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City workers ink contracts that will end Manteca structured deficits

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POSTED January 2, 2012 1:53 a.m.

The biggest accomplishment in 2011 when it comes to Manteca’s municipal government wasn’t to either start or complete $20.1 million worth of infrastructure investment.

It was actually not spending money.

Contract agreements put in place with city employee bargaining groups instituted a series of moves that included forsaking salary increases, continuing non-paid furlough days, and workers paying more for health benefits and retirement. All of that means Manteca’s structured deficit may soon be a thing of the past.

“The city workers really stepped up,” said Manteca Mayor Willie Weatherford. “Manteca will no longer be spending money before it gets it.”

Weatherford is referring to decisions made more than a decade ago that put in place employee compensation increases that had included pre-negotiated escalators for pay and benefits. It was back in the heady days of the housing market when revenues kept going up - primarily property and sales taxes - prompting cities up and down the state including Manteca to go out on the limb on the assumption revenues would keep escalating.

There were warnings that it wasn’t a good thing to do. Former City Manager Robert Adams noted in two different annual budget messages to the council that the structrured deficit needed to be addressed. But with revenue increases each year citizens were pressing council members for more services and city workers were pushing for compensation to match similar cities.

It was a scenario that played out in other cities as well. As a result, rising public employee compensation - just like that in the private sector - forced employers to increase pay to match competitors or else risk losing long-term, experienced employees.

By the time the dust had settled in 2011, a typical city employee has given up right around 20 percent of their annual compensation accumulatively over the past three years to essentially wipeout projected deficits.

“Manteca from here on out should only be spending money it has in (hand) for (day-to-day) services,” the mayor said.

Weatherford noted that city workers - just like many of their counterparts in the private sector - are doing more work with less compensation and reduced staffing.

The mayor added that he doesn’t expect things will ever return to “normal” in terms of how city government was funded before the housing meltdown started.

The bottom line is Manteca in 2012 for the first time in more than a decade is on a course where day-to-day municipal operations will not exceed revenues in any given year.

It is the end result of salary negotiations that have been painful for workers but in the end - if projections for sales and property taxes hold - will avoid further cuts in city jobs and municipal services.

Salaries and benefits account for about 80 percent of the general fund.

The goal of salary negotiations were to eliminate a $4.2 million deficit that existed on July 1, 2011 for the current fiscal year as well as future anticipated or structured deficits for the next three fiscal years.

The four-year contract signed in 2011 by the Manteca Police Officers Association, as an example, reflects savings of more than $4 million.

The police - just like other employee groups - will benefit if municipal revenues exceed projections in any of the next four years. When that happens, a certain percentage of each dollar is being set aside for employee compensation. Then each bargaining unit can decided whether they want whatever additional money is available to go to salary, benefits, or retirement.

In past years, the city has dipped into reserves and spent down discretionary funds such as the fees known as “bonus bucks” collected on new housing growth in exchange for sewer allocation certainty.

The first part of the last decade the city squirreled it away excessive revenues and essentially spent the last five years using it to prop up general fund services such as police, fire, public works, and parks.

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