Even through the lowest points of this bad economy the City of Oakley’s financial situation has remained stable. We never went through mass staff layoffs; we never compromised public safety by reducing the size of our police force; we are not financially constrained by unfunded liabilities for pensions and other retirement benefits like so many other cities and counties are (as of October 2010 the City create a new “Tier 2” CalPERS plan of 2% at 60 for all new employees) ; and unlike many neighboring cities and agencies, the City of Oakley has at no time during this economic downturn asked for a tax increase of any kind to weather the storm.
Instead, our small business-like approach of employing a small, engaged Staff contributed to our ability to weather the storm. Changes such as some reductions in staff, adjustments to contracted services and the restructuring of staffing operations (many staff wearing multiple hats) poised us to make it through. We have maintained a balanced budget and a healthy reserve in every year since incorporation.
The City has two major sources of revenues; property taxes and sales taxes. These two sources have been on the rise and are projected to continue to rise.
As reported in the January 30 online edition of The Wall Street Journal home prices in Oakley are up 23.7% over the last year – one of the higher growth rates in the Bay Area. Of the 107 cities in the Bay Area, Oakley places 21st on the big bounce list. In Contra Costa County only Richmond placed higher on the list.
Beginning March 20, 2009 all employees, except certain Police Department and limited service employees, were mandatorily furloughed from work on an unpaid basis the third Friday of every month. Vacation, sick, or administrative leave, or floating holiday or compensatory time may not be used by the employees.
A year-end furlough was also implemented. During the Year-End furlough employees could utilize vacation leave, administrative leave, floating holiday hours or compensatory time, if available, and effectively be paid for the regular work days during this period. Any employee who did not have the necessary accruals received time off without pay. This combined furlough program resulted in an average 22-23 annual furlough days and a 5 percent reduction in salary for an already lean Staff team. This furlough program has been in place for the last 4 years and during this time the City’s compensation policy was also suspended.
During this same 4 year period there have been staff reductions. In 2009 Oakley had 36 employees, today there are 29. The combined staff reductions and furlough program has resulted in at least a savings of $350,000 each year during this period.
We are glad to be in a financial situation that will now allow us to suspend the furlough program resuming our Staff to a full 40 hour week year round, consequently also being available to our public. Of course the Council reserves the right to reinitiate the program should economic challenges resurface.
However, as we will be asking the Staff to work those additional 8 hours we believe it fair to compensate them for those hours, thus this action would not be accurately deemed a raise.
Consistent with our compensation policy, seven employees will see some level of increase to their pay after having updated our salary ranges. This stems from the fact that a market analysis demonstrated our compensation of those employees as not meeting even the average of the minimum salaries of their counterparts performing the same work in 6 comparable cities (Antioch, Benicia, Brentwood, Hercules, Pleasant Hill, and Pittsburg).
All of our comparison cities have what is known as a step pay grade system. Pay grades provide a framework for compensation by defining the amount of pay available at each step in the employment process. For instance: An employee who is new to a job in a particular pay grade range starts at pay step one of the pay grade. If he or she continues to work in the same role, the pay grade allows upward movement in salary, usually one pay step per year of service within the pay grade assigned to that job. Compensation systems involving pay grades are often used within public sector employment. Oakley does not use this system for pay increases.
While the ranges were updated both on the minimum and high end with averages, unlike most cities with unions we do not offer automatic pay grade/step increases which are typically of 5% per employee per year. There were no merit increases; instead we decided to pay a 2% employee contribution towards PERS and $35 towards their health benefit which too was found to be uncompetitive ($500 less than the average contribution of the 6 cities). We pursued these actions recognizing that having provided a direct raise would have only increased the base salary and consequently the City’s contribution to PERS as well.
While Oakley is small, local governments are faced with many challenges that can be averted, tackled, and overcome through a competent Staff. We only attempt to retain proven and loyal talent for the most efficacious delivery of services to our residents.