Are city workers overpaid? List of top salaries might surprise you

Kristin Czubkowski  —  8/28/2008 6:15 am

As the City Council prepares to dive into budget talks this year, one item in particular will, as always, stand out as the costliest in the entire budget: employees' salaries.

Up to 80 percent of some departments' budgets are spent on salaries. Overall, the city's 2,700 full-time salaries cost the city more than $144 million in 2007, or 68 percent of its 210.8 million operating budget. (See a list of 2007 city of Madison staff salaries here.)

"You look at the things the city does, and we're not operating a factory and producing goods and selling goods," city Comptroller Dean Brasser said. "It's the people out on the street doing field services."

Mayor Dave Cieslewicz is already calling the upcoming budget the toughest he's had to deal with, but employee salary levels likely won't come up as a way to cut costs when the City Council gets down to business this fall. Why is that?

Hard-to-change union contracts would be one short answer, but beyond that, city officials say Madison salaries are competitive in the city government market and that changing them could reflect badly on the city. The list of the top 227 city salaries in 2007 included with this story (a list of the top 700 is on captimes.com) may raise some eyebrows, but experts outside the city say many comparable private sector jobs would pay much more, particularly at the top levels of administration.

Take Brasser, the city's top paid employee, as an example. He is a UW-Madison graduate with a bachelor's degree in accounting and real estate and a master's degree in public administration. He has worked for the city of Madison in various accounting positions since 1976, becoming the top accountant, or comptroller, in 2000.

As comptroller, a position that is equivalent to a company's chief financial officer, Brasser makes almost $138,000 without benefits, and $173,000 with benefits. According to the web site CFO.com, however, Brasser could be making up to $300,000 or more in the private sector of Madison as a chief financial officer, with a median salary of $290,670.

This type of disparity between the public and private sector is common, said Joel Rogers, director of the Center on Wisconsin Strategy, because unlike in a company, governments are constrained by the taxpayers' ability to pay. As the city of Madison gets less money each year from the state government, and as the economy and development slows in the city, the tax levy becomes a main source for revenue, but one that is limited by how much city residents can reasonably be expected to pay.

As a result, Rogers said, city employees, even at the top levels, do not make excessive salaries.

"In general, public employment is going to pay you less than private sector employment for the same level of skill. And then in general, public employment is going to give you better benefits and more security than the private sector."

Dale Knapp of the Wisconsin Taxpayers Alliance agreed that benefits packages, which at the city level include health insurance with low co-pays and retirement packages, among others, can lead to some tension between public and private sector employees as private sector workers see their health insurance becoming more costly.

Overall, though, he said complaints about city government spending money on salaries are "not as rampant as people often think."

People "don't like big increases in their property taxes -- that's clearly one thing. But if they can see what their taxes are going toward and that they're getting a return on their money, on their dollars in terms of public infrastructure or education or whatever, they're not dissatisfied with that."

Madison's salaries for common city positions such as fire chief, police chief and chief librarian are all comparable to those for U.S. cities between 100,000 and 250,000 in size, according to statistics from the International City-County Management Association.

For those salaries that don't compare, there's usually a clear reason. For instance, Madison City Engineer Larry Nelson, with a salary of about $137,000, makes nearly $40,000 more than the average city engineer, according to the association's statistics. But he also serves as Madison's director of public works, a position that averages close to $120,000 alone, according to the association.

WHILE department heads like Brasser and Nelson negotiate their salaries with the mayor every five years, for many lower-level employees the process can be much more intricate. That's because more than 80 percent of city employees are part of one of about 10 different unions or two similar associations, Brasser said, from the Teamsters Local 695 union that represents Madison Metro employees to the Professional Librarian Unit to the Madison Professional Police Officer Association.

For union employees, the basic salary structure of union contracts has been in place for many years, but contracts are renegotiated every two years, generally resulting in a raise of between 2 and 4 percent depending on what other benefits are being negotiated. Besides having standard pay increases for the first five years of work, the contracts are backloaded to include significant raises for longevity -- up to 12 percent after 25 years -- which accounts for a significant number of people on the city's top-paid list.

Similarly, retirement or leaving a city position is one factor that can bring someone up on the list, Brasser said, noting the high position of former Water Utility manager David Denig-Chakroff, who was paid a settlement for his resignation in September 2007.

Overall, 35 of the top 700 employees are no longer with the city, including high-ranking employees such as former human resources Director Roger Goodwin, former parks Superintendent James Morgan and former Division Fire Chief Marcia Holtz, all of whom earned more than $100,000 last year.

To put the top-paid list into further context, human resources Director Brad Wirtz said the city employs a total of 2,700 full-time workers and 4,000 workers total, and only 25 percent of the full-time salaries are over $67,000. That means that hundreds of employees don't make the top 700 list, with police officers and firefighters, for example, earning about $41,000 in their first year.

In the past, according to Madison Professional Police Officer Association President Dan Frei, Madison police were considered highly paid, but that is less the case now as suburban areas of Madison and Milwaukee are starting to pay beginning police officers salaries in the upper $40,000s.

"Madison police are no longer in the highest three or four departments in the state," Frei said. "Early on, Madison was one of those departments everyone else pointed to and said, 'Well, look what they're making. We should be making similar money,' and now there's a fair number of departments in the state that are making significantly more than we are in terms of base salary and some of their incentives."

Frei said Madison police recruiting has "definitely been impacted" by these shifts in salary rankings, but one way that Madison has been able to retain most of its recruiting numbers has been through educational incentives that kick in after about four years of service. As a result, Madison police have one of the most highly educated police departments, with the "vast majority" having at least a bachelor's degree.

Despite what may be a slightly decreased salary ranking for police, Wirtz said the city does "a lot of comparing our union employees to other cities with unions with comparable positions, and we're very comparable.

"We're competitive, but we're certainly not out of the range of other unionized city employees," he said.

In particular, Madison tends to look at the five biggest cities in Wisconsin for their comparisons, although at less than half the size of Milwaukee and twice the size of the next largest city, Green Bay, comparisons can sometimes be difficult.

ANOTHER perennial factor in city salaries are significant overtime costs, which are common for police, fire and Madison Metro employees, some of whom make the salary list even though they aren't managers.

In past years, Madison Metro in particular has been criticized for the number of drivers making more than $70,000 or even $100,000 largely due to overtime costs, but current Metro Manager Chuck Kamp said the department has been continually working to cut those costs by reducing absenteeism and worker's compensation, the latter of which has been cut by more than 20 percent over the past two years.

The results are clear. In 1999, five bus drivers were among the top 25 highest-paid employees for the city; none currently are, with the closest coming in at No. 28.

High overtime costs will likely never be completely eliminated, though, Kamp said, because of the Metro drivers' contract with the city that prioritizes overtime by experience level, giving veteran drivers first dibs on overtime assignments. The two top paid Metro employees, who each earned more than $100,000 with overtime, worked on average 60 to 65 hours per week in 2007, he said, and had 60 years of safe driving between the two of them.

"It is cost-effective, especially in the short run, rather than hiring additional drivers quickly, which is not efficient, to use overtime where we need to," he said. "I think we're striking an improved balance with each passing year."

Frei said that while police officers and firefighters also tend to earn significant overtime, another big part of their earnings include pay for working security for special events, which actually brings money into the city.

"Say your organization is having an event and you want officers there either to help with crowd control or for traffic direction," he said. "The city bills you a rate and they take a small percentage of that and then the officer gets a percentage of what the city is billing, so the city is actually bringing in income, and part of that income they're giving back to you, the officer."

For some departments, however, overtime is a result of staff levels kept low because of budget compromises. For example, one person on the list of top overtime-earners who may come as a surprise is librarian Janet Anderson at No. 18.

Anderson is a cataloger for the library, or someone who enters books in the library's database to give people immediate access to them. Library Director Barb Dimick said Anderson has been working extensive overtime over the past year-and-a-half or more because of an open cataloging position in the library system. Dimick has not been able to fill the position because of budget constraints in recent years, she said.

THE relative inflexibility of city salaries means that when budget negotiations roll around each year, it's not necessarily how much city employees cost, but how many are hired that guides the discussion. For example, when the City Council debated the 2008 city budget until 5:30 a.m. last November, one item -- the addition of 30 police officers at a cost of $1.5 million -- garnered the most discussion.

During more difficult budgets, hiring tends to shrink. In 2003, a difficult budget prompted Cieslewicz to implement a hiring freeze. As the city faces increased fuel and health insurance costs and decreased revenues from a slumping economy and slowed development, this year's budget is poised to be even more difficult for city agencies, with Cieslewicz calling the budget the worst he has seen in office.

Mayoral spokeswoman Rachel Strauch-Nelson said the mayor has not implemented a hiring freeze for the 2009 budget, but he has told agencies that there will be no new spending. He has also requested budgets with 5 percent contingency cuts from every department, making new hiring a near impossibility. Cieslewicz has said, however, that he will not cut any police officer or firefighter positions.

As he told members of the public at a budget hearing on Aug. 18, Cieslewicz's message to city departments has been: "This is not the year for new programs or expansions or new personnel. It's not going to happen. Don't even think about it."

Moreover, with salary levels set, and personnel making up the majority of most departments' budgets, the 5 percent contingency cuts could likely come from staffing levels.

Lori Kief, a member of the American Federation for State, County and Municipal Employees Local 60 union and a member of the city's Building Inspections department, said budget cuts in the past have often come at the expense of ground-level workers. In particular, she said, departments like Parks now often rely on seasonal workers with low health-insurance costs, leaving those departments understaffed in the winter.

"Managers aren't going to look at manager positions" for budget cuts, she said, adding that the cost of one manager position often equals two lower-level employees who are cut.

"These are the people that mow the lawns in the parks and inspect the buildings and trim the trees and man your concession stands in the winter at the skating rinks," she told Cieslewicz at the Aug. 18 budget meeting. "I'm hoping we can look to other places should we have to talk about not filling positions and eliminate positions."

The relative inflexibility of salary levels, however, often necessitates cuts in staff at many levels, Brasser said.

"Because of all the labor laws and everything that we all operate under, the council can't say, 'Let's pay police officers 10 percent less next year to save money.' They can, however, say 'Let's have 10 percent fewer officers,' " he said.

Kristin Czubkowski  —  8/28/2008 6:15 am