Going into next year’s budget sessions, city hall and residents
are honed in on cutting administrative costs, chiefly by
consolidating basic services into fewer departments and reducing
the number of highly paid management employees.
Going into next year’s budget sessions, city hall and residents are honed in on cutting administrative costs, chiefly by consolidating basic services into fewer departments and reducing the number of highly paid management employees.
Based on a Times analysis, since fiscal year 2007-2008, the city has collectively cut the city manager’s office, human resources, finance department, information services and council services and records management by about 7 percent.
Also since 2007-2008, city staff numbers dedicated to administration services, and the salaries and benefits for those employees, have been cut by about 18 percent, according to finance director Kevin Riper. Currently about 16 employees deliver these services.
As of this year, the city’s administration budgets account for about $2.5 million of the general fund.
And that cost is likely to drop when the city manager’s recommended budget for 2011-2012 is published in the coming days. That proposal will reflect concepts approved by the council in August 2010 to fold public works, engineering, planning and development services into one department headed by the assistant city manager – a position created in January and held by Leslie Little.
Until this year, those services were scattered among three departments – public works, business assistance and housing services, and community development. Starting July 1, those branches of city hall will likely be consolidated into two divisions under Little – engineering and utilities, and planning and economic development.
The new city hall organization chart to be presented with the budget proposal will also likely include changes made to the human resources division of the city manager’s office. In March the council approved a concept to eliminate two existing vacant positions in that division, folding them into one newly created human resources manager’s title for which the city is now recruiting. In recent years, the human resources office has shrunk from four employees, and the proposal approved in March whittles that number to two.
Tewes declined to say exactly how the new organization chart would look, and how much administrative costs will be cut as a result of the upcoming budget proposal. He said it is unlikely that those services would be much thinner than they are now. He added there won’t be much left to cut from administration after the changes in human resources and economic development services take effect.
“We will end up with a very lean administrative staff, and yet the responsibilities of city management are just as important” as they used to be, Tewes said.
Mayor Steve Tate added that “a few years ago” these services were the best place to start in making cuts, but with continuing reductions there’s not much more to reduce or consolidate. Now, more cuts in those areas might sacrifice the level of service.
“Whether or not we can get any more efficiencies, ask me after the budget” is presented, Tate said. “It is extremely lean. In city hall, not too many desks are full.”
City administrative changes are even more apparent as one looks further to the past. In 2000-2001, eight department heads reported directly to him. Now, four employees report directly to Tewes – the assistant city manager, police chief, recreation and community services director and the administrative services director.
Layoff notices presented to 14 employees this month reflect the consolidations of departments approved by the council in recent months, Tewes said.
The layoffs are at least partially dependent on the outcome of any potential negotiations with the city’s three unions. And while the council last week approved contract amendments for the city manager and city attorney, the timing of the layoff notices irks Morgan Hill resident Frank Manocchio.
“The council missed an opportunity to set the tone of the negotiations,” Manocchio said. “If you were a city employee and just saw the boss got taken care of, and now you go into (closed session negotiations), and they tell you they’re broke and you’re the one that has to make the sacrifice, that’s not good for morale.”
Tewes and city attorney Danny Wan each agreed to give up a 2-percent cost of living raise that is allowed in their contracts. This as well as amendments capping the city manager’s leave time and reducing the city’s contribution to his deferred compensation amount resulted in a reduction of about $18,000 in the city manager’s contract costs, according to city staff.
Tewes’ salary for 2011-2012 will be about $194,000, and Wan’s salary will be about $175,000 – neither figure including benefits.
Morgan Hill City Hall administration costs
Department/ 2007-2008/2009-2010/2010-2011
City manager’s office / $472,000 / $358,000/$340,500
Human Resources / $516,000 / $451,000 / $410,200
Finance / $1,070,000 / $1,080,000 / $1,076,000
Information services / $318,000 / $473,000 / $438,000
Council services and records management / $337,400 / $342,000 / $263,000
Total / $2,713,400 / $2,704,000 / $2,527,700
Overall cost reductions, 2010-2011
Department/ Since 2007-2008 / Since 2009-2010
Administration/ $186,000 (7 percent cut) / $176,000 (6.5 percent cut)
Police / $8,000 higher this year / $168,000 (1.6 percent cut)
Recreation / $403,000 (8 percent cut) / $104,000 (2 percent cut)
Public works / $1.9M (8 percent cut) / $1.4M (6 percent cut)
City attorney / $207,000 (32 percent cut) / $54,000 (11 percent cut)
Community development / $1.1M (26 percent cut)/ $591,000 (16 percent cut)
