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July 12, 2009 in City
Wages & means
City struggles to balance budget crunch, rising wages of public workers
Jobs with great pay and excellent benefits can be hard to come by in a recession – but not necessarily at City Hall. The city of Spokane hasn’t stopped filling openings, and those lucky enough to land jobs will get solid pay with raises on the horizon, two taxpayer-funded retirement plans and premium health insurance.
It’s a package that city officials, including the mayor and City Council members, have started to view as unsustainable.
A Spokesman-Review analysis of city pay shows that since the mid-1970s – soon after state law gave public safety unions greater power in contract negotiations – many city workers, especially police and firefighters, have made significant pay gains compared with the average worker in Spokane County.
While wage growth among Spokane County residents has increased an average of 281 percent since the mid-1970s, most firefighter and commissioned police officer salaries have jumped between 400 and 500 percent.
The growing disparity between average wages and city pay, critics say, makes it increasingly difficult to balance budgets without cutting services. Even before the economic crisis became apparent last year, city leaders forecast a deficit, in part because administrators approved a series of employee contracts with raises in salaries and benefits expected to outpace revenue growth.
“I just really struggle with how we can be giving out these kind of continual wage increases and benefit increases when the people who are out there paying for them are taking 5, 10, 15 percent pay cuts or furlough days or are losing their jobs altogether,” said Nancy McLaughlin. McLaughlin is one of two City Council members who voted in September against a three-year contract with 5 percent annual pay raises for the city’s largest union, Local 270 of the Washington State Council of County and City Employees.
The leaders of the city’s four largest unions did not return calls seeking comment last week.
A former city union president, however, said raises for police and firefighters over the past three decades represent how vastly underpaid public safety workers were until a state law went into effect that forced departments to pay salaries comparable to those in similar-size cities.
“The wages, frankly, were so low, we had guys quitting to drive milk trucks,” said Ken Strong, who led the city’s fire union for 17 years, including through the 1970s. “There didn’t seem to be any future in it.”
Police and fire wages in Spokane resemble pay in Tacoma, Vancouver, Wash., and Bellevue, Wash., according to salary data compiled by the Association of Washington Cities.
But with the troubled economy making expected shortfalls deeper, Spokane Mayor Mary Verner and the City Council are pushing unions to make concessions to cover half of the city’s forecast $7 million deficit in 2010. They also say they want changes in pay or benefits to be permanent.
The collective message from elected leaders: Make contract concessions or face layoffs.
At a council meeting earlier this year, city administrators said some union leaders have expressed willingness to give up benefits or pay, but only if all unions participate.
In an interview last month, Verner acknowledged that mistrust among the unions is one of the most significant challenges in working for concessions.
“That has been the culture of the organization for so long that I think it’s difficult for people to sing another tune at this point,” Verner said. “Even in my recent history with the city, I’ve watched the same pattern. It’s difficult for one bargaining unit to believe that the other bargaining unit is going to participate in good faith, and no one wants to go first, thinking that going first is going to disadvantage them.”
Unlike pay and benefits for police and firefighters, state law doesn’t require city officials to tie wages of other workers to salaries paid by other cities. In general, non-public-safety raises have not been as significant as those received by police and firefighters. Garbage collectors’ pay, for instance, has grown between 260 and 300 percent in the same period in which average wages within Spokane County increased by 281 percent.
More than paychecks
Salaries are only a portion of employee costs. Of the city’s more than 2,000 workers, only commissioned police officers, city prosecutors and fire battalion chiefs pay more than $15 a month to cover their personal health insurance; city workers also pay significantly less than private-sector employees to cover dependents, according to state statistics.
Most city workers have two retirement plans – both of which are partially paid for by the city. That’s on top of Social Security, to which the city contributes for most non-public safety workers.
Pensions for public safety officers are handled by the state and are supplemented by the city and workers. Other city employees pay 7.75 percent of their pay into the Spokane Employees’ Retirement System. The city matches that amount, which was increased last year to help ensure the plan’s solvency. New workers earn 2 percent of their salary as retirement pay for each year of their service, up to 70 percent.
Employees also get 457 plans: defined contribution plans that resemble 401(k)s. Starting in the late 1990s, the city began matching some of the money employees invested in the funds. Currently, the city matches up to $161 each paycheck for firefighters, 4 percent of wages for police and up to $120 a month for members of the city’s largest union.
Human Resources Director Dave Chandler said it’s relatively common for local governments in Washington to offer both kinds of retirement plans.
Spokane Valley offers its employees a match for its defined contribution plan in lieu of paying into Social Security, said Mike Jackson, deputy city manager. Spokane County, however, doesn’t offer a match for its employees in their 457 plans.
Nationwide, a Department of Labor study released earlier this year shows that only 19 percent of local government employees receive a pension and a deferred-contribution plan with a match.
Catching up
City wages for police and firefighters went through a significant transformation in the 1970s, after state rules governing union bargaining took effect. Supporters of the change argued that police and fire unions had been ignored because they are legally prohibited from striking.
The Spokane Police Guild and elected officials butted heads in 1978 after a state arbitrator forced the city to increase police wages by 13 percent. The arbitrator based the pay on Tacoma’s police salaries, though he subtracted an amount to offset Tacoma’s higher cost of living.
At a hastily called press conference in his City Hall office soon after the pay increase was announced, then-Mayor Ron Bair said the higher wages would force layoffs and asked residents to “join us in the outrage.”
In response, the guild took out ads in The Spokesman-Review and Spokane Chronicle noting that on a per-capita basis the city spent considerably less on policing than other Washington cities. It also said the pay increase would place “top patrolmen’s wages just over $5 less per hour than those of such journeyman wages paid plumbers, steamfitters, welders and sheet metal workers in Spokane in 1978.”
Strong, the former fire union president, said better wages increased competition for jobs, leading to a better pool of candidates.
“We used to have collective begging,” Strong said, noting that before state law was changed the fire union appealed to voters for pay increases through ballot initiatives. “No question about it, (collective bargaining rules) made the city sit down and negotiate with us.”
Terry Novak, who became Spokane’s city manager just before the arbitrator’s decision in 1978, said he believes bargaining law should be modified to provide more balance for local governments.
If city wages are rising faster than those of most taxpayers, there could be backlash, Novak said.
“It’s tinder waiting for the fire,” said Novak, a professor in Eastern Washington University’s public administration graduate program.
Despite what Novak sees as a disadvantage in bargaining, he said the city faces a bigger problem in balancing its budget from approved citizen initiatives over the past 15 years that have limited state and local governments’ abilities to raise taxes and fees.
Novak disagrees with union sentiment that the city was underpaying its public safety officers when he arrived. The city never had a problem attracting candidates, he said.
“I remember being shocked at the number of people who showed up when we gave the entrance exam,” Novak said. “We had several hundred people.”
Glenn Kibbey, chief examiner to Spokane’s Civil Service Commission, said the city has few problems attracting qualified candidates for most city jobs. The down economy appears to be increasing the city’s applicant pool.
Almost 600 took the civil service test earlier this year in hopes of joining the fire department. That’s up about 200 from two years ago.
Some of the 10 candidates who tested last week for Spokane’s open environmental analyst job said they were out of work.
Erika Schwender, for instance, had been laid off by a mining company. She said a job in local government appealed to her because it’s focused on public service.
“When you work in the private sector, you’re usually focused on your client or the organization you’re working for, and there’s not much public outreach,” Schwender said.
Closing the gap
Verner said she doesn’t regret signing off last year on the contract for Local 270. She noted that the union and her administration came to an agreement before stock markets crashed in the fall.
“I’m comfortable that we did the right thing under those circumstances. It’s very easy now in 2009 to say, ‘Well, in hindsight you would do something differently.’ But for all we knew we could have continued the trend that we were on, which was an excellent financial forecast.”
The administration agreed to similar compensation increases earlier this year – after the recession had taken hold – for the city’s fire battalion chiefs.
Now, however, city leaders are taking a harder line.
Chandler, the city’s human resources director, said each union has been given a target it must meet for cuts. Whatever is not met in concessions will come from layoffs, he said.
Gordon Smith, a staff representative for the Washington State Council of County and City Employees, said if employers can prove there are shortfalls and are willing to share the burden among the work force – including management – unions will consider concessions.
He noted that Coeur d’Alene’s city unions recently voted to forgo a pay increase scheduled for later this year to save jobs and city services. The union representing Spokane County building and planning workers agreed to cut hours.
“What I’m finding at least here so far is that people are understanding that we don’t want our members having to job-hunt in this economy,” said Smith, who represents Spokane County and other unions. “Unlike some of the stereotypes of unions, they’re stepping up to the plate.”
Verner said the city’s goal is to create a 2010 budget that doesn’t hurt important services.
“Our citizens are going to expect the same service regardless of what our budget is,” Verner said. “You just expect somebody to show up and pick up your garbage, you expect to call 911 and get a (response). You want your potholes fixed. You don’t care that we have to cut our budget by $7 million.”
Snow rules will be considered 
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George_Sands on July 12 at 11:17 a.m.
I wonder how employees Franklin and Webster can earn $110K w/out a college degree.
With all that money and retirement. Karl Thompson should be required to liquid all his savings and retirement prior to the public picking up the tab for his legal defense.
liarsinnews on July 12 at 2:03 p.m.
Novak, said one thing I must agree, i. e. the number of applications submitted to the city to fill its vacant/new positions (“hundreds”). Mayor Verner, continues her reckless spending habits, which proves at least to me, she lacks the leadership needed to make sound corporate decisions. The city budget shall continue to show a pool of red ink. Between Verner, and carry over bean counter that former Mayor Powers appointed, Gavin Cooley. The public does not stand a chance with these two people.
nslopeofw on July 12 at 3:24 p.m.
Reading the full story in the paper today, with the graph of how much workers are actually paid, i have a few concerns.
I find it a bit unsettling that a clerk makes as much as a garbage dude to start. ( Clerk1 $27,750, Clerk2 $30,610, and Clerk3 $ starts at $32,552, where as a Garbage collector1 starts $31,132, and level2 starts at $34,201) And, what the hell is the deal with librarians? ( $43,055 to start, and senior librarian $$45,247 to start) Goodness, they make big bucks for hanging out inside, working on computers, and saying an occasional shhhhhhhhh.
But, the big one is that fire fighters on the job for 10 years or more make more than police until they make detective. WTF?
I don’t have a problem with the people putting themselves in harms way making good money, but the insurance/retirement benefits need to be more in line with the private sector.
Per the article in today’s (sunday, July 12, 2009) Spokesman Review by Jonathan Brunt:
“Of the more than 200 city workers, only commissioned police officers, city prosecutors, and fire battalion chiefs pay more that $15 a month to cover their personal health insurance; city workers also pay significantly less that private-sector employee’s to cover dependents, according to state statistics.”
westside on July 12 at 5:16 p.m.
Face it, the fastest growing jobs are at city hall, highest pay and benefits, beats private sector hands down. Poor Spokane private wages(taxes) can’t pay the super high salaries and benefits to city employees. City unions RUN the mayor and city council…binding arbitration, city is stuck and has to pay the wages…state law! That is why these multi- million dollar bond issues come up..roads, fire equip etc…80% of all taxes collected by city goes to their employees. In the private sector this would be bankruptcy..real fast.
John_Waite on July 12 at 5:32 p.m.
Great timing on this article. I’ve been fighting this battle for years. This is the #1 problem we have faced for years in Spokane. It’s why we have poor roads, cannot maintain our infrastructure, and don’t have enough police on the streets.
So now is the time for new leadership on all levels of city government. I propose we sit all the levels of government workers from labor, unions, management, administration and taxpayers together to work on one set of numbers that labor and management acan trust. And we have to figure out what the real appropriete pay levels are for a community where the average worker makes $36,000.
Lets pay city government workers fair wages based on Spokanes economy, not those on the west side of the state.
John Waite, city council candidate
www.votejohnwaite.com
George_Sands on July 12 at 5:35 p.m.
John, so how come you came to the League of Women voters debate looking like a homeless person?
nslopeofw on July 12 at 7:37 p.m.
John Waite-
I went to your web site, and it looks liberal, yet some of your posts on here don’t look liberal. Are you a liberal? Do you believe in free social programs? Would you put free, government run social programs ahead of law enforcement, infrastructure, and roads? Do you believe ALL the people should pay for services? Do you believe those that have should pay for those who don’t have?
It looks like you have the red@zz for Palin. Do you?
Inquiring voters want to know.
John_Waite on July 12 at 10:43 p.m.
George - Do you have anything constructive to say? Or do you just badmouth everyone? That’s how dress, and I think I look fine. Why don’t you ask me some issue oriented questions?
nslopeofw - Good questions. I think it’s not realistic to call someone liberal or conservative. That’s the game the two parties want us to play. I consider myself a fiscal conservative, social progressive. I am a 16 year self employed businessman in Spokane (owning a business and some commercial property), so I believe in capitalism. But capitalism without a degree of respect for human beings is a lost cause (as seen in the recent collapse of our quasi public/private capitalism). I believe in education and social services to teach people to join the middle class. I think America, the richest country in the world, should be able to afford to have everyone (especially kids) have some form of health care. I think most government taxing and spending should be done at the city and county level, not at the state and federal level. I believe in a progressive tax structure with those making the most paying more.
I cannot figure Sarah Palin out. I think she does herself more harm than good trying to be in the media spotlight. But if she is running for prez, then I guess she has started the ball rolling.
nsopeofw, feel free to send me a note if you have other questions. I still struggle with the real solutions to our city (and countries) problems.
John Waite, city council candidate
www.votejohnwaite.com
George_Sands on July 13 at 12:00 a.m.
John, I hope you are calculating the financial equivalent of the free political advertising your getting by posting these “election” oriented postings and making the appropriate disclosure to the PDC.
As for badmouthing yourself, I would like you to remember that albeit this is a commercial blog site, that my speach is just as protected as yours is. (darn little). Wild unfounded libelous accusations do not make a good representation of yourself to the voters. Please do not emulate Joe Shogan in this behaviour, you know where that gets him. No one shows up to the council meetings anymore.
I WAS there at the League of Women Voters debate on the 8th even as there was a paltry turnout. Even some of Phyllis Lamphere’s responses were better than yours and she used the UFO parking spot outside City Hall. So if you get elected to City Council, will you wear a dingee old yellow polo shirt with catsup stains on it to council meetings as a representative of your district? I think your district voters should know what kind of candidate is going to represent them. The lawnmower man or a Statesman of credibility?
johnclarke on July 13 at 7:41 a.m.
I thought this article was about city pay ? Face it, the city is a gravy train. Please tell me where you can find benefit packages that will match in the private sector? You can’t. The problem is, no one has the guts to take on the self serving unions. I’d personally like to see an investigation of the fire budget. I see too many fire captains pulling down 6 figures, brand new firehouses everywhere, and new equipment that we probably don’t need. Why does a fire truck have to go on EMT calls? (Answer - so they put miles on the fire trucks and the public thinks they are doing something) This practice is wasteful, and not common in other cities. Why is EMT service contracted? Why do we not use more volunteer firefighters ? This practice is very successful elsewhere. How many hours a week does a fightfighter work? How many actual FIRE calls actually happen every year?
Start running the city like a business, and stop wasteful practices.
RK on July 13 at 8:08 a.m.
RE: John Waite
So since you are so outraged over city pay and benefits should your run for city council be successful will you argue to reduce the outrageous pay of our city council members. If you recall they recently voted themselves a very nice 61% pay increase for a part-time job. I don’t find myself calling Nancy or Joe if my house is on fire or somebody is breaking into my home. Why should the city council feel free to be abusing taxpayer dollars while lobbying to cut salaries of the people actually doing the work of keeping the city in one piece? Why cut salaries of those plowing our streets so the private sector can get to work, or those who pick up our garbage or keep the water running??
John_Waite on July 13 at 10:23 a.m.
RK - I agree. I took the city council to task on that vote on my friday radio show. I would love to freeze job cuts and fix wages across the board. I think you could protect whatever a “living wage base” is and cut a % above that for everyone.
Ultimately, we have to find some wage balance in Spokane based on our local econony. I’ve been at the bottom of the ladder and at the top. $40,000 in Spokane is pretty good money.
Johnclarke, you nailed all the points.
George, You can say whatever. I have a radio show, and support free speech 100%. But try to say something worthwhile. Do you have any issues that you have a beef with me? Or is it just my cloths? I don’t want to waste time on your dislike of my choice of clothing.
And all, feel free to send me an e-mail at gorbob@gmail.com if you want to continue this discussion. I don’t think I’ll be able to check this story much longer.
John Waite at www.votejohnwaite.com
johnclarke on July 13 at 10:50 a.m.
Verner said the city’s goal is to create a 2010 budget that doesn’t hurt important services.
“Our citizens are going to expect the same service regardless of what our budget is,” Verner said. “You just expect somebody to show up and pick up your garbage, you expect to call 911 and get a (response). You want your potholes fixed. You don’t care that we have to cut our budget by $7 million.”
I just can’t look away from this article. Yes, we’d love our potholes fixed Mary - when are you going to start? Our streets are like a 3rd world country.
Yes, we expect someone to pick up our garbage - because we PAY for it!! In fact, exactly how much of our garbage money (millions) is sitting in a fund? How many “rate stabilization” fees are we going to see on our sewer bills? Why do we PAY for recycling?
I expect very basic services from local gov’t, and simply put - the city is not capable of providing them.
nslopeofw on July 13 at 1:06 p.m.
Isn’t Waste management a national company? How then, are these jobs city jobs? It all goes to the refuse sites run by WM, and using WM vehicles.
I can see no reason to pay clerks at the city anymore than clerks at the bank.
I still have no problem paying cops and fire getting high wages, i just think that cops (who get shot at) should make more.
Now librarians making $40K to $65K, that is ridiculous.
jonathanb on July 13 at 3:32 p.m.
nslopeofw,
Waste Management has the contract to collect trash in Spokane Valley and outside city limits. Within the City of Spokane, garbage and recycling is collected by city employees in city-owned trucks.
nslopeofw on July 13 at 10:48 p.m.
Thanks for the clarification. The people who do my trash are great, and deserve every penny the get paid.
It kinda sux that the city clerks make roughly the same money as those people. Can you imagine the nasty stuff they must have to deal with? There is a big difference between being outside in all weather, dealing with other people’s trash and sitting in a nice climate, working on a computer. I don’t see a problem with a good wage, or decent bennies for trash folks.
But, back to the librarians, I wonder how many there are, and what could be saved by lowering their wages or outsourcing the jobs? Seems like we are always hearing about how the libraries are needing funds, yet we pay them big money, and huge bennies, for cataloging books. Is that really necessary?
lewis8457 on July 14 at 9:30 a.m.
I am still waiting for the credit from WM for the 2 weeks of trash they never picked up in December but they billed for.
The high wages our government workers make has always been an issue. How they can expect to stay liquid when the average Spokane workers make less then 25 grand while paying taxes for their city workers making twice that plus the benefits. Doesn’t take a rocket scientist to tell us sooner or later the well will run dry.
There is no reason to pay a cop in this town more the 100 grand a year. They have little to no chance of getting shot in Spokane, in fact the citizens in this town are in more danger from the police then the police are from the citizens.
It has been known for years here in Spokane if you want a steady good paying job with benefits get a city or county job.
Add to the fact we have many employees on the city and county payroll that should have been fired years ago but the unions wont allow them to be let go. So we have a bunch of inefficient workers sucking off the payroll when we could get some people in those jobs that would actually do some work to earn the pay.
The whole thing is a crime against the tax payers, but the taxpayers have no right to bring a change.