How Can The St. Pete Administration Cut The Budget?

Two administrations, Baker and Foster, have tried to wait this thing out hoping something magical would happen. There is no magic bullet, it's time to act.

For the past few years the City administration has used the traditional budget balancing methods of reducing capital expenditures, eliminating training budgets and reducing general operating expenses. There have been a significant number of staff reductions including eliminating positions, resignations and retirements. But the administration has run out of quick fixes. 

There have been calls to use the City's massive reserves to defray operating expenses, but Mayors and City Councils have generally shied away from this as a bad business practice since it really just pushes the problem down the road. 

The private sector for decades has used a combination of plans to incentivize people to leave the payroll. These plans allow those at or near retirement to leave early or if they have just been hanging around, like a lot of City employees, it encourages them to leave.  

Three steps To Transforming the City Administration

1. Determine the total amount of savings necessary to bring both the 2013 and estimated 2014 budgets into balance. 

2. Look at the entire MANAGEMENT team and reduce the number of supervisors and managers, Majors, Captains, Assistant Chiefs, District Chiefs and  administrators to meet that goal. As a general rule of thumb reduce:

  • 2 senior administrators, and their support staff such as secretaries and assistants.
  • 1 manger in every 5 and their support staff such as secretaries.
  • 1 supervisor in every 8.
  • Public safety must participate but only with senior staff such as Assistant Chiefs, District Chiefs, and Majors, Captains, and civilian managers and supervisors.
  • Once identified these people must leave the organization.
  • No cut and shuffle leaving them hidden away on the payroll.
3. How?
  • Put together a viable incentive program that adds significantly to the normal termination pay and will encourage people to leave.
  • Don't worry about people walking away with large sums of money. This thinking is a holdover from the David Fisher Administration and is last century's thinking .
  • These payouts are investments in the City's future .
  • Identify those whose positions are being cut, inform them of the decision, and they will have 1 month to take the incentive package or simply be removed from the payroll.
  • Take whatever amount is necessary to fund the incentives and termination pay from the reserve funds.
  • This approach creates permanent solution to the problem, blunts the argument against using reserve funds, because this program is a onetime effort that resolves the budget problem going forward .
  • The pay back on this investment should be 100% in less than three years.
  • Do not hire a consultant to study or do this - just do it.
  • Maintain a hard hiring freeze for at least 24 months.

Draconian? Insensitive? Uncaring? Perhaps. But if Bill Foster had had the courage to take similar steps when he came to office, there is a good chance the budget would be balanced and maybe even running a slight surplus. 

Two administrations, Baker and Foster, have tried to wait this thing out hoping something magical would happen. There is no magic bullet, it's time to act. 

e-mail Doc at: dr.webb@verizon.net, or send me a Facebook Friend Request.

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Concerned Floridian September 24, 2012 at 03:57 PM
Ripley, please clarify your argument. Are you saying that top-levels city executives are underpaid compared to private industry and burnt out & unmotivated due to this, while lower-levels have competitive salaries but are nevertheless not-motivated due to poor leadership at the top? If so, I don't agree. That argument has been served to citizens, time and time again by the city administration [be it the mayor or certain citycouncil members] - at best, this is self-serving and at worst it denotes a lack of managerial creativity to uplift productivity.
S. Ripley September 24, 2012 at 04:47 PM
Concerned Floridian – you paraphrased me perfectly. But to add clarity: the top-levels are mostly staffed by those who can't cut it in the private sector (where managerial creativity is required). I’m not advocating increasing their pay- but the pay for the position, and then find qualified candidates to replace them. That said- my comments are generalizations. There are a few superstars working at the city, unfortunately they are the exception, not the rule. Over time, even these folks will tire of the low pay and BS and will find something better. Final point: You are correct, that argument has been made several times. And despite the inherent truth it will never get any popluar support, which is why things are unlikely to ever change.
Concerned Floridian September 26, 2012 at 07:50 PM
Ripley, are you suggesting that the city embarks in the business of offering paid positions at a as much indecent level as what is offered in the private industry so to compete for the same, and maybe not so recommendable, white-collars folks? I don't see this as the solution, per se. Nor as being the ultimate attraction or retention tool for good administrators and good trustees of city resources. The city risks ending up attracting the same highly incompetent (some even say criminal) people from the private industry who earn highly indecent wages & other compensations, incl. bonus, based on 'they know so much!' Just be reminded of whom were behind the recent financial debacle? The ones who where the artisans of such debacle received hefty bonus at end-year, no matter how culprit and responsible they were in/for the inflated economy resting on a bubble. So imaginative are these folks that they created fantasy economies. And we had to bail them out, under the same argument you advocated that high compensations were needed to keep these 'knowledgeable' folks at the helm of the sinking ships [paraphrasing Obama's rhetoric at the time of the massive bailouts].
S. Ripley September 26, 2012 at 09:12 PM
Well that is quite a stretch-- and an entertaining analogy (albeit an invalid one). But as this is just a place for bloggers and blather, by all means enjoy yourself. Time for me to move on.
Concerned Floridian September 26, 2012 at 09:21 PM
Same here.


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