The article in SMDP on Wednesday, June 4, spoke of how the city is trying to fend off deficit.
Apparently, not trying very hard. All the talk is about increasing revenues, very little about decreasing expenses.
Seventy-two percent of the city’s budget goes to salaries and wages. With a budget of $526,000,000, salaries and wages would equal $378,720,000.
Looking at some details, two items stood out.
• The City pays a minimum “livable wage ” to employees and requires the City’s outside contractors to pay it also. That is fine, but how are these increases determined. This livable wage goes up $1.29 an hour in this fiscal year, which is an increase of 9.16 percent. Where did this number come from? How many extra millions of dollars does this cost the City?
Perhaps the City could look for some savings here?
• COLA (cost of living adjustment). The City gives a 3 percent annual adjustment to its employees. It did this last year, this year and projects to do it next year. By comparison, Social Security’s COLA was 1.7 percent in 2013; 1.5 percent in 2014. Three percent (3 percent) of the City’s salaries and wages of $378,720,000 is an $11,361,000 increase in salary expenses.
• It seems that the City does not use real cost of living adjustments in its COLA, as it already has spelled out next year’s adjustment as 3 percent. If it used the numbers Social Security used, 1.5 percent this past year; the COLA amount would be halved to $5,680,500. Immediate savings to the City would be $5,680,500.
How are these two numbers determined? Are they in contracts; if so with whom? Who is involved in the negotiations?
The devil in numbers is in the details. Have the City bring these details out into the light so the citizens of Santa Monica can discuss them.