Budget Trouble Ahead?

A 2.9 percent increase in employee salaries in the proposed 2014 Jamestown budget represents a positive for the city government, but what does the future hold?

Earlier this month, Jamestown Mayor Sam Teresi released his executive budget. In it he detailed the total investment in employee salaries proposed in next year’s fiscal plan is $15,303,333, which was an increase of $436,532, or 2.9 percent, from the adopted 2013 budget. This amount included “buyout” payments for several long-term employees who were scheduled to retire during the coming year. The contracted buyout payments include retirees receiving additional money for unused sick and vacation time, which can add up for a retiring employee who has been a part of city government for many years.

“While retirements can provide a welcomed opportunity and means by which to restructure and downsize our operations, they also result in the loss of valuable, experienced employees and present expensive, contractually provided buyout packages that place a severe strain on the first-year-out budget,” Teresi stated in his budget message.

The “modest increase” in employee salaries for 2014, despite several challenges like retirement buyout plans, was because of restructuring and downsizing city government, Teresi stated.

“The determined effort and difficult decision of the past several years to change the way in which the city does its business, and the related reductions and streamlining of our operations, have taken significant pressure off of numerous areas in the proposed 2014 budget,” he stated. “Previous actions to restructure departments, regionalize services, eliminate positions and institute and abide by hiring freezes have dramatically impacted this executive budget plan. Had these steps not been taken during the past 14 years (the time period Teresi has been mayor), the increase in costs included in this plan would have been significantly greater and devastating.”

During his tenure as mayor, Teresi has reduced city government by 20 percent in full-time employment and has reduced appointed city officials, top management, by 50 percent. There have been 63 restructuring efforts implemented since Jan. 1, 2000. Collectively, the mayor said these initiatives have resulted in more than $5.1 million in annual, recurring savings for city taxpayers.

“All of these measures, taken together, not only help to bring a small measure of fiscal relief for local taxpayers, but also effectively forestall the need for employee layoff and the detrimental reduction in essential public services,” Teresi stated.

Despite the steps taken during his time as mayor to lower employees and budget appropriations for salaries, Teresi said trouble could be ahead for city government. One area is the fact that all six collective bargaining units supported by the city budget are currently operating under expired labor agreements. As such, any wage increases for police officers and firefighters that might be imposed through a state-mandated arbitration process have not been incorporated and reflected in the proposed 2014 budget.

“Additionally, police and fire arbitration decisions, issued over the past several years courtesy of the state public employees relations board, have ‘set the bar’ at an extremely high level, and proven to be particularly damaging to our efforts to slow and reign in skyrocketing wage and benefits packages,” Teresi stated.

The mayor said the state’s flawed and biased system governing public employees will remain a major problem and challenge in the 2014 budget. Even without a current contract in place with the six employee collective bargaining units, existing agreements cannot be scrapped.

“In accordance with the Triborough Amendment, 1982, to the New York State Taylor Law, 1968, new labor agreements must be negotiated and built upon base contracts that have evolved layer-by-layer over previous years, and quite often this is done with little or no regard to the ability of local property taxpayers to afford such wage and benefit rich packages,” Teresi stated.