Monday, June 16, 2008

John Musolf Discusses Oro Valley Budgeting Process

Our Oro Valley neighbor John Musolf has some major concerns about the town's budget. The following is an email from John.
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The United States, the State of Arizona, Pima County, and the Town of Oro Valley are all experiencing a recessionary economy. Every day, television and newspapers bombard us with the housing credit crunch crisis. Many people are losing their homes or cannot cope with the house payments because of interest rate increases. Additionally, energy prices for gasoline and utilities have gone out of sight. Food prices have doubled in many cases. Many families are finding it extremely difficult to survive. We hear stories of where people have to virtually give up food to have enough money to buy gas to get to their job.

People are reducing their personal budgets to the “bare bones”.

I have looked at the Town of Oro Valley Town Manager’s Recommended Budget 08-09 and believe that the Town of Oro Valley must do the same critical “belt tightening”. I have seen little no attempt by the Town Manager to try and control or reduce proposed expenditures. I recently wrote a letter to the editor of the Explorer Newspaper (June 11, 2008) concentrating just on budget personnel costs. The town manager recommends both step ($1.5 million) and merit increases ($384,000) for the town employees. This has nothing to do with cost of living increases for inflation. It is like an automatic pay grant or “entitlement” for the town employees. I don’t believe the taxpayers have had their pay increased recently in this current economic situation.

A major element missing from Oro Valley’s budgeting process is cost justification. The Oro Valley budgeting process perpetuates the status quo or increases it. It ignores economic conditions. It does not research whether things such as increased productivity have reduced the need for something like increased labor (personnel). Or whether a department can operate in a more efficient manner. The budget calls for 5-½ new positions. Has each recommended position been critically reviewed and justified? What services will suffer if these positions are not added?

Although, my letter to the editor was directed to personnel costs there are other “Red Flags” in the budget that need to be reviewed: For example, the Town Managers’s recommended budget for 2008/2009 has $50,000 allocated for a historic cultural inventory. Why is any taxpayer money being used to support this type of request in this recessionary economic time? What is the imperative (who or what will suffer) if this historic cultural inventory is not performed now? What “in-heavens-name” is a historic cultural inventory? Who on the historic preservation commission (HPC) placed this request (there is no vote recorded in the HPC minutes) with the town manager for inclusion in the 2008/2009 budget?

In my opinion, the Town Council and the taxpayers need to take a very critical look at every penny in the proposed budget.

John Musolf
Oro Valley Resident and Taxpayer

21 comments:

boobie-baby said...

Good points, John. Make the Manager defend his proposed budget without the trickery that Ms. Dankwerth used to fund an increase in job positions based on approval of the utility tax. That was a HUGE mistake--to tie the addition of personnel to a specific tax that is supposed to be temporary.

As for merit increases and cost of living increases, you want to hire and keep the best people you can find. These employees face all of the same financial problems that you touched on. If their salaries don't keep pace with inflation, it'll just cost more to replace them when they leave. Sorry, but that's a fact.


This manager is a former finance guy, and he knows every little accounting and bookkeeping trick in the world. He jumps when the Council says "jump"--so maybe the Council should tell him to jump over these expenditures this year, unless there's a timing issue (like matching grant funds) that require more immediate approval.

One of the larger issues is the cost of employee benefits--both here and at every other company in the U.S. It's a national issue that won't get solved in our little community. You want healthy employees, but you don't want to break them financially with increased co-pays, deductibles, and other tricks that insurance providers use.

Let's make sure that the backhoe operators and the park maintenance workers and the library sorters and the Coyote Run drivers are properly compensated.

Richard Furash, MBA said...

John

The Zeeman couldn't agree more. When was the last time that Oro Valley spending was scrubbed? When was the last time departments were asked to justify every single expenditure (zero based budgeting)?

Probably, never.

Add to your list, John, a pet peeve of mine which is Oro Valley's extensive use of outside consultants and legal counsel. This practice simply must stop.

So the Zeeman calls on the new council to push back on this budget, as new members promised. Beat it down until it makes good economic sense in these difficult economic times.

Boobie-Baby

I don't agree that the Town needs to retain the best people. These are public employees who should not be paid on a par with the private sector. If they're really superior, they should be in the private sector where the environment is such that success can be financially rewarded.

The life of a public sector employee is far easier and less stressful than the commercial world. They have more vacation time; less stringent timetables; and they can and do take off whenever they want. Many of them would not survive in the private sector.

So, Oro Valley needs to be sure that its pay grades are sufficient to retain good workers. My position: No increases in pay.

OV Objective Thinker said...

John....I would echo BB' comments. I don't believe this is the time to increase our staff. The one exception may be the Court position as I do not want any one to get a free ride because we cannot process the necessary court documents in a timely manner resulting in a dismissal of charges.

I would also like to see ALL Cost of Living Allowances(COLA), eliminated. That is free money that an individual does not earn. I am in favor of merit increases for any person who is objectively rated as being above average or exceeding expectations.

I won't take exception to your reference to a recession even though we are not (by definition) in a recession. I think your description fell short of stating that we are in a recession.

Fear the Turtle said...

There is no question the cost of employee benefits for the private and public sector is a major issue, however, the employer and benefits provider do not have to resort to "tricks" to contain cost or cause any undue financial harm to employees.

One would be very surprised how infrequently employers shop their benefit programs, and when they do go out for bids stack the deck in favor of the incumbent broker and provider to discourage competition.

I wonder when was the last time the TOV put their benefits program out for bids?

cyclone1 said...

Zee man -

As someone who has worked in the public sector in some capacity for 10 years, I take strong exception to your comment. The way I interpret what you are saying is that government/public agencies should be happy with the bottom of the barrel employees because they can't pay as much or shouldn't pay as much with the taxpayer's money. Money isn't always the driving factor for people in choosing a line of work. Many of the people I have had the privelege to work with do so because they like public service and feel that the best use of their talents is to serve the public good. Less pay does not equate to less stress, and I would argue that the pressure on public employees is the same, if not greater, than that of the private sector. The level of scrutiny is certainly higher. Less stringent timetables -are you kidding me??!! When you have an elected body or the public breathing down your neck you think the "timetable" is less importatnt than in the private sector? Talk to some public employees and really listen to what their careers have been like.

The Town should be trying to recruit and maintain the most qualified, most experienced employees they can - and as a resident I would think that would be in your best interests - can you not see that? Benefits such as vacation, health care, retirement are they only things that public employers have to make up for the lower rate of pay most public employees receive.

And to respond to fear the turtle, everywhere I have worked bid out their health care plans every year.

boobie-baby said...

Zee Man,
By your logic, a town or city should not hire the best candidates. We should settle for those who can't or won't make it in the private sector. It's like everything else in life--you get what you pay for.

And as for outside legal counsel, that's a virtual necessity when there are so many issues that come before the Town Attorney, sometimes placing him/her in a conflict of interest position. A few years back, the Council took the responsibility for hiring and supervising the Town Attorney away from the Town Manager and gave it to themselves. Therefore, there are times when the Town Attorney may give advice, the Council may ignore it, and we end up in some legal battle that requires outside help. Sometimes there are issues that are politically sensitive, in which case it would be preferable to have another attorney with no connection to the Town and who could not be supervised or swayed by the Town Council.

FTT--my understanding is that the benefits (health in particular) are shopped every year. Sometimes, the big companies simply don't want to bid, or their bids are ridiculously high. Call the HR Director and ask her--she'll tell you what a battle it is each year.

cyclone1 said...

And another thing - OVOT I usually agree with most of your posts, but I gotta take exception to this one. COLA is not "free" money as more often than not, some other cost to the employee goes up for the year. For example, the COLA is 1.5%, but ASRS raises their contribution percentage by 1% and heath care premium goes up 1%. So in essence, the employees take home pay actually goes down .5% from one year to the next. I am not saying it should always go up, but shouldn't it at least stay the same?

OV Objective Thinker said...

Cyclone...I'll comprimise with you. Stop the COLA and add that money to the merit potential. I simply do not want a below average employee to get more money. COLA's promote mediocraty.

Zee Man... You are way off base here. The Town must compete to hire the best. If not then much of our work must be redone. The cost of quality is includes the redo. If we do it right the first time, with quality people we save money.

Just a side bar observation....

Folks like you, Art, John, Salette and Bill are out there telling everybody that the Town is poorly run and then you have the gonads to say that the stress level is less for Town staff. Where does than meet the logic test?

OV Objective Thinker said...

Zee...Typo...That rather than than. Maybe I should have also used the word denegrate somewhere. Couldn't resist.

Cyclone....I want to give you a more direct answer. The pay should not remain the same. It should go up because the individual became more proficient at their job. As a manager, I always expected employees to perform better from one eval period to another. If they didn't then they deserve no more money. My pappy used to say that the only reason a person should get more money is if he/she did more or better work. My pappy was a smart man.

Victorian Cowgirl said...

But if you can only get a raise because you did MORE or BETTER work, how would that work out? How can you make your work better every year? There's only so much improvement you can do. How can you do more work every year without adding on more hours in which to get it done?

Raises should be given based on other things, too, like being reliable, being professional, representing your company well, etc.

Just my opinion.

Richard Furash, MBA said...

Greetings All...

In the private sector, where only the most competitive companies can survive, some level of turnover is planned and acceptable.

A company can not afford to pay the same people more money to do the same job unless that job is mission critical.

Therefore, people who want more money leave for better pay. Then, the company hires someone to replace them at a reduced salary level. This is good business. Retaining people to do the same job for more and more money is simply bad business. A company would not remain viable if it did that as its competitors would undercut them.

So, some level of turnover, especially in jobs requiring moderate skill levels, is good. It keeps a business viable.

Oro Valley has few, if any, mission critical positions. Turnover should be planned in the budgeting process. A turnover rate of 30% is quite common among well run businesses.

Should Oro Valley really pay more to the person at a work-site to direct traffic around construction? No. Its a job anyone can do and it should be paid for accordingly.

Oro Valley simply needs to apply good business practices in personnel management.

OV Objective Thinker said...

Cowgirl,

All of those things you mentioned cannot be segregated from a job. They are a part of it. You do more and better work by becoming more proficient at what you do.

ZeeMan...

Check out the following and it may change your mind about turnover.

http://www.isquare.com/turnover.cfm

I will also send it to you via e-mail.

Every job has a salary range. Admittedly when a person reaches the top of their range they may look elsewhere to see if they can do better financially. However a well run organization will move a good employee into a bigger (and better paying) job before that happens.

While turnover rates may be as high as you state, that certainly isn't the goal of management.

And...EVERY JOB SHOULD BE MISSION CRITICAL!!!

Tobin Rosen said...

Zee Man--Please reconsider your statement regarding the Town's use of outside counsel. The fact is that (except for tort defense matters that must, under the Town's contract with the Arizona Municipal Risk Retention Management Pool, be sent to whatever counsel they assign to defend the Town) I have sent nothing to outside counsel. As I told the Mayor and Council when I was hired, I intend to keep the use of outside counsel to a minimum, with the understanding that there are certain circumstances where use of outside counsel is simply unavoidable.

I must respectfully disagree with you about people who choose to work in the public sector. Having spent almost 27 years working for municipal governments, I can tell you from first hand experience that most of those who choose to work in the public sector, myself included, are certainly capable of working in the private sector. I certainly consider all of the attorneys and support staff in the Town Attorney's Office to be capable of doing so if they so desired. But I'm glad that they don't. People choose public service for a number of reasons, but financial reward is not one of them. Please don't generalize about those who do select a public service career. In many if not most cases, they do represent the best. My colleagues in the Town Attorney's Office and the people that I've seen in the rest of Town government absolutely do.

OV Objective Thinker said...

Thank you, Mr. Rosen.

It never ceases to amaze me how some of the folks associated with this blog (managers and posters) believe, with absolutely no factual foundation...or at least they don't present any, that the Town of Oro Valley employees are nothing but a bunch of incompetent people who have no dedication to making this a great place to live.

It's really sad!!

I happen to believe that 95% of the Town staff are hard working individuals who are very respectful of their responsibilities to the citizenry of Oro Valley.

Cyclone...I just noticed a major typo in one of my postings that included you with others. I changed thoughts in the middle of the stream and didn't correct myself. Deep apologies!!

artmarth said...

There are two comments that differentiate the Oro Valley Town Attorney Tobin Rosen from Don Cox.

Our good friend Dick (The Zee Man), saw fit to offer his opinion on John Musolf's analysis.

Tobin and Cox took exception to Dick's opinion.

Tobin wrote,"I must respectfully disagree with you about people who choose to work in the public sector."

Cox had this to say: "Folks like you, Art, John, Salette and Bill are out there telling everybody that the Town is poorly run and then you have the gonads to say that the stress level is less for Town staff."

It's not surprising that Cox saw fit to bring me into the equation, but why he saw fit to take a "pot shot" at Bill Garner & Salette Latas, who never commented here---especially on this subject, speaks volumes about Cox.

That's the difference between a gentleman with class (Tobin Rosen), and Don Cox, who continuously exhibits no class whatsoever.

boobie-baby said...

You're correct, Art, that there's nowhere in this thread that the new Council people have expressed their opinion of the staff or the budget. So, on that count, you are right to challenge OV OT.

However, the election of the newcomers was based on a perceived need to change direction at the policy level at Town Hall. So, one could stretch that to infer that they felt compelled to seek office because the town is "poorly run." I wouldn't use those words, and I think that OV OT probably regrets that he used them, too, at least in this context.

Whatever Tobin wrote about the Town Attorney's office applies equally to other departments. Since every budget only has two elements--people and things--all that a Council can do is to decide what people to hire, what to pay them, and what things to buy at what cost.

OV Objective Thinker said...

Art...As usual you do not disappoint. It is your interpretation that if I disagree it indicates that I "exhibit(s) no class". I guess that falls into your community service category.

I made the statement because it is accurate. If you can find anywhere where I limited the criticism you, Dick and Jonh, Salette and Bill have leveled at the Town staff to this blog please point it out so we can all see it. Bill and Salette made reference to the effeciency of Town staff in most all of their public forum presentations. John has been critical of Town staff repeatedly in his letters to the editor. You and Dick have been very critical of Town staff frequently on this blog.

When you repeat something that has been presented in the public forum by an individual I do not believe that it can be considered a "pot shot".

Once again we have a case where you don't offer any opinion on the topic at hand. You only wish to deal with the personalities involved and how they express their opinion.

OV Objective Thinker said...

BB....I need to point out that I did not say the Town was poorly run. Nor did I say that the reason Bill and Salette ran was because the Town was poorly run.

What I did say is that those I mentioned have made public statements (in letters published in the Explorer, this blog, on their campaign web site and in the public candidate forums) that were very critical about Town staff. And when a candidate states that the Town needs to go in a different direction, I believe that is a direct reflection of the management of the Town.

artmarth said...

Cox--- Do you really believe if you keep printing lies about me (and others) often enough, our readers will believe you?
I don't think so.

Your latest accusation---
"You and Dick have been very critical of Town staff frequently on this blog."

Other than me constantly finding fault with our now departed Economic Developer Administrator, Jeff Weir, who did nothing but push for those millions of dollars in giveaways to the retail developers, and his replacement, David Welsh, who quit his job and went to TREO, and then keeps telling us how we should spend our funds---- tell me, not frequently, as you write, but ONE time that I "have been very critical of Town staff."

One last point you don't seem to understand----I control this blog, and if you think you can always get the last word, think again.

Your opinion is welcome; your lies are not. I really hope you can understand that.

OV Objective Thinker said...

Art....I am always happy to respond to your wish.

You seem to forget the incident when the Town suggested the you register as a political committee. There were several unkind comments made by you about Town staff and their handling of the issue. Here is just one that I went back and cut from YOUR post:

"But no---that's not how Oro Valley acts. Their approach is do the wrong thing, and worry about it later!"

artmarth said...

Cox---- Is that all you could up with to justify your lie?

You really ought to be ashamed of yourself.