Monday, July 18, 2011

The Cost of Great Service

Nearly every organization, particularly in government, expends the greatest percentate of annual costs on personnel.  The City of Geneva is no different.

On any given day, the City has approximately 130 full time equivalent employees on the payroll.  These folks are spread across seven bargaining units, in addition to a limited number of "non-represented" managers and part time staff.  With bargaining units come multi-year agreements, with guaranteed increases; regardless of financial performance of the organization.

If all agreements hold, the City will spend $183,000 on pay increases for 2012.  This is exclusive of the state mandated 50% hike in New York State Retirement contributions (some upwards of 14% of salaries!).   The increase in cash compensation alone equates to nearly 3% of the anticpated property tax levy.  The total cash compensation for 2012 will eclipse the total property tax levy.

Sounds bleak, right?  Well, it's certainly not something to be ecstatic about, but we're not exactly throwing our hands up, either.  Over the last several years, we have made a march toward a more lean organization.  Since 2008, no net new positions have been added to the City organization.  In fact, in that same time period, 6 positions have been cut, with four of those coming from the Management Team. 

We will continue this march toward lean in the coming budget year.  We are evaluating all retirements to ensure that the best service delivery method is chosen.  The directive to staff is that "we are loyal only to the premise of making Geneva great, not to headcounts."  If technology or strategic partnerships can deliver the same service more efficiently, then we have a responsibility to evaluate that route.

While managing employee costs isn't the only method for achieving fiscal sustainability, as our largest cost center, it certainly cannot be avoided.