Tough Times Ahead For Elk Grove –Time For the City Council To Act Is Now

At Wednesday night’s marathon city council meeting, Elk Grove city manager Laura Gill reported on plans to layoff four city employees and ...

At Wednesday night’s marathon city council meeting, Elk Grove city manager Laura Gill reported on plans to layoff four city employees and provided a glimpse into the city's financial future.

As Gill’s presentation progressed, she said something that most people with even a casual knowledge of the city knew: tough times are ahead for Elk Grove.

With falling property values and a thrift conscience populace, revenue from both property and sales taxes are falling and Gill said things may not turn around until 2012. In the mean time, what is the city going to do?

Coincidentally, this weekend saw the launch of the “Think Shop Live Elk Grove” promotion. Sponsored by the city, the chamber of commerce and private business, the promotion seeks to have Elk Grove residents spend their money in town and thereby generate additional sales tax revenues for the city.

Though well intended, it is unlikely this program will generate the type of sales taxes increase needed to keep things above water. The best this promotion can do is help local businesses stay open which makes the promotion worthy.

There is little the city can effectively do to reverse the slide in tax revenues unless they can magically reverse the housing slump, ease the credit crunch, reverse falling employment and goose up consumer spending.

About the only thing the city can do is cut cost. Wednesday night saw the first step toward that with the layoffs.

There are a couple of things the city council ought to consider immediately. First, cut salaries of the highest paid exempt personnel by a minimum of 5 percent.

Included would be positions such as the city manager, assistant city manager, police chief and similar positions. This will sent a clear signal not only to taxpayer, but to non-exempt employees that the city is serious about addressing the financial shortfalls.

It is hard to ask lower paid employees to sacrifice when the leaders are spared. More importantly, it would be outrageous to ask Elk Grove citizens, many of who are laid-off or are living in the fear of layoff to accept a cut in service while our highest paid employees, many of who are making six-digit incomes are left unscathed.

Second, take a close look at labor costs for the planning department. On at least two occasions this year city planning commission meetings have been canceled because there were no planning items to be heard. Intuitively it would seem with fewer projects in the pipeline there is less need in this department.

These are just a couple ways the city can move to cut cost and not severely affect vital city services. We expect to hear more at the next council meeting.

We agree with Gill that times are going to be tough and the city needs to move immediately and forcefully to address this problem before it's to late.

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Anonymous said...

I very much agree with your suggestion to cut salaries and/or benefits of higher paid city employees. Many of EG's executive employees are highly compensated in comparison to peers in other cities or CA state workers. I've long advocated across-the-board cuts to city employees' salaries and benefits before cutting positions or laying off personnel; however, I like your suggestion much better: Start salary/benefit reductions at the highest pay levels, such as within the city manager's office. Then as required, progressively move to reductions for employees who have economically-driven reduced workloads, and finally to lower echelon employees as required. Top it off by a continual search for savings in our Police Department, which absorbs over half our budget.

There’s usually more than one way to achieve cost savings, and there are likely alternatives to layoffs that remain either unexplored or unmentioned by Ms. Gill. Unfortunately, she ostensibly has absolute authority in hiring and firing people. The words that give her such power should be amended, and city council should have the last word on EG’s budget and personnel. Unfortunately, our Mayor, Pat Hume, and Vice Mayor, Sophia Scherman, seem content to treat everything coming from Ms. Gill as unmitigated fact and appear unmotivated to direct Gill to explore and present alternative solutions to layoffs.

As I've pointed out to Mr. Hume, economics is not an exact science. Ms. Gill's Wednesday night cuts were based on a "potential" budget shortfall of $105,000 predicted as of March 31, as she said twice in her point paper to council. In other words, the shortfall was not a certainty. This important point was unfortunately ignored by the Mayor, who called the cuts “a done deal” in opening statements. Additionally, though mention was made of the savings these employee cuts would bring to the forthcoming FY10 and FY11 budgets, this was not the agenda item. The main item of interest should have been the $36,000 that was to be saved in this year's budget by cutting these employees, a ridiculously small amount in an overall $51,505,000 EOY expenditure figure.

It's time EG citizens demanded better accounting, more disclosure and more explanation from our city manager's office, plus more equitable apportionment of “hard times” adjustments as we roll into FY2010.

I urge everyone to attend the city council meeting of May 27, where Ms Gill will address budgets for FYs 2010 and 2011.

Best regards

Bob Felts

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