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[yfdgricker]

Furlough firestorm continues
By DEANNE JOHNSON in the Lisbon Morning Journal on 3/18/2010.

SALEM - Fire department overtime was only one of many issues discussed Wednesday morning when City Council's finance committee tried to wade through this year's budget.

Fire Chief Jeff Hughes told council Tuesday his department's overtime from March 3-12 included 98.5 hours directly from the layoffs. March 3 was the day three firefighters were among eight city employees laid off. Including the pension pickup for that overtime, the layoffs cost $4,133. Six of the hours was for firefighters called in so they could be laid off. The department also had another 24 hours of overtime during that period attributed to a structure fire.

At Wednesday's finance committee meeting, Hughes directly questioned the decision to continue having firefighters laid off with the large amounts of overtime it is creating.

Treasurer Robert Tullis had told council Tuesday the income tax collections as of March 16 were actually more than $750 ahead of 2009 collections of the same date. Hughes used that information in his argument.

"How do you justify the increase in overtime and keeping people laid off?" Hughes asked.

Even though Auditor James Armeni said there will not be a lot of savings the first year, he still said he believes paying the overtime costs and unemployment will be less than paying the salaries and benefit packages of the laid-off employees.

"I don't think the mayor had another way to go," Armeni said of the decision. "I just hope the mayor doesn't have to cut more. He may have to make other adjustments and it won't just affect police and fire."

Armeni said the city will pay unemployment for about a year, but Hughes disagreed stating he believes new regulations may allow laid-off employees to collect unemployment for many more months, possibly 99 months.

"I'll have to call in the auditor's office and say bring in your team, because we will run in the red," Armeni said of Hughes' prediction.

While Armeni set the overtime cost for the fire department at $120,000, Hughes predicts it will be closer to $145,000 or $150,000. He questioned how the city can justify balancing the budget with the $120,000 figured and then forcing him to come back in August to ask council for $70,000 more to cover additional overtime.

"Where's it going to come from?" Hughes asked, receiving an "I don't know" from Armeni.

Councilman David Nestic said it boils down to whether the city's departments are operating the way they should. He noted volunteers seem to work in the police department as auxiliary, but not in the fire department.

Hughes responded that he has read the transcripts from the last negotiations and part-time firefighters were discussed, but did not happen. He blamed the city, stating firefighters were willing to bring that into the discussion, but it was the city which "dropped the ball."

"I equally wasn't too impressed with what the negotiators came up with," Nestic said. However, he said he does not believe they are stuck with the contract until 2011 when it expires. "We can't automatically assume we are against each other. We're all in this together."

Hughes said he is looking at other ways to generate money, but they are not going to happen overnight. He did not give any details.

Mayor Jerry Wolford said even with the $175,000 in interest from the utilities department the city is looking at only a $200,000 carryover balance, which is about $200,000 less than where Armeni would like it to cover expenses at the beginning of the year.

"We're in a predicament time has gotten us into," Wolford said. "That's just the hard facts. There are a couple of items council can do by vote. They may not be popular. They may not be politically correct. Without a balance of both cuts and revenue, I don't see how it will work."

One of the areas Nestic said he would like to see cuts is the city's health insurance. A family plan, which Nestic said 55 out of 91 city employees are on, costs the city between $18,500 and $19,000 annually. The city spends $1.1 million on insurance annually, about one fifth of the entire city's budget. Nestic called the $19,000 plan a "Cadillac plan" compared to other local jobs in the private sector where a family plan costs $9,000 per year. He suggested a lesser plan would drop the costs and even if employees were asked to pick up a bigger percentage, the cost would be less for them.

Throughout the meeting, the committee looked at various things in the budgets of not just the fire department but also the police department, streets department, street lights and even animal control, which is in the police budget but contracted out. Anywhere the budgeted amount of money increased over the actual expenses from the year before, the finance committee members questioned the department head about why. Some budget items were cut by hundreds or even thousands of dollars. Nestic said every $20,000 cut from the budget equals 1 percent of he income tax money placed in the general fund.

While the committee noted some things are mandatory expenses or needed in case of an emergency, others were deemed more discretionary and more could be requested if it is there later.

An executive session was held at the end of Wednesday's meeting to discuss personnel issues.

djohnson@mojonews.com

[yfdgricker]

Salem fire chief on OT: ‘I don’t get it’
Finance panel reviews city budget, line by line
By LARRY SHIELDS on the Salem News Net Web Site on 3/18/2010

SALEM - Fire Chief Jeff Hughes pressed for answers to his overtime problem while Auditor Jim Armeni said he hoped "we don't have to cut more" during finance committee budget talks Wednesday morning.

The committee spent two hours reviewing and questioning line items, line by line on department budgets.

Hughes said there were figures showing his budget increased, but said, "I actually cut $120,000 and also cut training and conferences to a minimum."

Councilman Dave Nestic said, "It was obvious you made cuts."

The general fund budget, based on an estimated $3.7 million in revenues, was originally submitted with about $129,000 in red ink. A second submission on Feb. 4 had it at about $46,900 in the red and on Wednesday, with lay-offs and unemployment numbers figured in, it was about $201,806 in the black with ongoing adjustments.

Hughes pointed out that during Tuesday's council meeting Treasurer Robert A. Tullis reported income numbers even with 2009, recovering a substantial lag.

With an up-to-the minute income tax statement, Tullis said the year-to-day receipts for 2009 were $814,019 while this year stood at $814,888 as of Tuesday.

Regarding the fire department overtime, Armeni said he budgeted $120,000 for it and asked Hughes, "Do you think that'll be enough?"

Hughes responded, "No."

Hughes has repeatedly stated fire department overtime will be about $175,000 while he has been told the lay offs will save $98,000.

"How do you justify keeping people laid off?" he asked.

"Will someone give me an answer? I don't get it."

Armeni said this year "probably" won't produce a lot of savings with the four-minimum requirement.

Regarding the layoffs, which included three police officers, the police secretary, one part-time housing inspector; and two street department employees who will retire early and not be replaced, Armeni said, "I don't think the mayor had any other way to go ... "

Hughes said the four-man minimum (contracted for) was a safety issue and Armeni said the bargaining units had to agree to "substantial concessions."

"That's my view," he said, "I just hope were don't have to cut more."

Committee Chairman Bret Apple pointed out that Hughes' "high (end) overtime estimate was $150,000" and last year it was $100,000. He asked where the savings will be realized "eventually?"

Mayor Jerry Wolford said it won't show up in personnel because of unemployment payments. He expected that to drop off next year.

Armeni said unemployment would run about a year and Hughes said "they have up to 99 months they can draw" and Armeni said, "then I'm going to call in the state auditor" and tell him "we're in the red."

Armeni said he didn't know what would happen to negotiated contracts if that occurred.

Hughes asked, "How do you justify a balanced budget and then come April 2 we throw it out? In August, I'll need another $70,000."

Nestic said, "A lot of things need to be negotiated and compromised ... a lot of things, not just the four-man minimum ..." Nestic said the fire department had no volunteers "but we do in the police department. We need to look at everything."

"I understand," Hughes said, "but it won't happen overnight ... there are ways to generate revenue."

Hughes expressed dissatisfaction with the transcripts from the last contract negotiations with the fire department while noting that part-timers were pulled off the table and now they had to wait until 2011 for the contract to expire to discuss that.

Nestic agreed with his contract assessment noting he didn't think much of it, but added he didn't know that "we have to wait till 2011" with the contract, with a "pending crisis."

He said, "We're not adversarial .... and can't be confrontational ..." but the feeling he got sometimes from some of the talk he's heard that's what it was.

Wolford wanted to put it behind and explained the "predicament" the city was in was made over time.

"More cuts, I don't like that," he said, adding the cuts they made were talked about months ago and Apple noted the income tax issue for capital improvements that was defeated. He said even if it was for the general fund "the results would have been the same."

The discussion turned to health care cuts. Nestic said they were paying between $18,500 to $19,000 per family for what he called a "Cadillac" plan. Some 55 families are enrolled.

He said there are companies "around here" with good plans for $9,000 a year" and Wolford said they were talking to their carrier. Nestic said that helped but the employee share needed to be looked at to bring costs down.

"What I don't feel sometimes," Nestic said, "there is not s spirit of cooperation from the people who have to make the sacrifices. These are low-hanging fruit ..."

Wolford said the city did all it could by going to the State Employee Relation Board (SERB) regarding those issues and Apple said he didn't want to rehash them. He said it was indicated the issues were intertwined.

Armeni said, "The bottom line is we lost a lot of revenue ... revenue always dictates the services ..."

Councilman Brian Whitehill asked what percentage of the overall expenses came from employees. Armeni was unsure of the exact figure and Whitehill said spending on safety employees had a 34 percent additional charge for pension and health insurance.

He said he was trying to "get all the figures (and) hopefully we can push forward on some of these compromise issues."

The committee also spoke to Police Chief Bob Floor about his budget and with Service Safety Director Steve Andres regarding the street, electrician and Housing, Planning and Zoning budgets and the City Humane officer's budget.

Larry Shields can be reached at lshields@salemnews.net