Sierra Vista Can’t Afford Payraises Or Pensions

http://www.svherald.com/content/derek-jordan/2015/03/14/394730

Sat, 03/14/2015

SIERRA VISTAThe imminent issue of compensation for city of Sierra Vista employees was laid out in full for members of the Citizens Advisory Commission last week, highlighting one of the most daunting financial tasks the city is faced with as budget season approaches.

A study commissioned by the city council last year found that the base salary for the city’s full-time, hourly employees is 8.7 percent less than the market average. The discrepancy for base salary for senior management employees is even higher, 13.6 percent below market average.

Sierra Vista falls behind the farthest in public safety compensation, however.

The base salary for police officers working for the city is 19.3 percent below market value, while for firefighters that figure is 18.8 percent.

These figures were derived from information gathered from comparable cities across the state, including Lake Havasu City, Casa Grande, Yuma and Marana, as well as colleges and the Arizona Department of Public Safety.

“You can see why (city departments) have a problem, especially police, with retention,” said Liz York, chair of the Citizens Advisory Commission.

York and the six other members of the commission have been tasked by the city council to review the city’s various expenses and revenues before coming back with recommendations as to how best deal with ongoing financial woes. They have been meeting with department heads in weekly meetings since February.

The city now has to make a decision as to whether it wants to follow the recommendations of the consultant, who conducted the study. It recommends bringing up those employee wages that fall below the minimum market level to that bottom level, instituting regular pay raises for all employees and increasing pay for all employees by 2 percent for each full year of service, based on the current market level.

The total estimated annual cost of implementing such changes, including benefits, is approximately $1.09 million, about half of which is for public safety employees.

Also at issue, however, is the looming increase of employer contributions to the state’s Public Safety Personnel Retirement System, which itself is estimated to be $612,262, a cost which is expected to increase each year, said City Manager Chuck Potucek.

“So a good two-thirds of the cost of doing this hits public safety squarely,” Potucek said.

The other side of that coin is that the police and fire departments have not had their staff limits reduced throughout these financial hardships.

“They have been kept whole throughout all this. All the other departments are the ones that bore the cuts of personnel,” he said.

Staff reduced by 1/4

Quick response to the recession kept the city from having to lay off an employee. But it has seen its full-time staff level fall to just over 300 people, nearly 100 fewer than its peak in 2008.

The city also has more than 200 part-time employees, said Barbara Fleming, human relations manager for the city.

As a result of these lower employee levels, the city has fewer options when it comes to promoting from within to fill management level positions left open by retiring employees. Promoting from within typically saves the city money because it would otherwise have to advertise the position at the higher market value salaries.

“I can’t replace that 30-year person at the same salary anymore, I have to pay up. I’ve already seen that in a couple positions already. So I know that’s going to happen, unless we’re fortunate enough to replace those people from within,” Potucek said.

Noting the cost of implementing these changes, commission member Jeff Anselmi inquired as to whether they could be implemented piecemeal instead of all at once.

“The reason we need to implement at one time is, if we adopt the new class and comp study, then when we hire new people in under that, we end up with the issue of new hires coming in higher than existing employees. We also increase the problem of compression, where employees that have been in position for five years are now making the same or less than an employee that’s just coming in under the new class and comp study,” Fleming said.

Adding to that, Potucek said, is a perception problem among employees as to whether the city can fulfill its obligations of an annual step increase in wages, since the city hasn’t given raises in six of the last seven years.

“So I think, with the implementation of a step plan comes the expectation that you’re going to fund that step each year, and over the last seven years. In six of them we didn’t do that. So we can’t offer any guarantees. There are no guarantees,” Potucek said.

Commission member Clyne Namuo summarized the issue thusly, “This the result of cumulative human resource deferred maintenance.”

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