“If everyone is moving forward together, then success takes care of itself”
#4 Cost Savings Opportunity - City Staffing
Background: While staffing is largely within the purview of the City Manager, he/she is constrained by decisions Council makes related to the addition of FTEs, salaries, etc. Take into account some of the following premises and considerations in answering a series of questions about City Staffing that follow.
In many cases, hiring more qualified people, or more FTEs in certain roles, can add directly to the revenue stream, e.g. code enforcement, procurement and grant writing personnel.
In other cases, hiring people who may be viewed as “overqualified” for the specific position may pay other dividends. If truly talented, they can absorb work requiring a higher level of competence in addition to handling routine tasks that are also needed, and these individuals often identify cost savings opportunities thus partially “paying” for themselves.
This could appear to residents as title inflation and overcompensation, and residents also cite pension obligations as a concern even though new employees that are not currently part of PEPRA (i.e. new hires from the private sector) are not adding significant pension debt.
Another consideration is that over the past 10 years there has been unusually significant turnover among City employees (not a good thing) coupled with hiring challenges resulting from a currently robust job market and the view that longer commutes makes PVE a less desirable work location.
One solution that has been offered is to outsource many of the City’s operations (thus alleviating management headaches), especially those that can be done remotely, such as accounting, payroll, IT, procurement, etc.
Question: What is your view of:
a) a hiring policy for the City?
b) the latitude Council should accord the City Manager in running his/her organization?
c) how to ensure the City’s ability to attract talented personnel who will be committed, long term to their employment with PVE?
d) how the City Council, without intruding on the City Manager’s prerogative, can foster a spirit of teamwork and positive morale?
e) outsourcing certain City support functions?
Responses:
Michael Kemps
“MICHAEL KEMPS (incumbent)
”Attracting and retaining talented and committed personnel is challenging for our city. PVE is constrained by its geographic location, competitive salaries when comparing nearby agencies, legal limitations associated with a municipality providing services utilizing direct employees versus contractors, and a limited budget. A reasonable balance includes maintaining, supporting, and investing in internal staff, while contracting for specialized services. Recent turnover has damaged institutional knowledge. Focus on perceived title inflation and span of control has caused further cultural degradation and staffing losses. While open positions have reduced short-term costs and long-term pension exposure, this situation has been costly in other ways. Maintaining and communicating documentation and processes, while investing in culture and employee retention are increasingly critical.
A City Manager needs sufficient budget and latitude to execute. The Council can foster a spirit of teamwork and positive morale by ensuring communication is constructive, positive, fair, and supportive.
Outsourcing certain functions makes sense. IT, parklands maintenance, and capital projects are presently outsourced. One-time investments in projects (i.e. accounting system change) and associated project management should be contracted. Payroll services are contracted to ADP; payroll inputs mandated by union-negotiated MOUs are managed by staff.
Retaining employees is in the interest of residents who seek consistency of services and people. Contracting is an effective way to receive specialized services that are one-time or require specific knowledge. A blended balance, combined with effective contract and personnel management achieves a mix of cost and long-term liability controls while retaining people and knowledge we all rely on.””
Victoria Lozzi
“VICTORIA LOZZI (incumbent)
”One of the biggest challenges during my first term was with staff turnover at all levels, especially in the City Manager position. It is critical that we have an experienced City Manager who can develop a team of professionals to conduct the City’s business. I served on the search committee, resulting in the recruitment of our current City Manager who has the skills to build and develop our staff and create a positive working environment and culture that will result in excellent customer service for our residents. We need to be a good, fair employer that can develop and retain talented professionals who can build their career here.
The City Manager needs to design an organizational structure that he believes will work for the City, consult with and receive buy-in from the City Council, and then the City Council needs to let him manage that organization. The City Council fosters a positive culture by letting the City Manager do the job he was hired to do and by treating all employees as professionals.
For a city the size of PVE, there needs to be a balance of in-house and outsourced functions, and we need to determine which model produces the best level of service. Even with outsourced functions, there needs to be staff to manage the contractors. We need to do a better job managing the contractors we have and ensuring a high level of service to residents for dollars spent, then we can determine what works best for PVE.””
David McGowan
“DAVID MCGOWAN (incumbent)
”The city has been operating under a stringent budget and in a pandemic environment that has been difficult and restrictive on staff. The city is back to a more normal set of working conditions and has recently hired an experienced, energetic, and team-oriented City Manager. We need to allow him full authority to operate city activities within city council determined limits. Our City Manager has been empowered to create a team of cohesive team players that subscribe to a culture of “doing the best for the community”
I recognize the desires of city staff and constraints our community presents such as commuting time, ability to work remotely, hours worked per day, challenges presented by residents, compensation, etc. We need to create an environment that is healthy and vibrant to attract and retain the city staff skills we desperately need. The City Council can foster this environment, but it ultimately needs our entire community to be behind it!
Outsourcing can be effective but needs to be reviewed based upon the service desired. We have learned from prior experience that outsourcing can lead to “out-of-control” situations as the LA Fire contract demonstrates. Nevertheless, periodically this type of analysis can be positive in analyzing what could be done internally verses externally.””
Desiree “Dez” Myers
“DESIREE “DEZ” MYERS
”a) hiring policy
Yes. Based on:
o An operational Review: determine required staffing / skills
o HR’s (human resource) report of gaps, sourcing options and recommendations
b) latitude Council accords Staff running organization?
Council’s job: appropriate funding, approve contracts and establish policy
Council should be responsive to residents. Council should help resolve large problems to reach a policy decision, such as pensions.
Staff’s job is to execute on policy
The City Manager directs his staff, Council does not.
Staff has taken on unauthorized initiatives without Council approval (gifting public land, reducing services, etc.) and signed a contract with the state to replan our lots again (SB2). Why?
Financial and operational controls are needed that effectively establish boundaries to ensure staff does not step on Council’s authority.
c) attract talented committed personnel
This issue should be addressed in the HR report noted above. The report should include identifying solutions in the interim and long term.
My experience is that employees value meaningful work and a supportive manager.
d) How Council can foster a spirit of teamwork and positive morale
If there is a gap today, it would be beneficial to hear from HR the nature of the issue and recommendations.
e) outsource City support functions?
Residents clearly stated that retaining our local police force is a priority.
The operational review and HR’s reports will reveal other opportunities.
These opportunities and due diligence conducted transparently will build trust the city is managing existing funds effectively. “”