DuPont exempt city staff salaries will see pay reduction

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DuPont Civic Center South Puget Sound News

DuPont Civic Center and City Hall

Facing a mounting budget crisis, DuPont’s Mayor Michael Grayum froze all exempt city staff salary increases effective immediately. The mayor also announced that effective July 1, 2012, all exempt staff will take a three percent reduction in pay for one year. Grayum made the announcement during the May 22 DuPont City Council meeting.

“This is not something I take lightly. This three percent reduction mirrors the State’s reduction and was a topic proposed by members of the Community Finance Committee,” said Grayum.

The pay reduction and salary freeze has no impact on the city’s union employees. Exempt staff include the positions of city administrator, finance director, police chief, fire chief, public works director, planning manager, human resources manager, city clerk, and community development director which is currently unfilled.

Mayor Grayum explained that the reductions will be effective for one year, or until a new performance management system is in place.

“I want to take this time to evaluate our current personnel policies, procedures and practices. This is not intended to discount the mechanics of the current system we have in place and the benefits that it provides to the City by encouraging longevity, consistency and stability. It is intended to build upon it and move us forward to a more progressive style of performance management,” said Grayum.

The mayor is also voluntarily taking a three percent cut from his mayoral salary. He asked council members to do the same.

“Since elected officials salaries are set by a Salary Commission, this is something that can only be done on a voluntary basis,” he said.

Freezing exempt staff salaries and implementing a three percent reduction for a year is the latest cost-saving measure the city has implemented to survive the recession and dwindling revenues. Mayor Grayum recapped earlier cost-saving measures that were implemented starting in 2007. They include eliminating or not filling four positions in 2007 and 2008.

In 2009, after two failed levy attempts, the city’s ambulance service was mothballed. Three more positions went unfilled and cost-saving measures such as reducing printed materials, and reducing janitorial services went into place. City staff began updating the city’s website instead of contracting out that service.

Grayum reported that in 2010, several positions were reclassified. Four more positions were eliminated. The Assistant Fire Chief contract was reduced to half-time. Certain staff were promoted to management positions without receiving corresponding pay increases. Union contracts were negotiated to include no cost of living adjustments for 2012, 2011 and 2012. The city newsletter was eliminated, and the city reduced landscaping costs. The city also increased utility taxes, passed an admissions tax, and increased some fees.

In 2011, the city switched to a less expensive health insurance plan and increased employee co-payments. Rental fees for parks and facilities were increased, and the Police Department took advantage of a new impounded vehicles fee that helped fund police training and replacing aging equipment.

Grayum reported that the city is no longer in a position to fund essential services, nor can it pay the debt on the Civic Center facilities.

“Not paying the debt on the civic center is not an option, and constantly borrowing from the city’s reserve funds to make the payment is not fiscally responsible,” said Grayum.

The city has a Civic Center debt payment due in June, and another due in December. At the May 1 Community Finance Committee Meeting, it was revealed the city’s 2012 shortfall on the debt payment was $770,000.  It’s $770,000 the city does not have. As much as he doesn’t like it, Grayum knows he will have to borrow from reserve funds for a second year in a row to make that debt payment.

“In the short-term, the salary freeze and three percent reduction won’t cover $770,000, but it will help reduce the amount the city has to take from reserve funds to make their 2012 debt payment,” said Grayum in a phone interview.

His announcement about pay reductions comes just a day before the Community Finance Committee is scheduled to host a Town Hall meeting to discuss potential property tax increases and other revenue options to address the city’s debt obligation on the Civic Center.

Grayum convened the Community Finance Committee in March to discuss the revenue shortfalls head-on. He describes the process as collaborative, transparent, and unprecedented.

“There are tough choices ahead that will require the determination of our lawmakers, and the understanding of our citizens as they see the choices we must make,” he said.

“We have no greater opportunity than the one before us to determine the kind of city we want: one that is leading, or one that is catching up.  I know what I want, and I suspect what you want as well,” said the mayor.

The Town Hall meeting is scheduled for Thursday, May 24 at 6:30 p.m. at The Home Course golf course Event Pavilion.

 

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6 Comments

  1. RealDuPont May 23, 2012 at 9:44 pm - 

    Sorry, but this is way too little way too late. So staff see on average 4% or more increase per year and this freeze with the 3% decrease is supposed to accomplish what exactly?

    Is this “political” math where cutting 3% plus the usual 4% yearly increase means Grayum is saving the city 7% annually? Spare us.

    Citizens of DuPont, let me explain just how impotent this gesture is on behalf of the mayor:

    The Civic Center funding plan was conceived in 2007. Now let’s assume a member of staff made $90,000 a year in 2007 and they usually get 4% a year, then what does this pay reduction mean?

    Example wage in 2008 = 90,000 x 1.04 =  $93600
    Example wage in 2009 = 93600 x 1.04  =  $97344
    Example wage in 2010 = 97344 x 1.04  =  $101238
    Example wage in 2011 = 101238 x 1.04 = $105288
    Example wage in 2012 = 105288 x 1.04 = $109499

    Now this “imaginary” person, who may have been part of the conception of the COP, will be asked to take a pay cut in 2013.

    Example wage in 2013 = 109499 x 0.97 = $106214

    My guess is that the total savings realized by the city of DuPont would be less than $30,000 this year. This, by any reasonable measure, is not good enough other than to serve as a token. I propose the salaries of Staff be cut back to the 2007 levels, the year the crisis started and was permitted to smolder until today. I would start with at least 18% and go from there.

    Also, if I were the mayor I would take these savings to start funding severance packages because as sure as the sun is going to rise in the east someone is going to be held accountable for this mess. We, as citizens, have reached our tipping point.

    Lastly, please stop saying that not making our payment for the Civic Center “isn’t an option.” It is, in fact, an option and unless our elected representatives don’t get busy with getting to the bottom of the accountability portion of this equation then the not making our Civic Center payment will become a reality.

  2. James Gordon May 24, 2012 at 3:47 pm - 

    We agree that fiscal irresponsibility on the part of city administrators is what created this problem.  So, the City of Dupont defaults on its loan…so what.  Time to face the reality and pay the piper.  The county or the state might be interested in taking over what is now known as the Dupont Civic Center, or maybe the bank can figure out what to do with it.  The only non-option I am aware of, is placing the burden on the citizens who didnt cause this problem.  By the way, where are the individuals that obtained the funding for this failed project?  They need to be held accountable.

  3. RealDuPont May 25, 2012 at 10:53 am - 

    Last night the mayor discussed with me the 3% pay cut and salary freeze for city hall exempt staff. It should be pointed out that how he arrived at this amount was neither arbitrary nor a minor feat.

    The salary reduction was conceived from both a recommendation from the Community Finance Committee and also looked to the type and magnitude of reduction some of our state employees experienced.

    While I will maintain that the 3% is still effectively a token amount the reduction itself should not be seen as a token effort. It is still more than anyone else has done in the past 5 years in the face of serious financial matters. For this the mayor should be acknowledged.

    I suppose now I can turn my gaze to our city council and ask why did they not initiate such a measure? They collectively pride themselves (and tell you at any opportunity available to them) that they are careful and considerate with your tax dollars. Too bad they do not actually have a record to back that claim up.

    The mayor has a lot of work left to do. I just wonder why nobody on council is seen helping out.

  4. MichaelDevine May 31, 2012 at 2:02 pm - 

    . My input to the Mayor is not, to raise taxes. Cut spending, cut spending. It’s quite simple. The Mayor and council are there to make hard decisions, you were not elected to show us power point’s and graphs and throw your hands up in the air, please dig in and cut spending. Middle class families in DuPont don’t have the option of raising taxes, they cut spending. I’m sure the Mayor and the Council all live within their means. It amazes me how elected officials can manage their family finances and live well, but when they transition to “City Hall” they run out of my money our money so fast it makes your head spin. Please show some Solidarity with the middle class families of Dupont, dig in and cut spending. City taxes, county taxes, state taxes, car tab fees, candy taxes, $6, $7, $8 dollar a bottle increases in liquor, add on fees for a round of golf and still “City Hall” runs out of my money, our money. Please live like the middle class families who elected you to office and cut spending. We don’t need another tax increase, we need a tough Mayor and Council who dig in and do the peoples work. Thank you for listening.

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