HomeMy WebLinkAbout06-14-2000 Admin Com of Whole MinutesDublin City Council
Administrative Committee Meeting of the Whole
June 14, 2000
7:30 p.m., Council Chambers
Attendin~•
Mr. Peterson, Chair
Mr. Adamek
Mrs. Boring
Marilee Chinnici-Zuercher
Mr. Reiner
Mr. McCash
Mayor Kranstuber (arrived late)
Staff Present:
Mr. Hansley, City Manager
Mr. Harding, Director of Human Resources & Procurement
Ms. Telfer, Human Resource Administrator
Ms. Crandall, City Manager Assistant
Ms. Grigsby, Finance Director
Mr. Peterson called Che meeting to order aC 7:30 p.m., noting that the purpose of tonight's
meeting is to discuss Ordinance 77-00, which was introduced at the May 15°i Council meeting
and referred to Adminisd•ative Committee for review. This ordinance amends Sections 2A and B
(wage and salary structure) of the CiCy compensation plan.
Mr. Peterson requested background from Mr. Harding.
Mr. Harding explained that the compensation amendment is being recommended to respond to a
critical issue with staff retention. Over the last several months, the City has lost several
employees. Although other factors, such as the sh'ess from high expectations, workload, and
long hours were also cited, compensation was the key factor. The marketplace has changed to
become more of a "buyer's market" for the potential candidate. This was a topic of discussion at
the November 1999 staff retreat, where senior management proposed that the City reevaluate its
policy of utilizing a compensation range of 60-65% of the marketplace. Management pointed
out that the range appears incongruent wiCh the nature of the City's goals. The pay philosophy
should reflect the City's goals and expectations. Study of this issue was also a Council goal
adopted at this year's goal setting retreat.
Management's position is that Dublin is atrend-setting City, a model form of government.
Much of what Dublin does is emulated by other cities. Any leading edge organization should not
be in a position where it is losing talented employees due Yo compensation, especially if it does
have the financial resources to reduce that kind of turnover. Dublin is a high achieving
organization, and turnover does cause a break of continuity. Exit inCerviews revealed that the
opportunity presented by other organizations for higher salaries along with a slower pace, slower
growth, and lower expectations were the reasons the decisions were made Co leave Dublin.
The pasC 120 days, staff has bean conducting a study that included a survey of 13 other cities
with 41 benchmark positions. Dublin has 84 classifications, but 41 positions were used for
Administrative Committee
April 18, 2000
Page 2
comparison proposes. Most of the cities in the study are from the Central Ohio area, as they are
the direcC competition in the labor market. A few were selected outside Che area, such as
Kettering, Blue Ash, and Centerville, because they are high-quality communities with
characteristics similar to Dublin's, such as service levels, common form of government, and
professional management. The cities surveyed were: Bexley, Gahanna, Westerville, Delaware,
Grandview Heights, Grove City, Hilliard, Upper Arlington, Reynoldsburg, Worthington, Blue
Ash, Kettering and Centerville. Factored in the survey was the PERS pick-up. The employee's
standard contribution is 8.5%, and several of those cities pay that percenC on behalf of the
employee. The survey revealed two cities were in the lead with compensation, Upper Arlington
and Westerville. Upper Arlington has the stated philosophy to compensate aC Che 90°i percentile
of the marketplace. Westerville does not have a stated philosophy, but evaluation of the pay data
revealed Chat they are paying at a minimum at the 90°i percentile; in some cases higher.
Recently, Dublin has lost several employees to Hilliard. It is difficult to determine Hilliard's pay
philosophy, but it appears they are willing to pay whatever it takes to aCtracC a candidate of
particular caliber. Also, in amending the pay ranges, it became apparent to staff that several
classificaCions were definitely too low, and eleven positions have been positioned up one or two
pay grades Co become more competitive with the marketplace. Those positions upgraded are:
accountant, from 5 to 7; accounting technician 2, from 4 to 5; budget analyst, from 6 to 7;
financial analyst, fi•om 6 to 7; building inspector, from 6 to 7; code enforcement officer, from 5
to 6; electrical inspector, from 6 to 7; engineering project inspector, from 6 Co 7; human resource
technician, from 4 to 5; procurement technician, fiom 4 to 5; traffic signal technician, from 5 Yo
6. Staff's recommendation is to adjust the present salary structure by nine percent, which would
put the City at the 80°i percentile average. The intent is to place the individual position at a point
where it is competitive with other cities. There are several components to the City's pay
structure that Mr. Harding advised to keep intact. They are: Co maintain the pay structure at the
present 13 pay grades; to maintain the uniform nine percent differential between the grades; and
Co maintain the uniform differential within Che grade, which is a 46% differential from start to
finish.
For tonight's work session, he and Ms. Grigsby have also prepared a cost projection thaC
identifies the impact to Che City of the proposed amendment over Che nexC five years. Mr.
Harding clarified Chat includes 186 non-union employees.
Mr. Reiner inquired if the employee turnover was primarily with the Planner position.
Mr. Harding responded that several planners, engineers, an accounting technician, and an
assistanC clerk of council have left the City's employmenC.
Mr. Reiner inquired if the expectation was that anine-percent increase in the range was adequate
to retain current planning staff and attract new candidates for Chis position.
Mr. Harding responded that Che survey indicates that Dublin will be positioned competitively
within the marketplace maintaining the Planner position at a pay grade 8 with Che nine-percent
grade adjustment.
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April 18, 2000
Page 3
Mr. Reiner questioned the expectation that anine-percent range increase would make the Dublin
Planner position with its high job stress and workload competitive with a Planner position in
another city. 1n addition, Dublin should have the ability to attract planners with real talent and
experience versus new college graduates.
Mr. Harding responded thaC Dublin has not had as much difficulty attracting planners as in
retaining them.
Mrs. Boring noted that because of her experience on the Planning and Zoning Commission, she
has become aware of the planners' concerns. She inquired if Mr. Harding discussed with the
individual department heads their opinions as to what would adequately resolve the hire/retention
of their staff.
Mr. Harding responded that he did not
Mrs. Boring noted that there is little incentive or future for growth within the Planning Division
itself. There are only two positions, Planner I and Planner II. The best the planner can do is get
his/her merit raise per year within the grade. She inquired if there were options available to the
City Co create incentives for growth, or avenues of progression -- perhaps titles, areas of
specialization, or another grade, aC least for this department?
Mr. Harding said this need is not borne out by the survey data. Most local governments of
Dublin's size have two grades of planners. Of course, the larger cities of Columbus and
Cincinnati have three or four pay grades.
Mr. Hansley pointed out that inserting a grade 10 and 11 for planners would move those
positions right up against the Assistant Director of Planning and the Director of Planning grades.
Mr. Harding noted that there is also a principle in classification that stales volume of work is not
a compensable factor. Volume of work is addressed by staffing. If the workload is too great,
more staff should be hired.
Mr. Peterson noted that this is one of the shortcomings with this type of compensation schedule.
It achieves fairness in some ways, but for Chose who have served a number of years and Cop out
of their grade, there is no other place the system permits them to go. So employees either leave
at some poinC in time, or the City changes the system Co retain them.
Ms. Chinnici-Zuercher stated Yhat it is a normal to have to work within the structural limitations
of an organization. If there is no opportunity for promotion, it is not uncommon for the
employee to go outside of the organization for greater opportunity.
Mr. Reiner pointed out that the moratorium in the Southwest is soon to be lifted, and the
Planning Department will be inundated with applications that have been on hold. Yet, currently,
the City's long-range Planner, Kyle Ezell, is handling Planner I cases, due to staffing shortages.
IC is essential that the City take immediate steps to alleviate the situation in this division.
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April 18, 2000
Page 4
Mr. Hansley responded that the remedy is: (1) adopting Chis amendment now, and (2) providing
money in the operating budgeC for next year to allow for the hire of additional planners, should
the caseload continue to escalate.
Mr. Reiner noted that this years budget did not provide for sufficient staff Co handle the
caseload. Can staff assure Council that the hire of three more planners at the adjusted pay grade
will solve the workload and retention problems?
Mr. Hansley said that this evaluation has to be done every two to three years, so it will likely be
necessary to address it again.
Discussion regarding the Planning Department staff needs continued.
Mr. Hansley noted that two new planners have been hired and will be starting within the next
couple of weeks.
Ms. Chinnici-Zuercher stated Chat another factor complicating the situation is The lack of speed
in hiring. These vacancies have been there for a number of months, and there is no one on the
job. Even if two planners are starting in the next couple of weeks, there has still been too long of
a Cime lag in hiring.
Mr. Harding stated that the Department heads are also juggling a heavy workload. It takes time
to review the applications and conduct the First level of interviews.
Mr. Hansley added that it is a combination problem involving both Planning and Human
Resources. Mr. Harding's office must fill the turnover positions and thirty new positions created
in the budget. The City has historically been adding 30-35 new positions per year in an attempt
to catch up. Creating 60 additional positions all at once Co solve the workload problem isn't the
answer, because Human Resources will not be able to process them. Nor is Che answer to hire
more people to process the hires through Human Resources; there is no space to accommodate
additional staff.
Ms. Chinnici-Zuercher suggested that there is empty office space within the City available to
rent.
Mr. Harding suggested Chat Council review the compensation cost projections.
Mr. Reiner asked the Planning Director how many planners would be needed to provide
adequate staffing.
Ms. Clarke responded that the hire of three planners will fill the staffing currently provided for in
the budget, but an additional three planners are needed.
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April 18, 2000
Page 5
Mr. Hansley added that the Planning Department isn't the only department understaffed. To hire
more intensely would create such a workload that Human Resources would require additional
staffing. Also, the financial impact of hiring at a much greater level would not be the $ .5
million/year of Ms. Grigsby's projection, but 3 to 6 times that.
Mr. Adamek noted that is precisely why his recommendation was to take initial steps to catch up
to that level It is not enough to look at the compensation. At the budget meetings, Council
needs to provide adequate staffing for the departments and monies to accomplish it.
Mr. Harding suggested that, in view of this discussion and what has been occurring over the past
few months, Division heads may feel encouraged to contact him and request the additional
staffing needed.
Mr. Adamek stated thaC inadequate staffing is a problem Chat has now been identified by Council,
and Council is supportive of steps to address this. It is appropriate to move forward on
additional staffing proposals.
Mr. Hansley stated that Council makes the decision on allocation of the City's revenue.
Cwrently, half of the City's Cotal budget is spent on capital improvements. Some capital projects
would have to be eliminated or delayed to accomplish the revisions in the compensation plan.
He pointed out Chat a couple of capital projects were ah-eady deferred in the draft budget for next
year to accommodate the additional employee compensation. Over five years, this is expected to
have a $5.4 million impact. There will be an even greater impact if Council approves an
additional twelve Co twenty positions next year to address staffing needs. However, the situation
is nearing a crisis point, and the proposed amendment is necessary.
Mr. Adamek noted that it is time to address this. If a couple of capital projects are delayed, so be
it. It is more important to have the correct staffing level and appropriate pay for the staff.
Ms. Chinnici-Zuercher responded thaC Council apparently has no problem with the proposed
amendmenC in the compensation structure. Their concern is that additional measures may be
needed to retain staff. The 25-40 year-old age group is noC exclusively leaving the job due to the
money. IC is a heavy workload that results in emotional overloads. These employees are not
only exhausted from the work, but have also taken on the challenges typical for this age group
with marriages, young families, and the debt of housing. In an attempt Co balance their lives,
they are forced to leave the heavy workload that exists here. An organization's management of
its human resources should take a holistic view.
Mr. McCash commented that this group does include some who are resume builders. Their stay
with Dublin will be just long enough to reflect that experience on their resume.
Mr. Hansley noted Chat with higher pay and a reasonable workload, the City will be able to keep
even the resume builders two Co three years longer, and during that time they will accomplish
significant projects for Dublin. This group also includes special events staff and mid-
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April 18, 2000
Page 6
managemenC or salaried people. Comp time isn't attractive, because there is no opportunity to
use it.
Mr. McCash inquired how many new positions would be recommended Citywide to improve the
workload.
Mr. Hansley recommended a minimum of 20-25 new positions
Mrs. Boring scaled that moving the compensation range from the 60-65°i percentile to the 80°'
percentile would not be enough. She suggested increasing the adjustment to the 85°i percentile,
pointing out that if Dublin asks 110 percent performance from its employees and responds with
only the 80°i percentile compensation, that is insufficient. WiCh the key competitors paying at 90
percent or betCer, the City should make an effort to close that gap a little more.
Mr. Hansley agreed that at 80 percent, Dublin would remain in a number three or four slot in
competition with most of the cities surveyed. This amendment addresses the situation
conservatively. However, with the addition of Che new positions, the workload will decrease to a
more desirable range.
Mr. McCash inquired if it is necessary to do a consistent increase across the board. Could a
greater increase be targeted to some critical positions? Some positions are not in jeopardy.
Mr. Harding said that it was viewed across the board, but it could be done differently. Council
determines its pay philosophy.
Ms. Chinnici-Zuercher inquired how the adjustment would be made for employees.
Mr. Harding noted Chat he and Ms. Crandall have recently evaluated the qualifications for all 185
cun-ent employees. They made a determination on the basis of what that employee would be
hired aC today in the new range based on their qualifications, and factored in their experience
with the City.
Ms. Chinnici-Zuercher asked when the new compensation levels would be implemented.
Ms. Grigsby said that Che budgeC projections assumed seven months of this year at the currenC
grades, 5 months aC the adjusted grades. If this legislaCion is passed at the June 19°i Council
meeting, allowing for the 30-day effective period, Che last pay period in July would reflect the
adjusted pay. Employees' checks would reflect Che increase in their first August pay.
Mr. Harding clarified thaC the evaluation of employee placemenC within the adjusted pay grade
will recognize the following employee qualifications: educational degree(s) and certifications,
job experience brought Co Dublin, job experience in Dublin, and how relevant all that is Co the
employee's current j ob.
Ms. Cn•igsby noted that in 1990-91, Council chose to focus on capital projects to meeC the
community's needs. The operating budget has been designed and driven by the capital
Administrative Committee
April 18, 2000
Page 7
improvement budget. They have begun working on the CIP budget this year with the assumption
that Council will approve this budgeC. The five-year projection is based on Che new pay scale
and adds an average 4.5%o merit increase to each employee's pay to project employee
compensation impact over the next five years.
Mr. McCash inquired if the projection includes a cost of living increase as well as the merit
increase.
Ms. Grigsby responded that the City does noC provide cost of living increases.
Mr. Hansley noted that the periodic adjustment of the pay structure serves as a "catch up" cost of
living acknowledgement.
[At this point, Mayor Kranstuber arrived.]
Mrs. Boring inquired if Che projected increase from income taxes on the budget is taken into
consideration. If the projected growth in revenues is seventeen percenC, then one offsets the
other.
Ms. Grigsby said that the revenues are projected conservatively.
Mrs. Boring suggested that if the City's income is growing by 15 to 17 percent annually, the City
staff should see their salaries growing in concert.
Ms. Grigsby said that the addition of staff annually does increase the operating budget. She
added that the City's position is to allow some of the increase in reserves.
Ms. Grigsby stated that, currently, there are 186 positions, with 19 unfilled. There is usually a ten
percent vacancy rate. She added that last year's payroll exceeded $14 million, and the projected
increase to next year's payroll is $1 million. The increase to this year's payroll will be $383,000.
In some departments, additions will be made to the payroll budget; in others where vacancies
have occurred, the money has already been appropriated.
Mayor Kranstuber noted that he does not believe significant increases in the City's income
should necessarily mean significant increases in City staff pay. They should still be paid at a
level appropriate with the marketplace.
Mr. Hansley said that Mrs. Boring has reflected Chat it is inappropriate to balance the City's
budget on Che back of its employees, and the City has been guilty of that over the past few years.
The recommendation should probably be that if Dublin is number one in terms of expectations, it
should be number one in salary. However, staff is not, at this time, recommending that. Staff is
proposing an amendment that places Dublin in third or fourCh place with most positions, and that
will place City employees at an average of 80 percent of the marketplace. Although Council and
the community have a 105-110% expectation range, employees have been paid at 60 to 65
percent of the markeplace rate.
Administrative Committee
April 18, 2000
Page 8
Mayor Kranstuber stated that during the past few years, it was intentional to limit dollars in the
operating budget to free up money for bridges and the Recreation Center. The present discussion
is taking a direction opposite to Chat of the Council six Co eight years ago.
Mr. Hansley responded that it is a pendulum that swings back and forth for all councils.
Adjustments are always necessary, particularly when the City is out of sync. The key symptom
is that the City is losing too many good employees. IC's a false economy to allow employees to
leave due to compensation --City services suffer. IC is important to correct this now; there is a
crisis on the horizon.
Ms. Grigsby pointed ouC that the capital improvement budget also results in a heavy workload.
Eliminating or deferring a couple of projects in the CIP will not only allow additional dollars for
the increase in employee compensation, it will also reduce the anticipated workload to some
degree.
Mrs. Boring stated that her concern is still that the proposal is an inadequate remedy.
Mr. Hansley said the current philosphy for the capital and operating budgets has been set by
Council If Council indicates that Yhey want a greater percent in the operating budget for
employee compensation and staffing, that can be done. Dublin's citizens want roads, bridges,
and facilities, but they also want adequate and satisfied staff to service them well. Almost all the
capital improvements are optional; they have been Council's choices, and Council can balance
them as they choose.
Mr. McCash commented that the need to increase salaries is obvious. It is unfortunate that good
staff have needlessly been lost, when the City has the resources to adequately compensate. In
addition, he expressed conceim that the City gives no cost of living increase, only a merit
increase. The meriC increase then merely covers the increased cost of living. Additionally, the
people who are topped out get neither. The $5.4 million is only about 4% of the City's capital
budget, and all the revenues have been projected conservatively. In past years, the City has
experienced revenues in excess of year-end projections. He suggested there are financial
resources Co provide a cost of living increase in addition to the merit raise.
Mrs. Boring inquired about the policies for compensating topped-out employees and longevity
pay.
Mr. Harding responded that the longevity pay, which is paid on the employee's anniversary,
begins with 4-6 years of service - $550.00; 7-10 years of service - $725; 11-15 years of service -
$850.00.
Mrs. Boring stated that an individual who is capped out has valuable and irreplaceable
knowledge of theirjob. She inquired if there is an option available to reclassify the individual to
a higher pay grade or an opportunity for additional bonuses.
Administrative Committee
April 18, 2000
Page 9
Mr. Harding said there is legislation that provides for bonuses for department and division head
level positions only.
Mrs. Boring asked if a position could be reclassified.
Mr. Harding responded that there have been positions reclassified, but being "copped out" is not
the appropriate reason to reclassify. The correct solution would be for Council to implement a
bonus performance program for those below the division head level who have topped out and are
performing well.
Mr. McCash noted that longevity pay of $725/year for someone who is giving 110 percent per
year is too low. Someone who is topped out should get a cost of living raise every year or they
are losing money, year to year.
Mr. Harding said that historically, City policy has been to recommend raising Che range by three
percent every other year.
Mr. McCash responded that if the City were giving that employee athree-percent increase every
other yeas, the employee would still be losing money. The standard cosC of living increase is
assumed to be, at a minimum, two percent per year.
Mr. Peterson noted that this type of pay structure must have an automatic cost of living pay raise
built into it, or a meeting like this is required every other year.
Mr. Harding said he could change the procedure to give a cost of living every year, if that is
Council's direction. His policy has been to be conservative.
Mayor Kranstuber indicated that he does not see a problem with an employee being topped out
of a pay grade. Every position eventually has its limitations.
Mr. McCash suggested this would be an appropriate time for Council to revise the cun-ent policy
to add an annual cost of living, so the employee gets something every year.
Mr. Hansley indicated that he does not see the need for a cost of living increase in addition to the
nine percent adjustment of the pay scale, at this time. Mr. Harding will return to Council in a
couple of years with a recommendation for amendments to the pay scale.
Mr. Peterson asked for Council consensus on a recommendation.
Mrs. Boring inquired if there is support to provide an increase to the 85% percentile of the
marketplace.
Mr. Peterson stated that he prefers to defer to staff's recommendation for a smaller step that will
adjust it to the 80°i percentile, with the understanding that in a couple of years, if City revenues
Administrative Committee
April 18, 2000
Page 10
continue to increase, the compensation plan will be revisited for an adjustment to a higher
percentile.
Mrs. Boring also suggested that additional staff be recommended when needed and, specifically,
to advise Council if a projecC being reviewed by Council would require additional staff.
Mr. Hansley agreed to do so
Mrs. Chinnici-Zuercher suggested thaC Council consider the option of outsourcing a project, or a
temporary hire.
Mr. Peterson indicated that additional recommendation from this Committee will be to review
the staffing impact of any future projects under consideration.
Mr. Hansley informed Council that although this compensation plan will have some impact on
Che CIP, staff has recently learned that the golf course development (roads, water lines, sewer
lines, etc.) will cost Che City significantly more than the developers estimate. Their estimate
was $3.2 million; Mr. Kindra's studies indicate it will be closer to $7 million. Mr. Smith is
reviewing the projections with Che developer. Although the plan was to have the public
infrastructure in place at the outset, some of the work may be accomplished more gradually.
Mr. Peterson adjourned the meeting at 9:45 p.m
Assistant erk Council