PURPOSE:

 

The purpose of this report is to request City Council approval of the proposed resolutions for the Fiscal Year (FY) 2004-2005 Memorandum of Understanding (MOU) for the Burbank City Employees Association (BCEA) and the compensation packages for the Unrepresented Managers (Z) and Executives (E), including the Appointed Officials (City Manager and City Attorney).

 

BACKGROUND:

 

Beginning in March 2004, the City began the FY 2004-2005 negotiations with the various bargaining groups.   The City reached agreement with the International Brotherhood of Electrical Workers� (IBEW) in June, 2004 and with the BCEA in August, 2004.  The BCEA members ratified their agreement on August 26, 2004 and are now requesting Council approval.  For many years, it has been the City�s policy to look at four basic cornerstones when considering compensation issues for its employees: 

• The condition of the economy as reflected by the Consumer Price Index (CPI) for Los Angeles-Riverside-Orange County Urban Wage Earners and Clerical Workers from April to April, 2004. This year, that CPI was 2.40%. 

• The capacity in the City�s approved budget is another criterion utilized in setting compensation for employees.  In FY 2004-2005 the City projected deficits and each department implemented two to four percent (2.00�4.00%) budget reductions to mitigate this situation.  As such, the City�s tight fiscal restraints were a determining factor in the compensation packages proposed for this Fiscal Year.

• Commitment to pay for performance is an on-going philosophy for the City.  In order to recruit and maintain quality employees to serve the needs of the community and citizens it is vital that we maintain this commitment even in the face of fiscal adversity. 

• Equity in the marketplace as determined by market survey is the fourth criteria the City utilizes in setting compensation for employees.   In addition to the City�s own fiscal issues as cited above, the State is still grappling with a huge budget deficit which will continue to impact local governments.  As such, the ability to pay market wages is and continues to be hampered by these budgetary considerations.  As a result of these constraints, the City decided not to survey the marketplace salaries for 2004-05, and instead continue to work on bringing salaries closer to the 2003-04 market survey. 

ANALYSIS AND CONCLUSION:

 

Within this difficult financial framework, staff is proposing City Council approval of economic packages for the BCEA, Unrepresented Managers, and Executives (including the appointed positions for City Manager and City Attorney) not to exceed 2.52% of the General Fund.

 

HIGHLIGHTS OF THE BCEA MOU:

The BCEA compensation package (Exhibit A) ratified by the members, is divided into the following components:  a 2.40% (CPI) salary increase and up to $75 per month for any eligible member to continue the out of pocket medical insurance premium supplement through September 30, 2004 (.12%).   The total percent General Fund increase for the BCEA package would be 2.52%.  However, it should be noted that only 2.40% of this package is re-occurring dollars. 

 

HIGHLIGHTS OF UNREPRESENTED MANAGERS (Z) COMPENSATION PACKAGE

In 2003-04, a 12 city survey (Anaheim, Garden Grove, Glendale, Inglewood, Long Beach, Pasadena, Riverside, San Bernardino, Santa Ana, Santa Monica, Torrance, and Huntington Beach) was completed for the Unrepresented Managers (Z).  In 2003�04, these managers were brought to approximately 40% of the total average market survey.   A 2.50% General Fund impact for FY 2004�05, would bring these same managers to approximately 98% of the 2003�04 survey (Exhibit B).  However, it should be noted that these survey adjustments would only be in the ranges and any actual employee adjustments would be based on performance and require an evaluation approved by the Department Director.

 

The Unrepresented Managers were polled regarding their interest in converting their professional development funds ($525/annually) to increase cafeteria dollars ($43.75/month) to a total of $596.94 in order to help offset rising medical premiums over the past several years.   This group supported this conversion which will eliminate Professional Development and reduce costs associated with the administration of this program.  

 

In the past, Police Captains have received survey adjustments in range that are at least equal to what the Burbank Police Officers Association (BPOA) negotiated.  However, as an agreement has not been reached with the BPOA to date, the Police Captains will receive a

 

pro-rated share of the 2.50% range adjustment based upon their 2003�04 market survey. When agreement is reached with the BPOA, the Police Captain�s salary may have to be re-examined at that time for an equity adjustment.  Another adjustment to the Police Captain compensation is an increase from $400 dollars a month to $500 a month (.02% or $1,200) for the assignment of Deputy Police Chief.

 

Also, the Assistant Public Works Director � Traffic Engineer has received a survey adjustment to maintain its internal equity (10.00% above) to the BMA classification of Principal Civil Engineer.  However, as the BMA is currently at impasse, the Assistant Public Works Director � Traffic Engineer will receive a pro-rated share of the 2.50% range adjustment based upon the 2003-04 market survey.  When an agreement is reached with the BMA, the Traffic Engineer salary may have to be re-examined at that time for an equity adjustment.  However, this adjustment will not impact the General Fund as the equity will be funded by a non-general fund account.

 

In addition to the economic portion of the package, there are some proposed changes to language contained in previous Resolutions.  These changes include the following: 

• Current language allows at least a 5.00% salary increase when promoted with the seniority held (maximum 5.00%) in the previous position carried forward to the new classification.  What this means is that when an unrepresented manager is promoted they will receive a salary increase ranging from 5.00% - 10.00%.  However, under the current language they can then be due an evaluation and subsequent salary increase in as little as one month if they were to carry forward sufficient seniority (11 months) from their previous position.  As it is unrealistic to evaluate and recommend a salary increase for an employee who has only been performing a job for one month, it is proposed that the language be modified similar to the Burbank Management Association (BMA) promotional placement language as shown in the attached Resolution (i.e. Allows at least a 5.00% salary increase when promoted, but requires Department Director approval for any higher placement not to exceed 10.00%; and subsequent salary considerations shall be one (1) year from the date of the promotion).

• Police Captains may continue to participate in the Voluntary Employee Benefit Association (VEBA).  However, VEBA participation will no longer be available to other Unrepresented Managers.  This language change is necessary as the City anticipates replacing the VEBA with a Retirement Health Savings (RHS) Plan in the near future.    

The total percent General Fund increase for the Unrepresented Managers package would be 2.52%.  However, $ 1,200 (.02%) is for the Deputy Police Chief assignment adjustment which was previously approved in the FY 2004�05 budget.