News

Palo Alto's employee spending went up in 2013

Data shows that despite benefit reforms, overtime reduction and overall compensation for city workers has gone up

Palo Alto's spending on employee salaries and benefits rose by $2.4 million between 2012 and 2013, despite the city's generally successful efforts to curb the rising costs of benefits and reduce overtime, according to data city officials released Monday.

The data, which the city released on its OpenData platform, indicates that while the city has been successful in dealing with the problem of rising pension and health care costs, its actions have come at a price. Benefit costs still increased by 2.3 percent between 2012 and 2013, though the rate is far below the 8 percent growth in benefit expenditures that occurred between 2011 and 2012. In exchange for greater contributions by employees for health care and pensions, management agreed to raise workers' salaries, a tradeoff that resulted in a $2.4 million increase in overall compensation.

The increase in pay came despite a lower headcount in the city's workforce. The number of workers (including temporary employees) went down from 1,622 in 2011 to 1,560 in 2012 to 1,522 in 2013. After decreasing from $137.6 million to $137.4 million between 2011 and 2012, the city's total spending on salaries and benefits rose to $139.7 in 2013.

City officials highlighted a decrease in the number of employees making more than $80,000 in overtime, from five in 2012 to zero last year. Whereas in prior years, the list of top ten earners was dominated by police officers and firefighters with sizable overtime sums (in 2011, 12 out of 15 top earners were public-safety workers), in 2012 it was mostly top managers and department heads that topped the list. The trend held in 2013, with City Manager James Keene and Assistant City Manager Pamela Antil topping the earners list with total compensations of $264,689 and $238,433, respectively. They were followed by Utilities Director Valerie Fong ($226,884), Chief Financial Officer Lalo Perez ($225,622) and Police Captain Robert Beacom ($222,947).

In a particularly dramatic departure from the past, only two members of the Fire Department were among the city's 20 highest earners. Only Fire Chief Eric Nickel, who received $199,122 in total wages in 2013, was ranked in the top ten (he was tenth). As recently as 2011, eight of the top 20 wage earners in the city were firefighters, including six of the top 12. In most cases, overtime made up a large share of the total wages in public safety (in several cases more than $100,000).

The city's overtime expenditures have since dipped substantially, partially as a result of the city's abolishment in 2012 of the minimum-staffing provision in the firefighter union's contract. The clause, which had required the city to have at least 29 firefighters on duty at all times, helped drive up overtime costs.

Even though there were no six-digit overtime earners in 2013, in several cases overtime earnings totaled more than a third of an employee's salary. Adrienne Moore, a police sergeant, took in $75,266 in overtime in 2013, which brought her salary up to $214,029, while Fire Captain Ryan Stoddard took in $78,479 in overtime, bringing his total wage to 193,989.

At the same time, even though employees' salaries have generally risen, the number of employees making more than $200,000 dipped in 2013. There were eight officials whose salaries were above that threshold in 2013, seven fewer than in 2012 and 14 fewer than in 2011. Meanwhile, the number of employees who made more than $100,000 jumped by 36, from 372 in 2012 to 408 in 2013.

Comments

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Posted by Wayne Martin
a resident of Fairmeadow School
on Mar 3, 2014 at 9:11 pm

> management agreed to raise workers' salaries,

Once the salary base for the City gets to be about $100M/year--then a yearly average wage increase of 2% will increase the salary base by $2M/year and a 3% average salary increase will result in a $3M total salary increase.

The fact that salary increases were approved meant that the salary portion of the City's compensation costs were going to go up by the amount of the salary increase. This is not magic--just simply 7th grade math.

> the number of employees making more than $200,000 dipped in 2013.

This could be because of reduced overtime, or it could be because some of those making more than $200K/year moved on to another employer, or retired. So--which is it?


 +   Like this comment
Posted by Silly
a resident of Embarcadero Oaks/Leland
on Mar 4, 2014 at 10:25 am

Since when do such highly paid employees get any overtime at all?? Only in the public sector.

Do they get bonuses for cost overruns and lawsuits on construction projects, too?

Never again will I vote for a city bond issue. And remember that when you turn 65 you can get a rebate on the school parcel tax. A small drop in the bucket against $80K in overtime pay but still....

How long does it take these geniuses to fix a traffic light? 8+ years and still counting.


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Posted by Resident
a resident of Another Palo Alto neighborhood
on Mar 4, 2014 at 10:36 am

Don't forget the pension/healthcare component. A six-figure city pension over 30 years, adjusting for inflation, is worth $3 million. Plus you don't have to wait until 65 to get it.

No wonder the City wants a bond issue.


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Posted by 35 year resident
a resident of Old Palo Alto
on Mar 4, 2014 at 11:16 am

Anyone ever heard of a Wage Freeze? Perhaps it's time to elect a city council that will put a stop to the ridiculous spending on city employee salaries, overtime and benefits. They'll vote to raise taxes on hotels to a ridiculous amount to help fund their exorbitant and foolish spending, but they don't have the intestinal fortitude to stand up to the city employee unions and say "No More." Vote them all out and send a message that we've had enough.


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Posted by pleased
a resident of Adobe-Meadows
on Mar 4, 2014 at 12:45 pm

Pleased indeed to see the abolishment of the minimum-staffing provision; and I'm pro-union.
Overtime pay is going to bankrupt us.


 +   Like this comment
Posted by Jeff
a resident of Duveneck/St. Francis
on Mar 4, 2014 at 12:58 pm

With roughly 60,000 residents the city budget for employees is $1,683 per man, woman, child ($6733 for a family of 4). We sure are a hard bunch to manage.


 +   Like this comment
Posted by Corey Levens
a resident of Green Acres
on Mar 4, 2014 at 1:12 pm

If 12 of the top 15 overtime earners were public safety or other workers, the Online goofballs would be apoplectic over our gluttonous unions. There's a noticeable silence, though, when the top earners are on the administrative staff. I guess the real issue is not how much is being paid but who's getting it.

And to echo Silly's comment, why are top managers being paid overtime?


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Posted by jerry99
a resident of Barron Park
on Mar 4, 2014 at 1:16 pm

Time for wage cuts. In businesses, that is companies that make things and sell them, overtime is not paid and accrued sick leave is not paid when the employee retires. And any non wage component of pay is not used to calculate pensions. And retired employees pay for health care costs.
Time to stop this welfare state for municipal employees. They make as much money as in the private sector, but do not work nearly as hard as private company employees. Time to reign in the "good life".


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Posted by David Pepperdine
a resident of Another Palo Alto neighborhood
on Mar 4, 2014 at 3:19 pm

Only in Palo Alto would a a $2.4 Million dollar increase be considered a "successful effort to curb the rising costs of benefits and reduce overtime."

One wonders what failure would look like... heh.


 +   Like this comment
Posted by musical
a resident of Palo Verde
on Mar 4, 2014 at 3:39 pm

Doesn't the Wage & Hour Act still dictate overtime? Unless you are exempt. Canning peaches down at Libby's I always got paid 48 hours straight time and 12 hours time and a half for those six 10-hour days each week. Plus shift differential on swings. Good Teamster's Union job.


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Posted by John
a resident of Barron Park
on Mar 4, 2014 at 4:44 pm

I think a $200K/year employee should not get overtime. What number do other people vote for?


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Posted by casey
a resident of Midtown
on Mar 4, 2014 at 5:14 pm

Almost $60k for meter readers?


 +   Like this comment
Posted by Incompetent city staff
a resident of Old Palo Alto
on Mar 4, 2014 at 7:19 pm

Let's begin trimming salaries by firing City Manager Keene. He is ineffective and completely out of touch with the citizens he represents. He also hires a lot of incompetent staff, as is witnessed by listening to the staff speak at city council meetings. Their incomplete, error filled reports make me cringe.


 +   Like this comment
Posted by JQPublic
a resident of Crescent Park
on Mar 5, 2014 at 5:55 am

[Post removed.]


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Posted by Silly
a resident of Embarcadero Oaks/Leland
on Mar 5, 2014 at 10:51 am

Many private sector companies routinely classify very low-level workers as managers specifically to avoid paying them overtime even though they're only one or two rungs above minimum wage.

I'm not defending that practice for $30K a year workers but Palo Alto sure does the opposite. Shame on the city where we have police dispatchers making $300,000, with 1/3 of it overtime. I guess she gets a bonus for rudeness, too.

The city really needs to come to grips with this type of absurdity.


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Posted by Alphonso
a resident of Los Altos Hills
on Mar 5, 2014 at 11:54 am

Is this really news? Less headcount and a 1.7% increase in overall compensation sounds like costs are being contained. I doubt you can find any business in the county having a 1.7% increase in compensation/benefits - unless you pick a failing business. Did The Weekly do better?


 +   Like this comment
Posted by Rico
a resident of Los Altos
on Mar 5, 2014 at 1:05 pm

Web Link


 +   Like this comment
Posted by Days off
a resident of Midtown
on Mar 6, 2014 at 2:25 pm

The libraries automatically add a day on to every holiday so for example, they are closed 2 days for every one day holiday.


 +   Like this comment
Posted by Ur misguided
a resident of another community
on Mar 6, 2014 at 5:35 pm

Everyone is distracted from the real money drain. Residents are not looking at where the majority of the salaries are going - top level management. How many top level managers has keene hired in the past 3 years? How many of those new hires are in positions that never existed before? Why does keene need them when past city managers didn't? How are the new hires tied to keene? What is their benefit package? Why do at least 5 top level positions receive city paid deferred comp?

Why do employees have to work overtime? Because managers don't. There are not enough employees to cover the workload. It's difficult to work more efficiently when you are doing the same work that 2 or 3 people used to do. The City has downsized staffing by 30% while increasing workload, programs and services. Oh and btw the 9 days in two weeks still equates to 80 hours. The same as 5 days a week.

It's easy to read the paper and make assumptions based on story selling because we all feel the economy crunch and we want everyone to share our pain. But do some investigating on your own before you drink the koolaide!!


 +   Like this comment
Posted by Wha?
a resident of Another Palo Alto neighborhood
on Mar 6, 2014 at 5:50 pm

Comparing apples to apples?

Web Link

compare with web link from Rico.


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