City strategic planning session ends on a hopeful note

March 03--San Angelo -- The City of San Angelo Strategic Planning Session on Thursday, March 2, started with bad news: the city's year-to-date sales tax revenue is down by $416,222.

City Manager Daniel Valenzuela expects that number to keep growing if sales taxes keep moving in the direction they have in recent months.

"If we don't have the money to do what we are obligated to do, then it's no use listing what we wish to do," said Mayor Dwain Morrison, who called the sales tax numbers very revealing. "We have no money."

Councilwoman Charlotte Farmer offered a counter argument. "Whether we have the money or not, it still pays to have a plan in place so we are ready to act when the funding becomes available," she said.

One obligation hanging over City Council's head is a previously negotiated raise -- due in 2016 -- that would have brought San Angelo police officers' pay up to 95 percent of what comparable cities pay their police forces. City staff said the pay increases for the police department would have cost about $635,960, but the city had only $322,946 in unallocated funds available last year.

In the end, police representatives ratified a contract amendment deferring the raise until April 1, 2017. By deferring, the amount was reduced to about $317,000 over six months. Council directed that the $322,946 be put toward health insurance premiums for city employees -- including SAPD officers -- and retirees because that would spread the money out and benefit the most people.

With less than a month until the April 1 deadline, the city was scrambling. Lisa Marley -- the city's director of human resources, risk management and civil service -- informed attendees Thursday that if an agreement is not reached by April 1, the previous agreement becomes null and void. She said while the salaries would likely not be impacted, benefits gained under meet-and-confer negotiations could revert to 2013 levels. The San Angelo Police Department would stand to lose an assistant chief position and such things as SWAT pay, bilingual pay for Spanish-language skills and part-time officers.

Police Chief Frank Carter said at the meeting that a new police department building is not a priority for him at this time.

"We can make do with the police department. My priorities are competitive salaries, pay raises and additional manpower." ~ SAPD Police Chief Frank Carter.

"We can make do with the police department. My priorities are competitive salaries, pay raises and additional manpower," he said, adding that the department is already short staffed and he expects to lose more people soon.

Renovating the First Financial Bank facility at 301 W. Beauregard Ave. -- the proposed locations for the police department -- would cost about $38-$39 million. Carter asked that the city take any money it may have put aside for the SAPD renovation and put it toward pay and staffing increases.

However, city staff said no money had been set aside for the renovations. Instead, the city had planned to present voters with a bond election to approve the financing of a police station.

"I think the (bank) building in its current state would better serve other city offices. It's move-in ready. It would be less burden on the taxpayer in a down economy," Carter said. "I say we watch the economy. I want to look at some of the properties available that the city owns ... look at this project again down the road. "

In the end, the council decided to consider an alternate use for the bank building. The city's Public Works Department -- consisting of water, sewer, operations and engineering -- could move into the building. Because they need office space and counter space for serving customers, the building is pretty much move-in ready. City staff will also look to see which other departments have space needs and consider the option of Municipal Court also moving there. According to staff, Tom Green County has also made some inquiries about available space as it works on renovating county facilities.

However, Valenzuela assured everyone that the city will work towards finding a solution for SAPD pay raise and other issues as much as possible. "We are taking a real hard look to see how we can reduce our current expenditure," he said.

Finance Director Tina Dierschke then gave attendees an update about cost cutting measures the city has already worked on -- reduced travel per diem (daily expense allowance) and mileage rates, updated fuel purchase policy and cell phone stipends that also save the city money. All together the savings from these measures would amount to $50,000, she estimated.

On Jan. 23, Marley sent out a memo that a hiring freeze for all departments (excluding Fire and Police) was effective immediately until further notice. The city manager is monitoring all hiring.

"Year-to-date as far as salary savings, we've seen about $100,000 of savings there," Dierschke said. "And moving forward I think we could safely expect to see another $100,000 saving with him carefully reviewing every position that we hire."

She said the only other cost-cutting options available would be decreasing services offered by the city or increasing property taxes, unless there happened to be a dramatic increase in some other sustainable revenue source. DIerschke also pointed out "that the property tax revenue we do bring in isn't even enough to cover the cost of public safety."

"Once we give this pay increase, it'll be a permanent expenditure on the books and whatever we reduce (to make it happen) will be a permanent reduction," Valenzuela added.

That did not sit well with the mayor. "I think we're likely to shoot ourselves in the foot if we start taking away some of the services that we provide and start charging on others on top of it," Morrison said, adding that he was definitely against a tax increase. While the city was obligated for the SAPD pay increase, Morrison didn't want to leave out the Fire department, which is also short-staffed, and the non-public safety employees.

"When the wastewater guy is up to his waist in wastewater because he's working on something, he's pretty important," he said.

Instead of a pay increase to go on the payroll, the mayor suggested these one-time stipends:

The police would get their half-a-year amount of $317,000

Fire personnel would get a half-year adjustment at a 5 percent rate for a total of $250,000.

Other employees would get a 3 percent increase, adding up to about $290,000.

The total expenditure would be about $850,000.

"It would be a one-time thing. It'll not become part of their salary or payroll because I don't want to saddle the next council with having to come up with all this extra money," Morrison said. "It would be a good-faith effort on our part. We know what we owe, we would like to help, but we don't have the money, this is simply all we can do."

"It gives you something, it's not what they want, but it's certainly better than nothing," he said.

Assistant City Manager Michael Dane supported the idea. "Because you don't create that future obligation, you don't have to create savings which are permanent," he said. "They can be one-time savings. I think you have struck on something that's very doable."

Marley agreed. "In 2010, when we could not meet our obligations for meet-and-confer, we did a one-time stipend for all police officers on a graduated scale based on seniority," she said. "The $317,000 as stipend would be equivalent to our obligations in this contract." However, it would be up to the present meet-and-confer SAPD representatives whether they'd accept the offer.

She said she will work to set up the required meet-and-confer meeting to get it done this month so that SAPD representatives can decide what to do and then take it back for their membership to vote on. Then a second meet-and-confer session would be set up between the city and SAPD representatives to accept the result, which would then be brought to the City Council. She was optimistic that she could include it on the agenda for the March 21 council meeting. Councilman Marty Self also asked her to see if she could extend the deadline beyond April 1.

Dane said the SAPD salary figures shared were from the previous fiscal year and will have to be updated because employees have retired or joined since then, and the staff will be working to cut costs to pay for this stipend without affecting services or raising taxes.

The council unanimously voted in favor of the plan and asked city staff to find the money to make this organization-wide stipend happen as soon as possible.

They also decided to continue with their previous year's priorities:

* Water Supply

* Street Rehab/Recon and Maintenance Plan

* Police Station (renovation of the existing department building and consideration of other options)

* Competitive Salaries

* Development Process Improvement.

However, because the May municipal elections could bring in anywhere from three to five new people on the council, members decided the priorities will be revisited again later in the year to get everyone up to speed and be able to give their input.

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