Personnel - 2010 Budget Message

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As a service provider, the Township's single largest expenditure category is personnel-related costs, which comprise approximately two-thirds (67%) of the Proposed 2010 GF Budget.

The 2009 Budget provided a reduction of seven full-time positions: three Police Officers, a Commercial Code Inspector in the Building and Planning Department, a Parking Meter Maintainer in the Parking Services Department, and two Refuse Collectors. The Parking Meter Maintainer was actually retained due to operational needs, but the planned savings from this position were achieved through other vacancies. All of the other full-time positions were eliminated through attrition or the transfer of a current employee to an open vacant position or assignment elsewhere in the organization. The 2009 Budget also included the elimination of the part-time Project Coordinator position in the Township Manager’s Office, the part-time Administrative/Tax Clerk in the Finance Department and some miscellaneous part-time hours throughout the workforce.

Since September 2009, at the Township Manager’s discretion, no full-time or regular part-time vacancies have been filled with the exception of hiring five full-time Police Officer recruits to fill vacancies. This has resulted in the following 14 full-time vacant positions: five Highway Maintainers, one Police Officer, one Tree Trimmer, two Parks Maintainers, one Refuse Truck Driver, one Library Reference Assistant, one Library Children’s Assistant, one Plumbing Inspector, and the Appleford Gardener. In addition, five vacant regular part-time positions have also remained unfilled: four Library Assistants, and one School Crossing Guard.

The Proposed 2010 Budget calls for eliminating four full-time positions: the vacant Refuse Truck Driver position; two existing Refuse Collector employees; and vacant Gardener position. Appleford has arranged for alternative ways to receive the gardener services; no Township savings will be incurred by the elimination of this position, since the Appleford Committee previously reimbursed the Township the full cost of salary and benefits for the now-retired gardener. Due to the creation of the new Rear Yard Collection Fee for 2010, it is expected that three fewer regular Refuse Division workers will be needed under the assumption that most households will convert to curbside refuse and recycling collection services. Therefore, two existing full-time Refuse Collector employees will be transferred to the Highway and/or Parks Divisions to assist in these two short-staffed divisions, thus requiring no layoffs.

Due to recent experience and operational plans for 2010, the labor pool of temporary part-time workers in the Refuse Division will be reduced by -1.5 FTE, resulting in the elimination of a total of 5.5 FTE (4 full-time, and 1.5 FTE part-time) positions in the Proposed 2010 budget. Now that the Solid Waste Fee will be at full cost recovery, thus eliminating the GF subsidy, none of these 5.5 FTE are GF-related.

The remaining 10 full-time and 5 part-time vacant positions (or 12.2 FTE) noted above are recommended to remain as authorized and budgeted positions in their respective 2010 departmental budgets, but with the offsetting of the full costs of the wages and benefits to be shown as budgetary savings for 2010 in the Non-Departmental budget. In other words, the current intent, assuming service delivery levels are not unduly compromised, is to not fill these 15 vacancies during 2010.

Therefore, a total of 17.7 FTE (5.5 FTE eliminated and 12.2 FTE vacant) fewer employees than budgeted for 2009 will be maintained, or –3.5%. Including the staffing reductions in the 2009 budget, the current workforce is smaller by 23.7 FTE (or -4.7%) since 2008.

Department Position
FTE
Public Works FT Refuse Truck Driver
(1.0)
  FT Refuse Collector
(2.0)
  FT Temporary Labor Pool
(1.5)
Parks and Recreation (Appleford) FT Gardener
(1.0)
Total 
(5.5)
Department 2010 Ongoing Vacancies
FTE
Police FT Police Officer
(1.0)
  PT School Crossing Guard
(0.4)
Public Works FT Tree Trimmer
(1.0)
  FT Highway Maintainer
(5.0)
Parks and Recreation PT Parks Maintainer II
(1.0)
  PT Parks Maintainer I
(1.0)
Libraries FT Reference Assistant
(1.0)
  PT Library Assistant
(1.0)
  FT Children's Library Assistant
(1.0)
Building and Planning  FT Plumbing Inspector
(1.0)
Subtotal   
   
(14.2)
Public Works FT Refuse Collector
2.0
Total 
(12.2)
 
Total 
(17.7)

Labor Contract Provisions:

The Proposed 2010 Budget reflects a contracted annual base wage increase of +4.0% for Workers Association (WA) non-uniformed union employees. No increase in the longevity schedule is included in the labor agreement for 2010. This will be the final year of a four-year WA labor agreement (2007 through 2010). Negotiations with the 209-member WA for a new labor agreement to become effective January 1, 2011 will commence before mid-year 2010.

Due to expenditure reduction measures recommended for 2010, the 217 non-contractual full-time and regular part-time employees and non-police management are recommended to receive annual base wage increases of +2.0%, or 2% less than WA employees. This group consists of 36 management, 26 front line supervisors, 19 other full-time employees, and 136 regular part-time employees (of which 128 work at the libraries). There will be no improvement in the longevity schedule for non-union employees and non-police management employees, again foregoing the increase that was provided to comparable employees last year in the WA and FOP. Seasonal and temporary part-time employees will continue to be paid at 2009 rates.

In recent weeks, the Township and 127-member Fraternal Order of Police (FOP), Lodge 28, successfully negotiated a new three-year labor agreement (2010-2012). The 2010 annual base wage increase for uniformed non-management police officers will be +3.75%. The 2010 longevity schedule for police officers will remain unchanged. Due to expenditure reduction measures recommended for 2010, the eight police management employees will receive +3.2% (-0.55% less than police officers in the collective bargaining unit). This rate of increase will
provide all members of police management with at least the same or greater actual dollar base wage increase amounts compared to all members of the FOP. The longevity schedule for police management also remains unchanged, again foregoing the increase that was provided to members of the FOP last year.

These recommended 2010 base wage increases for non-contractual employees are estimated to save approximately $171,000 per year compared to typical raises normally provided. This is in addition to the approximately $86,000 savings included in the 2009 Budget by providing these employees with pay increases 1% lower than would typically have been provided and another $31,000 by not providing typical longevity schedule improvements. Of these amounts, approximately 90% would be GF-related.

A small allocation of funding ($15,000) is again recommended to serve as a source of funds for performance-based compensation adjustments.

Township staff has researched options for early retirement incentive programs as part of a possible workforce reduction strategy and discussed the information with the Township’s labor counsel and actuary. Current demographics of the workforce, legal requirements in structuring such a program, the probability that such a program would not meet the desired goals, and the lack of cost effectiveness in offering sufficient incentives to make such a program successful at this time all led to the decision to not recommend this course of action at this time.

Employee Health and Fringe Benefits:

After unusually high 2009 increases due to a spike in claims experience, the premium rates for employee healthcare insurance benefits in 2010 have greatly stabilized. The premium rates for the Township’s most utilized health plan, the preferred provider organization (PPO) Personal Choice plan, will actually decrease by -2.7%; the lower-cost Keystone Health Maintenance Organization (HMO) and Point of Service (POS) plans will increase +9.4%, resulting in a total overall blended rate of increase of less than +1% across the organization. All three plans have been discounted by -2% in 2010 as a direct result of achieving 2009 wellness targets for the Township through participation in the Delaware Valley Healthcare Coalition. Prescription premiums will increase +11%, with dental rising +18%, and vision benefits up +13%. The Township’s workers’ compensation costs are budgeted at $0.7 million for 2010, a moderate increase of +$59,000 over the 2009 budget. Various healthcare cost containment and savings measures were included in the new FOP labor agreement. In other cost-saving measures, travel and fees for conferences will again be reduced and minimized.

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