February 9, 2006

City Council to consider salary increases
for appointed officials next month

Cortese and others want cost-of-living
indexing, other less rigid options

By Sheila Sanchez
Staff Writer

San Jose’s six appointed officials will have to wait another month to find out whether the City Council will give them merit pay increases during the 2005-06 fiscal year.

Councilman David Cortese made a motion during Tuesday’s city council meeting to direct interim City Manager Les White and employee relations and services staff to provide possible merit increase indexes for cost-of-living adjustments used by other jurisdictions to guide his colleagues as they seek to make salaries competitive to other cities and counties. His proposal passed by a 9-2 vote, with Mayor Ron Gonzales and Councilman Forrest Williams voting against.

The appointed officials—White, City Clerk Lee Price, City Attorney Rick Doyle, Redevelopment Director Harry Mavrogenes, City Auditor Jerry Silva and Independent Police Auditor Barbara Attard—answer to the 10-member San Jose City Council and Mayor Ron Gonzales, who ultimately report to San Jose residents who vote and elect them to office.

Of all city appointees, former City Manager Del Borgsdorf made $212,326, followed by Mavrogenes who earns $205,920 and Doyle, Silva, Attard and Price who earn $198,474, $168,542, $145,000 and $126,173, respectively.
A proposed resolution by Gonzales and Vice Mayor Cindy Chavez, which failed Tuesday afternoon by a 7-4 vote, would have given the six executives salary adjustments of between 7 and 9 percent based on performance evaluations conducted last year.

The resolution was also seeking a generous compensation package for White, who was appointed to replace Borgsdorf on Jan. 31, as well as approval of recruitment procedures for the next city manager.

Chavez explained she was seeking the increases after receiving updated salary survey information on each appointee position from the city’s Employee Services Department. All appointees, however, have expressed concern about the fairness and accuracy of the survey.

Under the proposal that failed. Mavrogenes’ salary would have been raised by $17,503 or 8.5 percent for a total of $223,127, Doyle’s salary by $15,873 or 8 percent for a total of $214,352, Price’s salary by $11,356 or 9 percent for a total of $137,529, Silva’s salary by $15,169 or 9 percent for a total of $183,711 and Attard’s salary by $10,150 or 7 percent for a total of $155,150

Williams moved to provide the suggested merit pay increases for the executive staff with the support of Councilwoman Nancy Pyle who made an amendment that Borgsdorf be left out of it.

“We’re talking about almost $71,000 for the consideration,” Williams said, referring to the proposed merit awards for the appointed officials, except White. “Individuals train and prepare themselves to take on these positions and by so doing they earn the consideration and it’s not something that we’re giving it just to be giving it … I think it’s fair that we deal with our employees in terms of the structure. I believe it’s fair for the appointees because of the expectations and responsibilities that we compensate them as we look at them across the state and across the nation.”

But Cortese said he would entertain cost-of-living salary adjustments for all six officials retroactive to cover years when the city was operating under the old structure and gave the appointees no raises at all. It’s been two years since they have received any salary increases.

Under the resolution killed Tuesday, Borgsdorf, who stepped down in the wake of the Norcal deal, would have also received a salary adjustment to his base salary and a prorated portion of $13,801 or 6.5 percent salary increase. The salary survey found Borgsdorf’s salary to be 11 percent below average.

For White, the council was considering a total compensation package of $285,906, with a $232,000 annual salary, a $200 monthly car allowance, $1,000 in moving expenses and health and dental benefits.

The resolution was also recommending that the council begin recruiting for a permanent city manager this fall so that the next mayor and council can make an appointment by the spring of 2007. The recruitment will require the mayor’s office to retain an executive search firm, bring a contract to council for approval no later than August of 2006, conduct extensive public outreach throughout the city regarding community criteria for a candidate profile in the fall of 2006 and include community members in the 2007 candidate interview process to advise the mayor.

Williams said he thought the city already had adequate guidelines and evaluation processes to make salary adjustments for its executive staff.

But some council members were hesitant to give them the merit awards when they’re currently negotiating pay increases with some labor unions that will only give employees a 3.75 percent salary increase.

Silva, the only appointed official who spoke before the council, said his peers have not received merit pay increases since fiscal year 2002-03.

“The six council appointees were the only city employees that took a cut in pay in 2003-04,” Silva said. “We don’t get cost of living increases. Those merit increases are not added to our base pay.”

Silva called the current system, instituted by the council in 2001, “a joke.” He said it’s “inherently unfair to the six appointees.” He added that no other city the size of San Jose is under the same system and, as far as he knows, there are no other government employees in the country under the system.

And while the six appointed officials received a 1.5 percent salary increase to their base pay on July 1, 2005, most of the city’s executive staff received 1.8 percent added to their base pay with an additional 5 percent added, he said.

Compared to Unit 99, the administrative professionals bargaining unit, during the last four fiscal years, the appointees’ base pay increased by only 1.5 percent, but for Unit 99 employees, their average base pay increased by 17.4 percent.

Silva said he’s making $8,000 less this year than he did during fiscal year 2002-03. He attributed the decline in his salary to the system being used by the council to pay the appointees. “Every time an employee in this city gets a merit increase they get to keep it as part of their base pay. The appointees are the only six employees in the city who don’t.”

For his part, Williams said, “My heart goes out to those individuals. I understand not getting the kind of consideration that we so lavishly place on individuals to encourage them to come and once here we are afraid to keep that commitment. I feel strongly that we owe our appointees the consideration that’s been recommended… After two years of zero I think it’s reasonable to make that consideration.”

Gurza said 1.5 and 3.75 percent base salary adjustments for non-executive staff were negotiated with bargaining units and are general wage increases. He also said the city has not frozen merit or step increases for any employee this year.

Chavez said she believed the council appointees’ are more like council members’ jobs than like senior staff employment.

Gurza said the city’s senior staff didn’t get any salary increases during fiscal years 2003-04 and 2004-05 and that the executive management employees, such as council assistants, who were anticipating a 5 percent salary increase, ended up receiving a 3 percent jump, compared to a 6 percent increase that the bargaining unit had already negotiated.

“I’m totally understanding what I’m hearing here and I’m totally sensitive to the fact of parity and that we treat all with equal respect and honesty but I also know that … there’s a special search and criteria and a special evaluation and an interim city manager and while all employees have a right there’s additional responsibilities and stresses that go with this job,” said Councilwoman Judy Chirco. “In all fairness to all of our employees, including the appointees, we need to be thoughtful ... to be in partnership with all of our organizations because they’re the heart, the feet and the hands of the city.”

Cortese said the council needed to get out of a rigid merit structure and that private sector employees receive indexed cost-of-living adjustments avoiding debate. He suggested a standardized index separate from the bargaining unit that wouldn’t preclude them from giving merit pay increases.

Councilwoman Madison Nguyen said while she appreciated the work of the city’s appointed officials, she could not support a merit awards when the council is about to ask citizens to make sacrifices and accept reduced municipal services this year as they balance an estimated $76 million budget deficit this fiscal year.

“During these hard budgetary times I think it’s very difficult for me to justify why we’re giving higher increases to certain individuals and not to the rest of the workforce,” Nguyen said.

Gurza said the city’s senior staff receives merit bonuses after the city manager conducts performance evaluations with an average increase of about 5 percent, which goes into the base salary, for those who earned an “outstanding” performance rating. For those with satisfactory or commendable ratings, the increases were less.

Councilman Ken Yeager said he, too, believed the current merit increase is too rigid and should be revised with more information. “I want to do right by all of our employees and that certainly includes all of our appointees but I think there’s got to be some boundaries,” Yeager said.

Proposed salary recommendations for San Jose’s appointed officials Source: City of San Jose

Name Del Borgsdorf (Les White) Harry Mavrogenes Rick Doyle Gerald Silva Barbara Attard Lee Price current salary $212,326 $205,920 $198,474 $168,542 $145,000 $126,173 proposed salary $220,376 $223,127 $214,352 $183,711 $155,150 $137,529

Lee Price Gerald Silva Rick Doyle Del Borgsdorf Harry Mavrogenes Barbara Attard