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Faced with recruitment challenges and lingering vacancies in key City Hall positions, Palo Alto is preparing to approve salary increases for more than 200 city employees, including most senior managers, next week.
The City Council is set to sign off on Monday a new agreement with the city’s “management and professional” group, which includes department heads, supervisors and senior managers. Of the city’s seven labor groups, it is the only one that is not a union. Historically, its salary and benefit adjustments have typically mirrored those that the City Council had approved for its largest labor organization, the Service Employees International Union, Local 521.
The group includes about 223 positions, ranging from department heads such as the planning director, the utilities director, the police chief and the fire chief to highly specialized positions in Public Works and Utilities departments, including supervisor of the water quality control operations and solid waste manager. Currently, 36 positions in this group are vacant, according to a report from the Human Resources Department.
The new contract, which runs from January 2023 to June 2025, includes three significant changes. First of all, it would approve a pair of 4% increases to all base salaries, the first of which would kick in on July 1, 2023, and the second on July 1, 2024.
Second, it would give each employee a bonus of $100 per month in “flexible compensation,” money that they can choose to apply to either their health benefits or their base salary. The policy, according to the city, “provides flexibility for employees to choose how best to apply this compensation.” Under the proposed deal, all employees in the management group would start receiving the initial $100 monthly payment in January 2023. They would then get an additional $100 flexible compensation payment in January 2024.
Finally, the new contract aims to bring all positions in the management group to market level. The city had conducted a market survey to see how total compensation for employees compares to those in other jurisdictions and had identified numerous positions in which Palo Alto employees had lower salaries (the most extreme example was the “project manager” position, which was 12% below market, according to the analysis). The new contract would bring these positions, which include (among others) deputy city attorney, supervising librarian, and directors of the Public Works, Administrative Services and Community Service departments, to market level in January 2023, according to staff.
The city expects the adjustments in the new contract to cost about $8.6 million over the plan’s two-and-a-half year term. Of this amount, $5.4 million would come from the general fund, which supports most city services aside from utilities.
The topic of staffing shortages has been a persistent theme over the past year and has often emerged as a key barrier in council plans to boost public safety, introduce transportation initiatives and make upgrades to the city’s electric grid. In presenting the proposed compensation adjustments, Human Resources staff pointed to Palo Alto’s “consistent difficulties in recruiting and retaining personnel in key areas of service.”
“The great resignation (among other impacts) brought these difficulties to a wider array of City departments and services,” the report states.
As of last month, the city had 154 vacant positions out of 1,025 full-time authorized positions, accord to staff. The vacancy rate of 15% is a 10-year high, the report states.
Even despite implementation of expedited hiring practices, the vacancy levels have not started to decline. Earlier this year, as the council was approving its budget, it received a report on vacancies that showed 140 open positions, which included 47 in the Utilities Department (including linespersons, electricians, engineers and supervisors) and 36 in Public Works (including tree trimmers and water quality control plant operators).
Some departments have since made strides to fill the positions. City Manager Ed Shikada recently filled three “assistant to the city manager” positions (which are not to be confused with the more senior “assistant city manager” position) and Police Chief Andrew Binder touted in a recent community update the department’s recent success in recruiting new officers, including three veteran officers from other departments, eight new officers who are now in police academies, one who just graduated from a police academy and three others who have completed the department’s field training program.
“While more work remains to be done, we are moving in the right direction,” Binder wrote in the update.
The proposed agreement with the managers-and-professionals group also serves as an important precedent during a period where management is negotiating on new contracts with all of the city’s labor groups. All union contracts are set to expire in the current fiscal year, which ends on June 30, 2023.
The council has been discussing the topic of labor negotiations behind closed doors several times over the past month. Before the council’s Dec. 5 closed session, numerous employees from the SEIU group talked about lingering staffing shortages and asked the council to accept the latest offer from the union.
“Currently, we’re having a very difficult time attracting and retaining employees,” said David Sigua, library associate. “And for this great city to continue to flourish, we need to offer competitive compensation, cost of living adjustments that keep up with rising costs and continued coverage of our health care so that we’re comparable to other cities in our area.”
Chris Brickner, a substation electrician in the Utilities Department, said the city has 66 utility electrician positions, of which 23 are vacant. Of the positions that are filled, six are occupied by apprentices and trainees who require extra attention from the department’s more senior employees.
“What I’ve seen over the last few years is our organization bleeding out,” Brickner told the council. “We need to find a way to stop the bleeding immediately before we have very little to no employees to provide the services we need for our utility.”
What’s very surprising to me is that a city of 66,000 people has over 200 “senior managers!” This implies that there are more than 200 first level managers and many more individual contributors.
That seems like a pretty huge bureaucracy for a city of this size.
With all the raises and senior management slots, have the fixed power outage reporting, the absurdly erroneous surveys that let them claim we want to waste $144,000,000 on a fiber network the city survey WOULDN’T LET us say we don’t want, restoring the staff for the police blotter, restoring library hours, fixing the sensors for traffic lights that never change even after a year of complaints, fixed the solar permitting process yet? (I have friends waiting more than year!), fixed the Planning Dept’s permitting process (I have a friend waiting a year), realized that the JMZ is a lower priority than a reliable electrical grid, realized that bollards everywhere don’t calm traffic; they just make drivers crazier leading to more rear-end collisions…..
SO Thrilled the City Manager gets to expand HIS huge staff…
Palo Alto city finances have been unsustainable for 25 years, with ever-increasing unfunded liabilities since the early days of manager Frank Benest, and we continue to march toward insolvency..
1000 employees in a city of 70,000 is not justifiable, and is way out of line with other cities in Northern California. Now we read that some study conducted by people hired by the city employees found that the 200 non-union senior staff of manager Shikada are being underpaid by 12% compared to other cities, so they’re getting an immediate 12% raise. I suspect if these new salaries were divulged, there would be a huge outcry, especially when people realize that any employee who has worked for 30 years will get 81% of their final salary, plus free medical for their family, for life. For someone retiring after 30 years at age 55, they are in effect being paid double that salary, the second half being paid after retirement by people who did not benefit in any way from whatever that person did during their employment. To allow this to continue is gross irresponsibility on the part of Shikada and the City Council that approves these payments and liabilities.
We should see the “Great Resignation” as an opportunity, not a problem. The city does not need 1000 employees. It does need a city manager who knows how to make effective use of the workers, to address critical issues like public safety and timely response by planning and building departments.
Every other Friday off along with a new floating holiday?? baked in raies regardless of economic conditions or performance and medical benefits the private sector could only dream of and the same excuse “compared to other cities” the question should be do the city employees deserve a raise? I guess with a $40 million dollar surplus anything goes and the sham continues.
These are good times to be an upper-level City of Palo Alto administrator. They are well taken care of and have lifetime employment.
The PACC will find ways to tap into that $40M slush fund. The question is, will it benefit PA residents?
@Barron Parker Too, all PA City employee records can be found at https // transparentcalifornia.com /salaries/2021/palo-alto/ https://transparentcalifornia.com/salaries/2021/palo-alto/
Here’s some of the highlights you can see, $3 million in salary and benefits for the top six earners of 2021:
Edward Shikada City Manager
Palo Alto, 2021 $573,307.57
Molly Stump City Attorney
$487,795.83
Geoffrey Blackshire Fire Chief
$474,506.66
Mark Vonappen Fire Captain Emt
Palo Alto, 2021 $469,332.51
Dean Batchelor Director Utilities
Palo Alto, 2021 $457,631.76
Zachary Perron Police Captain-Adv
Palo Alto, 2021 $444,547.20
As for “the great resignation” .. I think it’s a bunch of horse crap. People resigned to do what –play videogames in their mommy’s basement? I really wonder if the COVID deaths are properly being accounted for. People don’t just resign. Where are they getting food, and clothes, and shelter? Are we to presume that the PA people who quit are now among the homeless? Because unless you have money or a fat pension, you can’t just quit your job and eat bon bons all day.
Here’s another way of looking at it:
Summary for Palo Alt 2021
Total population 68,624
Total number of city employees 1,187
Total number of full-time,year-round city employees 898
Median pay for full-time,year-round city employees $123,910
Median pay and benefits forfull-time, year-round city employees $191,499
Total city employee compensation $191,169,059
Total city employee compensationcost per resident $2,785
Median earnings for full-time,year-round private workers $180,685
You can also search by job description or department.
Thanks for those. The numbers are absurd and obscene in view of how they “manage” to enroch themselves and their consultant buddies while failing to provide effective supervision of their staff.
Still waiting to see the phrase “cost-effective” appear in any of their mission statements re the services they’re supposed tp be providing to us. Aren’t you glad you enshrined the $20,000,0000 annual “cost overcharhrges” plus the $14,400,000 utility user tax.
Where, might we asks, been the City Council in supervising this or do they just keep advocating spending $144,000,000 pn a fiber network the can’t manage and plans to outsource anyway??
> Total population 68,624
Total number of city employees 1,187
^ This comes to approximately 1 Palo Alto municipal employee per 57 Palo Alto residents. Providing there is prompt attention paid to incoming resident concerns and complaints, this seems like a reasonable ratio.
> Total city employee compensation cost per resident $2,785
^ Couldn’t it also be said that this per resident expenditure is kind of like an insurance policy that covers our potential police/fire/paramedic coverage and other municipal services like public works and city maintenance?
> Median pay for full-time,year-round city employees $123,910
> Median pay and benefits for full-time, year-round city employees $191,499
^ Is this not the cost of doing business and to ensure that quality city employees are not lured away by the larger salaries that high-tech companies in Silicon Valley generally pay?
As far as the higher upper management salaries are concerned, the same rationale can be applied.
As in professional sports, the city manager/attorney/police and fire chiefs are highly-trained specialists and they are paid accordingly to prevent them from becoming free agents and taking their valued skills to another municipality.
Inflation is another factor that impacts municipal salary growth and the responsibility for keeping it in check rests with the Biden administration and our federal economic agencies.
This is a clear statement of values and priorities:
“City Manager Ed Shikada recently hired three assistant city managers . . .”
When I see statewide stats on Assistant City Managers, the one that stands out most is:
Ruth Shikada Temporary Employee Santa Clara, 2021 $517,668.71
Ruth Shikada Assistant City Manager Santa Clara, 2020 $502,597.00
Ruth Mizobe Shikada Assistant City Manager Santa Clara, 2019 $485,190.83
Ruth M. Shikada Assistant City Manager Santa Clara, 2018 $455,588.19
Ruth M Shikada Assistant City Manager Santa Clara, 2017 $342,955.00
Ruth M. Shikada Economic Development Officer/Assistant City Manager Santa Clara, 2016 $296,631.83
Ruth M. Shikada Economic Development Officer/Assistant City Manager Santa Clara, 2015 $281,947.00
Ruth M Shikada ECON DEVEL OFFI/ASST CITY MGR Santa Clara, 2014 $269,879.80
Ruth M Shikada ECONOMIC DEVELOPMENT OFFICER Santa Clara, 2013 $213,925.02
Ruth Shikada ASSET DEVELOPMENT MANAGER Santa Clara County, 2011 $168,468.86
RUTH M SHIKADA ECONOMIC DEVELOPMENT OFFICER Santa Clara, 2012 $144,412.61
Ruth Shikada ASSET DEVELOPMENT MANAGER Santa Clara County, 2012 $53,422.88
I sure would like to be a County “temp” worker, pulling in half a million a year. Did Ed mention who he was hiring? Are we keeping it all in the family?
Also, statewide there are over 10,000 City Managers and Assistant City Managers. Ed Shikada is 31st on the list, and on the first of 204 pages. Even Beverly Hills’ CM makes less money. Who are we trying to emulate in the recruitment department, when we are among the top tier of City payroll?
I predict this topic is going to float to the bottom of the tank faster than the story showcasing the local angle to the guy who ripped people off selling monopoly money.
Thanks, Annette and MyFeelz.
Did I miss the coronation of our new royalty or that PA finally decided to allow marijuana dispensaries to our fair city — a reference to “WHAT were they smoking?”
I want ever city “leader” who did nothing to rein in these absurd salaries ABD the growth of the City Manager’s court to stand up a AGAIN explain why the city keeps pleading poverty and why more taxes are so desperately needed to keep giving out vultures raises?
Remember that Shikada has long been among the state’s top 4 most highly paid city officials AND that he’s goingf to collect at least 3 pensions based on his high salaries.
Maybe some church group can run them and our out-of-touch city council a benefit. Maybe a nice bake sale because I don’t see how they can survive on those salaries.
@Online Name, after refining the list and culling out all of the deputies and assistant managers, Ed Shikada is 6th — SIXTH HIGHEST — City Manager in the entire state.
A little background as to how he got here, “How The City Manager Office Broke Down” reveals his cutthroat tactics after being told Shikada was going to be let go. Before it was announced, he fired his Deputy City Manager, without benefit of informing the Mayor or City Council he was doing it. Just the beginning of a shakeup, where most of the victims have never regained their footing. Except Ed. Now he’s hiring more assistant managers, who should be on notice they are completely disposable to him with or without Mayoral or Council approval. Link below to the article.
https://www.sanjoseinside.com/news/investigative-reports/dysfunction-at-sj-city-hall-behind-the-city-manager-firings/
44 years ago a shakeup occurred at a different California city, where the mayor and a city council person were targeted over a political disagreement in City Hall. We should not allow back door meetings where someone’s fate is decided without full disclosure to the people who are paying them — US, the TAXPAYERS. Nothing good comes of closed door sessions.
Yes, the growth of the City Manager’s court is worthy of comment, especially since last year the other paper put the cost of his office communications staff at $3,000,000. Thank heavens for his UpLift newsletter and its weekly recipe.
Speaking of closed door sessions, let’s not forget how Liz Kniss rushed through Shikada’s hiring, insisting he be the ONLY candidate interviewed, the importance of and giving him his huge comp package IMMEDIATELY lest he go elsewhere.
One of my favorite provisions in his comp package was that he be granted ab extra year’s salary, benefits and pension vesting if he were to be fired for cause or forced to resign — what a great way to motivate an employee to perforn optimally.
As always, we owe the former mayor so much her so much for her contributions — which keep manifesting themselves after all these years in terms of her great judgment in the people she’s backed.–
@Online Name, all valid points. Usually with a new governmental administration, all of the heads change, so the new leadership can get the support team they need. But in PA, that support is built in, with a good old boys’ network that is carved in stone. PA is in a rut. Needs a clean slate. But it can’t be done because of that network.
“But in PA, that support is built in, with a good old boys’ network that is carved in stone. PA is in a rut. Needs a clean slate. But it can’t be done because of that network.”
Don’t forget their gravy train of consultants. It’s not as if our managers actually do much work themselves or file lawsuits for OUR benefit rather than spending OUR money to appeal paying what they’ve long owed us for the utility settlement.
They even outsourced that appeal to a distant law firm so they wouldn’t have to bother responding to PA residents inquiring about the settlement process. SO WHERE IS IT ALREADY? Is PA paying us interest? It would sure help deal with their LATEST rate hikes!
I guess doing one’s job is only for the little folks who have to pay their own mortgages and rent and parking and car maintenance and health insurance …
Where’s the oversight???
@Online Name, there will never be an honest oversight committee that can separate the symbiotic twins named Palo Alto & Stanford. Without the other, each of them will wither. I know people in town who won’t even make anonymous comments here about such subjects, because their lives and livelihood would be imperiled by making public criticism about their employers. All they have to do is look at the history of this online publication and the hundreds of comments that used to accompany almost any article. People were engaged and maybe thought their opinion actually mattered. So much of what happens in this city (especially on the west side) is shrouded in secrecy even if a Grand Jury is convened to investigate any subject, the City’s answer to them is “Eff Off”. So … if you want oversight, that will NEVER be a priority in PA. They only tolerate us, the little people, for our contributions to their coffers.
@MyFeelz, alas you’re probably right. It’s a rigged game as I discovered when I tried to object to one round if utility rate hike as per the city’s email only to find the process absolutely byzantine. While that was bad, what was worse was learning that the city would only reconsider the rate hikes IF it got 11,000 votes against the rate hikes.
ELEVEN THOUSAND in a city of 24,000 CPAU utility accounts???
I suggest that an effort be started to either annex palo Alto to Mountain View or to consolidate Mountain View and Palo Alto.
MINIMUM SIGNATURE REQUIREMENTS FOR A SUFFICIENT PETITION
Pursuant to Government Code 956705, petition signatures must be secured within 6 months of
the date on which the first signature was affixed. Petitions must be submitted to LAFCO
within 60 days after the last signature is affixed. Petitions must meet the following applicable minimum signature requirements:
Annexation to a City (Government Code §56767)
Signatures by (a) not less than 5% of the number of registered voters residing within the territory proposed to be annexed OR ( b) not less than 5% of the number of owners of land within the territory proposed to be annexed who also own 5% of the assessed value of land within the territory.
Consolidation of Cities (Government Code § 56766)
Signatures by not less than 5% of the registered voters of each affected city.
https://santaclaralafco.org/sites/default/files/LAFCO_Reorganization_Petition_Form-3.pdf
******
Just starting the process might get the PACC’s attention and as the petition gets close to the required minimum signatures there will be a lot of desperate moves.
@MyFeelz,
“there will never be an honest oversight committee that can separate the symbiotic twins named Palo Alto & Stanford. Without the other, each of them will wither. I know people in town who won’t even make anonymous comments here about such subjects, because their lives and livelihood would be imperiled by making public criticism about their employers.”
Things can wither badly when it’s not fat times, worse without honest oversight.
Hopefully a journalist will do a deep dive on the City’s recruiting, hiring, and compensation practices. We’ve been told for years that we need to pay high salaries to be competitive. So how can we now be up to 12% off? And is that off the 75th percentile, or the median, or what? And how is it that despite continuing recruiting challenges, the City Manager manages to augment his department with three new assistant city managers? His salary suggests that he is a top-tier city manager. Palo Alto isn’t all that big a city. If our city manager is so good that it makes sense for his salary to be what it is (well more than the Governor’s) why does this city need several assistant city managers who are, presumably, also highly compensated? I think the tail is again wagging the dog. If CC approves these increases, they erode their own credibility.
It’s becoming clear why the business consortium was prepared to challenge a relevant-to-impact business tax. PA has a credibility issue and a transparency issue. Example: the CAFR (consolidate annual financial report) that disclosed a significant surplus, was released after the election rather than before. This reminded me of the sequencing of CC agenda items in February 2021. The week after putting funding for the Public Safety building on the agenda (and securing approval for it), Shikada and Nose opened the 2021-2022 budget process with a report that was less than rosy. Doesn’t it make more sense to discuss the financial picture before committing to a multi-million dollar capital project? Obviously, that was then. But financial decisions, such as this compensation vote, are a constant and I think it important that the City’s practice should be to base those decisions on accurate information that is disclosed enough in advance for meaningful CC and public review.
@Online Name, PA is a city that tries to get their citizens to “vote” with a $50 advance payment for something that doesn’t exist. Who says you can’t buy votes?
And it’s ridiculous to force half of utility payors to vote about a misstated and misunderstood hike to get it downvoted. But then … we can’t get our voting system corrected because the Grand Jury got run out on a rail. So there’s that.
Let’s look at some numbers:
Summary for West Hollywood 2021
City Manager Total Earnings and Benefits: $709,720.44
Total population 35,678
Total number of city employees 278
Total number of full-time, year-round city employees 215
Median pay for full-time, year-round city employees $128,302
Median pay and benefits for full-time, year-round city employees $182,513
Total city employee compensation $41,473,337
Total city employee compensationcost per resident $1,162
Median earnings for full-time,year-round private workers $81,282
Summary for Palo Alto 2021
City Manager Total Earnings and Benefits: $573,307.57
Total population 68,624
Total number of city employees 1,187
Total number of full-time,
year-round city employees 898
Median pay for full-time,
year-round city employees $123,910
Median pay and benefits for
full-time, year-round city employees $191,499
Total city employee compensation $191,169,059
Total city employee compensation
cost per resident $2,785
Median earnings for full-time,
year-round private workers $180,685
I welcome anyone who can unravel this ball of yarn, Annette. I’m not a mathemetician but I can smell rotting cheese.
@resident … any oversight would be impossible to press around here without losing a lot. That’s why nobody does it.
@Peter Carpenter, that is a great idea except that Stanford literally put Palo Alto on the map when it established the University here. Stanford will never relinquish its stranglehold on the city and the people “running” it. PA City Hall only exists to ghostwrite whatever message Stanford wants to put out.
We had an election for a business tax; the city council is suppose to “spend the tax proceeds on train crossing and rail safety, affordable housing and unhoused services, and public safety services.”
Instead, the money is being used to give pay raises to managers.
According to the above list, we’ve got at least 6 “managers” making more than the President of the Unites States whose salary is a mere $400,000.
Wondering when the coronation is.
Maybe the City Manager’s Uplift newsletter can tell us along with giving us weekly recipes and medication tips. Ah, priorities.