Thursday, January 10, 2008

Catherine Wilson, Bureau Chief
Northern Westchester

Local Town Budgets: Salaries and Benefits of Local Officials

The brouhaha over compensation to members of the County Board of Legislators raises the issue of how all local government employees are being compensated. It also raises the question of how a town resident can access salary data for local towns.

Almost all towns provided at least a summary of the town budget when requested by The Guardian. But the information provided for what local government representatives and employees are being paid varies greatly across Northern Westchester towns. Mt. Pleasant, Pound Ridge, and Croton-on-Hudson only provided summaries of their budgets. In contrast, Lewisboro, Ossining, Somers, North Castle, Sleepy Hollow, and Bedford provided fully detailed budgets and supporting schedules. However, New Castle, Mount Kisco, and Cortlandt did not respond to requests for information nor did they provide this information online. Peekskill, Yorktown, and North Salem offered to forward their budgets by regular mail; however, they were not received by press time.

Most of the detailed town budgets reviewed were complex and lengthy – some towns, such as Ossining, had budgets that were over 100 pages long. Finding the salaries of town officials amidst such detail requires some degree of accounting knowledge. But only one of the budgets, from the Village of Sleepy Hollow, came with a page by page summary of the contents for easy reference.

The salary and benefits information provided in local town budgets varies dramatically. Some towns merely provide a two-to-three page summary of the town revenues and expenses by department and category. A resident of Mt. Pleasant cannot tell from looking at the town’s budget summary what the town officials are earning or what the town is spending for employee benefits. In contrast, Croton-on-Hudson’s summary includes a schedule of the salaries of town officials from the village manager’s salary of $176,029 to the village trustees at $3,000 each. However, some towns, such as Bedford, provided salary data by town department and function, and also included schedules for the salary of each employee position. Bedford’s budget schedules also included details of actual salaries by employee for the prior year so that town residents could see the annual raises for each staff position.

One of the reasons local towns are giving for the dramatic tax increases in 2008 are increasing employee benefit costs. Yet only a few towns, such as Bedford, provide a full detailed schedule for overall benefits paid. A quick review of Bedford’s employee benefits shows that their employee dental insurance costs are expected to increase $16,375 from 2006 to 2008 – a 25% increase, and their police retirement fund is expected to increase $132,694, or 20%, over the same period. Bedford also provides a full breakdown of the salaries for all members of the police department, including their longevity and holiday pay.

Such detailed information allows town residents to see where the increases in taxes are generated and what to expect in the way of future increases (e.g. higher longevity pay for employees equates to higher pension costs). Given that employee benefits are partially responsible for rising property taxes locally, residents should expect a full reporting of these benefits from their towns including what town employees are expected to contribute towards those benefits. In a news release last week, Buchanan announced that it was “looking at the possibility of having municipal workers contribute to their health insurance plans” as a possible cost-cutting measure. That announcement would possibly come as a surprise to most town residents who already subsidize their own benefits, either partially or in full. According to the Kaiser Foundation

2007 Summary of Findings, “80% of workers with single coverage and 94% of workers with family coverage contribute to the total premium for their coverage. The average annual worker contributions for single and family coverage are $694 and $3,291, respectively”.

Those numbers represent a national average across small businesses and large organizations. According to the Kaiser study, while only 56%
of small businesses expect their employees to contribute to their single coverage, 87% expect employees to contribute towards family coverage. Indeed the trend in small firms is to have employees pay the full extra cost of any family coverage – it is not unusual for local employees to pay $1,000 a month or more for family health coverage. In addition, according to Kaiser, “most covered workers face additional payments when they use health care services. In PPO’s, 71% of covered workers have a general annual deductible or other forms of cost sharing for office visits and other services”. Those deductibles and co-pays can add thousands of dollars per year to a local family’s medical costs.

But these costs only apply to local residents who actually have health insurance coverage through their places of employment. Again, according to the Kaiser study, only 45% of very small firms and 59% of small firms offer any health insurance benefits to their employees at all. Plus the large force of part-time workers, freelancers, and independent contractors all must provide their own insurance.

Those local residents face even higher health insurance costs, assuming they can afford coverage at all. These taxpayers would be justifiably concerned that their rising property taxes are going towards health insurance benefits for town employees who are not contributing at all towards those benefits. In these instances, the local residents are not only paying for their own personal health insurance but also paying for the insurance of town employees and even for the health insurance for the town employees’ family members – individuals who may not work for the town at all.

The town budgets alone will not reveal the full employee benefit information since the bulk of these costs are determined by union contracts.
In addition to annual budgets and detailed salary schedules, all local towns should also provide full union contract details online for the
taxpayers’ information. This information can be obtained online from the larger unions - e.g., the annual contract for the Westchester County
court employees can be viewed at www.csealocal1000.org/ca/ucs_contract_03_07.pdf. But again, only someone with a level of accounting
ability, and an expertise in government accounting, would be able to decipher this information. Given that these contracts determine the bulk of our local budgets, this information should be more accessible and more “user-friendly” and comparable.

Ideally, if all Westchester towns reported their financial information in the same fashion with the same level of detail, including salaries, benefits, and union contracts, residents could compare how their town is spending compared to similar towns in the county. Such comparisons would enable residents to determine where the excesses in the budgets exist.

For example, a comparison of some local town budgets to the county budget exposes a wide discrepancy in salaries for board positions. e
Chairman of the County board of legislators, Bill Ryan, has requested a salary increase for his part-time position from $89,200 to $124,000.
However, the existing salaries of the County Board Of Legislators already outstrips their town counterparts dramatically. Board members in local towns oversee budgets and contracts, approve changes to the town bylaws, approve the hiring of consultants and
the appointment of committees, etc.

The Town of Mt. Pleasant lists the responsibilities of the Town Board members as follows: The Town Board is the legislative, appropriating, governing and policy determining body of the Town and consists of four board members, elected at large to serve a four year term, plus the Supervisor. Town Board members may serve an unlimited number of terms. It is the responsibility of the Town Board to enact, by resolution, all legislation including ordinances and local laws. Annual operating budgets for the Town must be approved by the
Town Board; modifications and transfers between budgetary appropriations also must be authorized by the Town Board on the recommendation of the supervisor. The original issuance of all Town indebtedness is subject to approval by the Town Board.

In short, the board members of our local communities do essentially the same jobs as their County counterparts for a fraction of the pay. The
following are some individual salaries from around the county:

Croton-On-Hudson: $3,000 (4 town trustees)

Bedford: $16,711 (4 councilpersons)

Lewisboro: $13,000 (4 board members)

Somers: $12,182 (4 board members)

Sleepy Hollow: $5,000 (6 town trustees)

North Castle: $19,455 (4 councilpersons)

Ossining: $11,404 (4 board members)

Westchester County Board: $49,200 (17 Board members – base pay)

When local residents have access to similar details for neighboring towns, the analysis is evident. Given the above facts, a resident of Sleepy
Hollow would ask why their town has six trustees while other, much larger, towns have only four. And a resident of North Castle would want to know why their town councilpersons are being paid $8,000 more per year than the same positions in Ossining.

And all Westchester residents would ask why the County Board members need a minimum of $49,200 each per year while town board members can do the same jobs for at least $30,000 less. If union contracts are added into the mix, local residents could compare limits on overtime, benefit contributions, pension plan calculations, and so on. With such information, taxpayers could hold town employees accountable for their tax dollars.

Some local officials do recognize their responsibility to be accountable to local residents. Paul Feiner, the Supervisor of the Town of Greenburgh, sets a list of goals for his job every year and links his salary to his performance. If he fails to achieve all of those goals, Mr. Feiner refunds a portion of his salary – he recently announced he was refunding $1,376 of his 2007 salary to the town. This practice of “Management by Objectives” was established by the Harvard Business School in the 1980’s and has been widely adopted by “corporate
America” for all levels of staff.

Linking performance accountability to compensation is not without its detractors, however. The outgoing Greenburgh town board member,
Steve Bass, noted that while “it’s not a bad thing to set goals”, too much time could be spent on addressing the goals and “distract from (the) serious problems.”

Mr. Bass, an assistant with the Westchester County Board of Legislators, believes that “day to day matters,” such as addressing budget and
tax concerns, should not be part of “performance goals.” But taxpayers may want to hold their government officials and town employees personally responsible for the increases in local budgets and taxes.

In many companies where compensation linked to performance is used, employees who do not successfully complete their goals lose out on
the bonuses tied to those goals. But it is not enough for employees to attend to just the “day to day matters” of their jobs. Even employees who do their full jobs but do not complete a specified amount of their goals forfeit their annual salary increases. For Corporate America, doing 100% is no longer enough.

Westchester County now has the distinction of having the highest property taxes of any county in the nation. With such a burden, taxpayers should expect complete and full disclosure and full accountability from their towns (and the county) of all expenditures at all levels. Taxpayers should receive online copies of all budgets and union contracts well in advance of any board meetings and votes. Each community should provide email notices to their residents of budget and contract meetings and votes and when the budgets and contracts are available
online for review so that residents can ask informed questions at their town meetings. In addition, all information should be provided in set formats with the same level of details countywide, and union-wide, so that taxpayers can easily make comparisons.

The County Board Of Legislators could set a performance goal for themselves this year to adopt across-the-board standards for reporting local budgets using Sleepy Hollow, Ossining, North Castle, and Lewisboro as their guides. Finally, taxpayers should have annual guarantees from local officials and government employees at all levels linking any individual salary raises to performance goals set by the taxpayers. It is not unreasonable for a County resident to ask what a union member will do for their contractual salary increases, or to ask if the Board Of Legislators expects $49,200 (base salary) per year to $89,200 (Chairperson’s salary) for their parttime jobs, what precisely have they been doing for that money? And if the officials don’t do as they promise, or the employees don’t perform as expected, will the taxpayers’ get that
money back?

Northern Westchester Round-Up

Buchanan: Indian Point officials announced that their workers have transferred used nuclear fuel rods to dry-cask storage. The rods,
which were first cooled in pools of water, drained, dried and placed inside the helium casks, are now being stored in an on-site concrete
facility.

Carmel: New York State Assemblyman, Greg Ball, announced that he will run for reelection to the NYS Assembly in 2008 and not run for
the United States Congress as was previously speculated. Assemblyman Ball represents the 99th District which encompasses parts of Putnam and Dutchess counties as well as the northern Westchester towns of Yorktown, Somers, and North Salem.

Cortlandt: Town officials announced the formation of a diversity task force following the cross-burning incident last November. The task force will be comprised of local business, clergy, and law enforcement representatives.

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