year he would not be able to tack on his unused vacation payout to his last years pay to calculate his pension (that will probably pay him even longer than he worked as a firefighter).

      I’m happy for my friend that is “retired” in his early 50’s making over $200K (about the same as what the former Davis Fire Chief “and” her husband are making in their 50’s).  Maybe 2/3 of Davis resident are OK voting to raise their sales tax and/or the parcel taxes every year to pay for high salaries, amazing benefits and unbelievably generous pensions for “public servants”, but the more “public servants” we have making over $200K the harder it will get (for even the most liberal) people to keep voting for tax increases…

      1. sisterhood

        Not sure how your firefighter pal rec’d such a large pension in his 50’s.  Are you positive about these numbers? I’m a PERS retiree in my late 50’s and receive approximately 65% of my salary, with 25 years of service. (None of my overtime was calculated into my retirement.) Your figures seem a little high, but maybe my job was calculated differently from the safety workers’ jobs.

         

        1. South of Davis

          sisterhood wrote:

          > Not sure how your firefighter pal rec’d such a large

          > pension in his 50’s.

          He is a 3% at 50 guy (like every other cop and fireman I know)

          > I’m a PERS retiree in my late 50’s and receive

          > approximately 65% of my salary, with 25 years of service.

          Take a look at the CalPERS link below there are more than a dozen ways to calculate what you get (from 1.25% at 67 to 3% at 50).

          If you want to read about people making even more than my friends Google: Public Safety Pension Spiking

          http://www.calpers.ca.gov/index.jsp?bc=/member/retirement/service-retire/benefit-charts/stateformulacharts.xml

  8. Barack Palin

    David, didn’t you advocate for higher CM pay?

    Why are you now questioning the higher pay?

    Didn’t you see at the time that higher pay might create the problems you’re now writing about?

    Do you think the higher pay got us a better qualifed CM?

     

     

    1. South of Davis

      BP wrote:

      > Do you think the higher pay got us a better qualifed CM?

      Any idea what Dirk was making in his last job?

      Since he can now ride his bike to work (saving the $0.50/mile driving to Woodland 5 days a week) he will be at least a couple grand ahead every year (and get in better shape).

      Just like I didn’t think we needed to pay Janet Napolitano $570K  to come to UC (about $370K more than she was making in her last job) I wonder why we would need to pay Dirk a lot more to come to Davis (or more than the Governor of California makes)…

    2. Davis Progressive

      did you read the article?  very first words, “Back in July, the Vanguard argued that the “Council Did Right Thing on Compensation.””  he then explains his concern: “But that staff report only told part of the story. It failed to capture what had happened with city manager compensation since 2009.”

      so the city used one set of data without showing the big picture that compensation for city managers has been declining.

  9. Mark West

    The more I think about this hire, the more convinced I am that this is just the first step in a process designed to roll back most, if not all, of the fire department reforms that have been put in place over the past couple of years.  I expect that in the very near future we will see an attempt to re-examine boundary drop, shared management and the number of firefighters on an engine, all driven by the desires of two or three CC members with sights on higher office.

    The question we all need to ask now is are we willing to allow this to happen?

    I do not know why Robb Davis abstained on the CM vote, but it doesn’t take a Ph.D. to understand that the City is coming back under the control of the very same political operatives who helped create the fiscal mess that we are only now starting to clean up. I look at Robb’s abstention as a warning to us all of what is coming down the pike.   Instead of slamming Robb for his decision, start to think about what the selection of this CM says about the future of Davis.

     

    1. Davis Progressive

      “The question we all need to ask now is are we willing to allow this to happen?”

      the question that we all need to ask is how did this happen?

    2. Frankly

      After conversing with somebody I admire having good insight into city politics, I think the situation we find ourselves in with the new firefighter union-friendly CM is study in the power and value of community organizing.

      Let’s look at this from a networking perspective.  40 firefighters should not wield so much political influence.  But like the Muslim Brotherhood, they are strongest organized network in their locality.  Each firefighter connects with his/her family and friends, and to the general public sector union labor community.  How many voters comprise this network?  Now ask yourself what is the next most voter-powerful network.  The open-space network?  The people against growth network?  The anti-law enforcement network?

      How about the fiscal prudence network?  Doesn’t exist does it?

      That was my epiphany tonight… all of us that desire a city that lives within its means while providing top-level services and amenities to the general population and not a privilege 41 city employees…  we need to organize.  We need to create a network that serves to make the voice of the others relatively powerless by comparison.

      This is something that I am committed to start working on.  Anyone else?

        1. Frankly

          Davis has a larger share of public-sector employees… some of them union and some not.  I think there is sizable network of sympathizers.

          I have a friend that just retired from his federal government job.  He was a right-wing conservative dude when I first met him.  Now he is a full-on Democrat.  People tend to vote from a perspective of where their bread is buttered before they vote for the big picture.  I think the firefighters have enough support from voters whose livelihood is from, or connected with, government compensation policies.

          Liberal or conservative from an ideological point of view, there are a lot of people posting on the VG that seem to be on the other side of this continued madness of grossly over-compensated city employees.  The problem is that we don’t do a good job sounding as one voice.  That needs to change.

      1. Don Shor

        As to your political proposal, I think the best bet is to continue to seek out and support candidates who are independent of the local Democratic Party inner circle, and who have no connection to the unions. It needs to be recognized that the school board is often considered a stepping stone to the city council. While we have an independent council majority right now, I think those who supported the ‘old guard’ feel that they have an opportunity to reverse some of the reforms that Pinkerton and the previous council implemented.
        I suggest the Vanguard and the public pay close attention to the appointments to key commissions over the next few months as terms expire. There are two vacancies on the Finance and Budget Commission, and two commissioners terms have expired.

        1. Mark West

          Don Shor:  ” I think the best bet is to continue to seek out and support candidates who are independent of the local Democratic Party inner circle, and who have no connection to the unions.”

          In this case I doubt this approach will be sufficient.  We clearly have two CC members who are willing to give the unions what they want, and another who dislikes the appearance of disagreement so much that they are unwilling to stand against the perceived power. If the three vote together they can undo everything that has been gained in the past few years.  That being the case, we cannot wait until the next election as the damage will already have been done.

          If the CC brings up the issue of revisiting any of these reforms, the response should be the preparation for a recall action.  If any of the reforms are actually reversed, then all those who voted in favor need to be removed from office at the earliest possible opportunity. We need to make it clear to the members of the CC that we will not stand for this nonsense, and that we will support those CC members who are willing to stand up to the pressure.

          The reforms to date are only a start.  We need to further control our expenses and work towards a comprehensive solution to our fiscal problems. Going backwards is completely unacceptable.

      2. Gunrocik

        We need to work on taking back our community — but let’s start Frankly by getting you committed to a 12-step program for extracting the cable news network partisanship out of your system.  One of the reasons I enjoy following local government is because the red and blue labels don’t fit as neatly at the local level.   Yes, we do have a small group of blues in this town trying to shove their ideology down our throat — but we don’t need to turn employee compensation, bag bans, MRAPs, water wells, road diets, innovation parks, greenbelts and Measure R into partisan issues.

        Let’s just boil these things down to those things that we agree with and those we don’t agree with–most of our issues do cross party lines.  Growth is more of a generational issue in this town that it is a ideological one, you have both far left and far right opposed to police tanks–and I think there are just as many liberals as conservatives offended by our fire department myopia when it comes to compensation.

        I think you will get a bigger tent of supporters for fiscal reform in this community if they don’t have to take an ideological purity test first.

        By the way, after a decade here — I’ve found it in many ways to be the least progressive college town I’ve every lived in.  Seems like we had a couple of student radicals take over the Council and get a couple of bike paths 45-50 years ago and we’ve been living off that progressive lightning bolt ever since.  Staid places in the Midwest like Iowa City and Champaign seemed far more cutting edge to me than “keep of my grass” and “don’t make me pay for water” Davis.  In fact, the only thing I’ve found more impotent than the progressive movement here is the nearly non-existent business community.  Why aren’t they taking the lead on the Innovation Park — why aren’t they having a meltdown over runaway city budget deficits–why are they supporting Council candidates such as Wolk and Frerichs who are part of the “machine” that created our budget mess in the first place?

         

         

         

         

         

        1. Frankly

          Yes, we do have a small group of blues in this town trying to shove their ideology down our throat — but we don’t need to turn employee compensation, bag bans, MRAPs, water wells, road diets, innovation parks, greenbelts and Measure R into partisan issues.

          Well, I don’t think all of those issues are partisan… and maybe you are correct that we don’t need to turn the others into partisan issues.  Years ago I was like most Davis voters… too busy to pay much attention to local politics and comfortable thinking that this most educated little city in the world would do well managing its affairs.  But then later I had to ask how and why all these very smart people had dug the city into such a hole and then kept digging.  And my conclusion was that politics and ideology/worldview was a major source of the policy dysfunction. How else can you explain it?

          And if politics and ideology are a source of our dysfunction, then we won’t solve any related problems tiptoeing around the topic.

          But I agree that I tend to go partisan too often on subjects that don’t warrant it.

           

  10. Gunrocik

    Bingo!  I am amazed that there hasn’t been one Finance and Budget Committee member or any member of the business community warning of the slippery slope the Council is about to ride down!  Apparently by making it a local hire, it creates a smoke screen that the critics fail to see through—despite the fact that the local hire is directly tied to all of the cronies who put us in this mess.

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