Oliverio for Supervisor 2018

Independent - Transparent - Fiscally Responsible

Shucking Corn

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Picture a corn field with a farmer shucking corn by hand. His focus is on shucking the corn and he does it very well. However, this farmer can only do so much in a day and thus is provided an opportunity to assemble farm equipment which will shuck more corn than present resources allow. However, to do so will mean that he will stop shucking the corn in the interim and consequently lose some portion of the crop to crows and rodents who will eat the corn if the farmer is not present.

Fortunately, our farmer has the money to pay a qualified retired farmer to assemble the farm equipment while he continues to shuc. He will soon have extra help in the field and thus be more productive. Sounds like a good plan. Our farmer is out in the field being vigilant of his farming duties, which includes warding off crows and rodents while the farm equipment is being assembled.

However, what would you say if the farmer was too proud and refused to allow a qualified retired farmer to help him assemble the farm equipment? Instead, he continues to farm the field himself into the evening hours, becoming tired and overworked. He may make a mistake while falling further behind. Hence, the farmer is never able to take advantage of augmenting his farming with the equipment and thus loses a large portion of the crops to crows and rodents.

Sounds silly to me. Why not accept qualified assistance so the farmer can do a better job in the field and remain vigilant in farming duties?

Well, this is currently the situation for our San Jose Police Department (SJPD). We have more qualified candidates who would like to join SJPD than open positions. The next step is to require a background check. Typically background checks are done by current SJPD, which means that 17 police officers are pulled from patrol. These police officers cannot be in two places at once and therefore this results in less police on patrol.

This topic among others was discussed at Public Safety committee two weeks ago. Police Chief Chris Moore would like to hire a private company to do the background checks rather than pulling police officers from patrolling the neighborhoods. The private company does this for other cities and they employ retired police officers to do much of the work and some of them are actually retired SJPD. However, the Police Officers Association objects to this and would rather pull police from patrol to do the background checks. I am told that on-duty police officers would do a better job since they have higher standards than retired police officers. However, the absence of 17 police officers from patrol creates a heavier burden on the remaining officers on patrol and less police presence on the streets.

I admire our San Jose police officers that work hard and return home safely after each shift. However, I also believe that law enforcement officials in other jurisdictions are good people as well. Retired law enforcement from the Sheriff’s office, Fremont and Mountain View, for example, are qualified to do background checks on prospective candidates for SJPD.

The idea of using retired police officers to do backgrounds triggers the process of union negotiations called meet and confer. I do not like the secrecy of meet and confer and would rather have negotiations public. In my view, the utilization of retirees should be something the city and police union could easily agree upon. I would prefer that this issue be discussed in public, rather than behind closed doors, to avoid hurt feelings and focus on more important matters.

I understand the need for union negotiations for wages and benefits. However, it does not look good when unions contest small items like assistance from retired officers or waste time and money defending people who should be terminated.

For example, the firefighters union filed a grievance for the right to have pornography in each fire station. In addition the firefighters union argued that termination of a fireman was too excessive when the civil service commission recommended he be terminated for sexual harassment of two female co-workers that included unsolicited massages, kisses, birthday spankings, and other inappropriate touching and banter. This is sad.

Making a mountain over a molehill creates negative PR for the union and in my view should be dropped since it hurts their credibility on negotiations that pertain to wages and benefits.

Influence of Society on Career Choices

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When I was a kid, I would watch the old 1950’s show, The Honeymooners. I remember one scene where the main characters, Ralph and Ed, were talking about future vocations for their children. Ralph spoke about his child going to college, while Ed said—if he had a boy—that he would get him a job working with him side by side in the sewer. At that point, the audience laughs and Ralph’s eyes bulge out. He yells that Ed is nuts for suggesting a career in the sewer.

Although parents and their children may not always agree, more often than not parents only want the best for their children. For example, it is not unusual for a parent to want their child to be a doctor or a lawyer because these occupations often offer prestige, autonomy and good pay. These occupations require an academic education rather than trade school. The 1967 film “The Graduate” comes to mind when Mr. McGuire says to Ben, “Just one word. Are you listening? Plastics. There is a great future in plastics.”

For many high school graduates, college may not be pursued. Like Ed in the Honeymooners, many in society are employed in vocations that use a trade and/or manual labor that is also mentally challenging.

Last week, the City Council approved spending money from sewer fees—not the general fund—to hire a private company for the next year to assist at the Water Pollution Control plant. These private contractors will be used to augment city staff and do tasks that current city employees will choose in the near future not to do. The contractor will also provide relief for city employees to take vacations.

In 2007, when I started on the council, I heard over and over again that the plant employees were predominantly baby boomers and that getting new staff would be a challenge. Why though? Is it not just like filling a job in any other organization?

This takes me back to the Honeymooners analogy. Out of the general population, not many people were pursuing working in the sewer system because society did not deem it a positive career. We do know that these positions require a learned skill set over time and the jobs pay well and it is literally lifetime employment.

The general public has become more interested in sewers with the connection to keeping our environment clean. I believe individuals may choose a previously overlooked vocation in the sewer system once they understand the salary and job security. However, this will not change in weeks or months; it will most likely take time to garner the skill set for senior positions.

As I have written before, there is an opportunity for veterans returning to the USA if they choose to obtain work with the city. Or, perhaps it is the chronic unemployed who get laid off during every economic downturn and want more stability. Perhaps a better use of an outside contract would go to a company to help the city set up an apprentice program, so people with entry-level skills could learn the ropes and all the positions are permanently filled.

In an organization like the city, which has thousands of employees, 11 unions and a litany of job titles, it is nearly impossible to pay certain positions more within a union because it requires negotiation. If one job classification has people who work in the Water Pollution Control Plant and also work in City Hall, the increased salary must go to both even though they are inherently two different jobs. In any other organization you could simply raise the salary of that specific job, but that is not the case in municipal government. This instead must be dealt with in the long, arduous and secretive meet-and-confer process with the union.

Issues like this one would seem to be an easy matter, where the discussion could be held in public so we could get to “yes” faster and allow everyone to understand the details easily.

Broad Support for Performance Evaluations

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After much discussion at the City Council meeting last week the Council voted in favor of having city staff study performance as a criteria when it comes to employee layoffs.

The review will determine if the City should include job performance when considering layoffs, or keep the current system in place, which is based solely on seniority. Due to budget shortfalls, the City has eliminated “vacant positions,” which were budgeted with the intention of hiring someone to fill them. Elimination of those positions generated savings, since the savings came from no longer budgeting for the positions.

As a result, the City is forced to do layoffs, based on seniority only. For example, you may have someone on the job for nine years who is under performing yet someone who has been on the job for six years and is a great worker.  The person who has been with the City for nine years will “bump” the better performing employee, in the same or different department.

In some situations the person going into the new position does not have the skill set to do the job.  This causes disruption to that department and disruption to the client (residents, business,etc). For example someone who has never stepped foot in the water pollution control plant now has a job at the plant, which requires a special skill. Skill sets and domain expertise are lost when people bump to other departments based only on seniority.

There are two points which I think get overlooked in this debate. One: My proposal does not eliminate seniority as a measurement but instead adds performance as a factor. Whether performance will be 10 percent or 20 percent of the total criteria remains to be seen. We may eventually also decide to include education and certification as well. We need some way other than months on the job to make a informed decision.

The other item being overlooked is that performance should be considered when getting a raise or a promotion—not just the current situation of layoffs. Today, salary step increases are rewarded only based on seniority.  Adding performance as a criteria should also be considered.
In addition, city staff will study the current evaluation process, which has not always been followed. Some say that evaluations do not matter since the current system is only based on seniority. I would personally be interested in a affordable software evaluation solution so that HR can track all evaluations in real time, and that there is a standard format with the option of allowing some customization of questions for specialty jobs.

I am surprised that this issue was not resolved in prior decades and that there is strong opposition from the leadership of public employee unions. Several city employees in different departments have mentioned to me that it is disappointing to work with someone who does not carry their weight.  This is about civil service rules and not about unions, however there will be a lengthy meet-and-confer discussion with the 11 unions. In comparison, the numerous building trade unions do not have seniority and bumping. Union trade members are hired and fired based on work performance.

Seniority is being raised also in Los Angeles, where the ACLU has won in court against the school district, by Mayor Antonio Villaraigosa, a former teachers union organizer. “We cannot continue to automatically guarantee lifetime employment to all teachers,” Mayor Villaraigosa said, “nor can we make decisions about assignments, transfers and layoffs solely on the basis of seniority. Tenure and seniority must be reformed or we will be left with only one option: eliminating it entirely.” If a former union organizer and now Democratic Mayor of California’s biggest city can support performance evaluations, plus 79 percent of San Jose residents, so to should the San Jose City Council.

Congratulations to Arizona-based Microchip Inc, a veteran semiconductor company. They recently located their Silicon Valley office to San Jose from Sunnyvale filling up 100,000 square feet in North San Jose.

Saturday, the Willow Glen Rams defeated the Burlingame Panthers for the division two boys varsity soccer championship. It was first championship soccer win for Willow Glen. Congratulations to Julio Morales who scored two of the three goals.

Ten seats remain unclaimed for tonight’s 6:30pm showing of “The Olmstead Legacy” at City Hall.  Please email me to hold a seat(s) atPierluigi.Oliverio@SanJoseCA.gov

http://www.theolmstedlegacy.com/

What Should the City Do With Sick Leave Payouts?

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Sick leave payouts are part of the City of San Jose budget deficit problem. These payouts do not discriminate; every employee including management accrues sick leave, and if employed with the City long enough, will be eligible for sick leave payout when they retiree. One exception is that councilmembers do not accrue sick leave.

The City of San Jose has paid over $28 million over the last two years for sick leave payouts. Upon retirement, the City pays out those sick leave hours at the current base pay plus other premium pay(s). Unfortunately, the Council/City failed to design a system that would track sick leave at the pay rate it was accrued. The City cannot go back and retroactively change the structure so that all employees sick leave is adjusted to the specific pay that their sick leave was accrued at.  In hindsight the sick leave structure should have been one that pays out sick leave on the rate it was actually earned with a maximum cap but this was not how the past Council set it up.

Two years ago, I called for capping sick leave pay outs to no more than $100,000 but there was little support to change the existing system. Any change to sick leave payouts then or now would require the City of San Jose to go through the Meet and Confer process with the unions. The Meet and Confer process can take as long as a year.

$28 million is a significant amount of money; more than the annual citywide library budget and quarter of our budget deficit. In my view, we need to change the benefits on sick leave just as we will on pensions for new employees. It should be eliminated for new employees so that it is like the private sector, a use it or lose it benefit for those that are actually sick.

So now what do we do with everyone that was promised to be paid on their accumulated sick leave hours?  There are different options, however, any change goes to the “Meet and Confer” process with the 11 Unions.

One option is to cap the amount of the payout to say no more than $100,000, or $80,000, pick your number. The other is to phase out sick leave over a number of years where the payout is reduced X percentage each year until the benefit is eliminated. Another option would be that the City pays out over time.

If the City must pay out another $14 million in sick leave this year that means we do not have $14 million to employ police or librarians to provide services to residents. Paying out another $14 million in sick leave would cause an undue burden to our residents. So instead of paying out $14 million in one lump sum I would suggest we pay it out over 10 years or roll it into the employees’ pensions. This would leave us with money on hand to keep city employees employed. Then, in the next budget year we would know the amount of the sick leave payout from the prior year and make subsequent budget cuts in the next fiscal years. However, we will have the same fiscal liability every year unless we change the current system.

Government is known for making promises it cannot keep.  People and businesses downsize or use bankruptcy to reorganize their debt and obligations. If The City is avoiding the “B” word then we must figure out a way to keep San Jose afloat, since we will continue to have $50 million increases in the pension system each year that is paid directly by the taxpayer.

Clearly if a person is about to retire, then they are getting out at a lucrative time and probably do not care about concessions. However, if you are an employee with less seniority (since merit is not a factor today) you may be more inclined to accept concessions to keep income coming in as being laid off is a 100 percent pay cut.  Only time will tell but it will all hit the fan in the next few months.

Congratulations to the Association of Legal Professionals of The City of San Jose for being the first collective bargaining group to conduct their negotiations as public meetings. I attended and was enlightened to watch as a member of the public last Thursday.

Joint Venture Silicon Valley held their annual State of Silicon Valley 2011 last Friday at the San Jose Convention Center. Much of the time was spent on how cities and counties will have hard times the next five years due to rising pension costs and decreased revenues. The outlook was grim and the notion of never recovering and delivering services the same way was discussed. Therefore they advocated outsourcing and consolidating services among cities to cut out duplicate administrative positions.

Budget Planning for 2011-2012

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Last Thursday, the council had a study session for San Jose’s 2010-2011 budget. The public meeting received little media attention. Perhaps, since the holidays are near, we only want to hear the good news…and next years budget is far from good. There is no dispute on the data—just the direction we shall choose to balance the budget.
Here is a link to the 88 page presentation given to Council by the budget office. (Click on “2011-12 Organizational & Budget Planning” to view the presentation.)

The Council was challenged by the grim financial data and gave direction to continue with the 10 percent total compensation cuts that was requested last year. This is not an additional 10 percent but rather a request to keep the current 10 percent concession that was already agreed to by some of the labor unions. The 10 percent concession that several of the unions agreed to last year were “one time only,” meaning only for this fiscal year (2010-2011) and not ongoing. The three largest unions did not accept the 10 percent reduction last year and one actually got a raise.

If the Council chose not to ask for 10 percent pay cuts and spare public safety we would layoff two of every five non-sworn positions. So two out of five librarians, attorneys, IT staff, finance, auditors, code enforcement, planning department, public works, department of transportation, economic development, community center staff, etc….This would result in 81 percent of the budget allocated to public safety. If however 10 percent total compensation cuts were achieved then 72 percent of the budget would be allocated to public safety. (Slide 32)

Outsourcing is back on the table as a way to reduce costs and keep other city departments from having more layoffs. Last year we outsourced janitorial services which resulted in a $4 million savings and the facilities are just as clean.

I made several statements from the dais that included:
• not converting employment land to housing
• eliminating discretionary funding of charities with Healthy Neighborhood Venture Funds
• not raising fees so we become uncompetitive with our neighboring cities,
• keep the jobs/revenue team in place for companies locating to San Jose,
• Council should be limited to how many memos (flavor of the day) for new policies they can submit in a year
• rank current staff workload on what is most important (selling Hayes mansion and getting out of golf business)
• allow for union negotiations to be done in public
• instead of closing fire stations or laying off police officers reduce staffing at the slower fire stations to the same staffing levels as our neighboring cities
• finalize a new retirement system for new employees
• new facilities not be opened with full staffing
• outsourcing park maintenance or look at outsourcing by attrition where we hire private contractors as people retire
• look at new revenues once Council makes the hard decisions
• over time look at taxes that have positive environmental results and not only focused on property owners like parcel taxes instead look at solid waste dumping fee and the utility tax (water, electricity & gas)

We are suffering from severe financial duress; however, we do have options, as I have shared above. Perseverance and goodwill are not dependent on budget numbers, therefore “this too shall pass.”

Arbitrator: Retired Judge or Out-of-Town Labor Lawyer?

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At first glance, modifying binding arbitration back in July was not my first choice over new pensions for new employees. I support the Mayor on fiscal issues, so voting in favor of Measure V and giving residents the opportunity to support this measure is consistent with my line of thinking.

You can read more about the San Jose fiscal reforms measure here.

In a nutshell, Measure V would put limits on outside arbitrators. During the course of the campaign I have become more and more supportive of this measure.  There are two primary reasons why it is important, neither of which are getting much publicity. One, the passage of Measure V will mandate that binding arbitration for public safety unions would be held as public meetings.  Public meetings that the taxpayer could attend and see how tax dollars are allocated.

As it stands today, even Councilmembers that you elect are not allowed to attend these meetings.

Second, Measure V would require that the current out-of-town labor lawyer acting as arbitrator be replaced with a retired judge. Most people share the belief that a judge is more fair than a lawyer. Not every judge is perfect, however, I would pick a retired judge instead of an out-of-town labor lawyer to make a final financial decision under binding arbitration.

I have known many of our public safety professionals for more than 30 years. They are good people who do good work. However, the status quo of pay and benefits increasing faster then revenue actually results in less police and less firefighters for residents. The City has a legal obligation to pay pensions and does not have money left over to hire more police or firefighters.

I would suggest moving forward that the critics of Measure V explain the value of how the current closed-door binding arbitration process overseen by an out-of-town labor lawyer is better than Mayor Reed’s suggestions that would control costs and let taxpayers in the room. Instead, those against Measure V are attempting to mislead the voting public by sending out materials that are incorrect and contradictory as reported in a Mercury News article on Sept. 12 and again on Oct. 22.

As a side note, it was announced at the council meeting last week that the city paid out $14.6 million in accrued sick leave to retirees in July. It is a record breaking year that beat last year’s all time record of $11.7 million. Next year the potential sick leave pay out could be as high as $21 million which is equal to this years entire city wide library budget.

Also expected property tax revenues next fiscal year will be approximately $194 million while payments for pensions will be approximately $250 million!  Perhaps we all write “reform pensions to hire cops” on our check this year to the Tax Collector or better yet: Vote yes on Measures V & W.