After two years of big budget cuts and a wave of employee retirements, Palo Alto's shrinking staff is struggling to keep up with growing demands, City Manager James Keene warned the City Council Saturday at the council's annual retreat.
Some staffing areas resemble Swiss cheese, with holes representing major staff vacancies, Keene said in one of several metaphors he used to describe the challenge. But an iceberg with a growing base best describes the increasing workload city workers face.
The retreat this year was held at the Baylands Nature Intrepretive Center at the end of Embarcadero Road, framed by the city's marshlands.
Historically, the retreat is used to set priorities for the year. This year, the council decided to carry over all five 2010 priorities: city finances, environmental sustainability, emergency preparedness, community collaboration for youth well-being, and land use and transportation planning.
The council briefly discussed each priority and heard from Keene how staff is addressing them.
But the dominant theme of the day was how to get by with a smaller staff.
The city has cut 40 positions this fiscal year and 20 the year before, Keene said. The General Fund currently funds 579 positions, Keene said, compared to about 730 in 2003. In addition, 46 of the funded positions are vacant, he said.
"When we have budget problems, I do drag my feet on filling those to help us manage through the budget year," Keene said.
The number of employees working on "strategic" issues has also shrunk. Keene said Palo Alto had about 66 such employees last year and 55 this year. Some opted to retire after the city modified its benefits to require greater pension and health-care contributions from employees.
"We have some shrinking capacity with the fiscal environment and we have a lot of demands," Keene said. "How we manage these things and improve people's perception is going to be a challenge."
Council members suggested various ways to function with a smaller staff.
Gail Price suggested that Keene point out on each report how many people, hours and departments it would take to carry out a particular function.
Pat Burt said the city should consider which items on the city's workload are true priorities and focus on those. He singled out the downtown farmers' market, which the council initially subsidized at City Hall but later turned over to a nonprofit group.
"Try to identify what are the actions and activities by staff that had the least value," Burt said.
Keene also pointed to the city's many accomplishments in 2010. Those include improving labor relations, assisting with Project Safety Net, making progress with the Comprehensive Plan, and emerging as a regional leader on high-speed-rail concerns.
The city has had a very successful year, he said.
He highlighted some issues that will consume large chunks of staff effort and time this year. They include familiar topics such as the $3.5 billion expansion/rebuilding of Stanford University Medical Center, which the council plans to rule on in April.
He cited progress on the Comprehensive Plan (the city's guiding land-use document), and continued support for Project Safety Net, the collaborative process to promote teen health and well-being.
Among the city's greatest accomplishments was strengthening the city's economic standing by making a series of ongoing "structural" budget cuts and labor reforms.
"In many ways, we're leaders in Northern California in trying to make structural adjustments -- not playing smoke-and-mirror budget games -- and trying to reposition the city as best as possible," Keene said.
The job isn't done, he said. Next year the budget deficit is projected at $1 million to $2 million, far smaller than in the past two years. One of challenges will be to achieve savings in compensation for public-safety workers, he said.
"We need to bring public safety into alignment with the changes we've made with SEIU and management this year, at minimum," Keene said.
The council also brainstormed other issues Palo Alto should focus on in 2011.
Councilman Larry Klein suggested that the city's goals include preserving the Caltrain service, which is now going through a budget crisis and planning massive service reductions -- echoing a "save Caltrain" summit Friday at Stanford University that he and other council members attended.
Councilman Greg Scharff encouraged his colleagues to look for energy-efficiency partnerships with Stanford, which could use the city as a testing ground for its scientific advancements.
"Having our own utility department and having Stanford out there -- there should be opportunities for Palo Alto," Scharff said.