Posted on 03/23/2004 2:42:17 PM PST by Joe Hadenuf
(I instructed the Admin Moderator to remove the other thread).
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Public payroll soars
Salaries move far ahead of inflation
From the city of Los Angeles to California state government, the cost of salaries and benefits for public employees has soared far faster than inflation in the last five years -- three times as fast in the case of the Los Angeles Unified School District, a Daily News analysis has found.
The study showed that spending for public employees' salaries and benefits at the state and local levels increased overall at more than twice the rate of inflation and grew faster than the per capita income of average Californians. The cost of pensions was excluded from the analysis because of the wide disparity between different levels of government.
The spending binge started at a time that tax revenues were soaring, at the peak of the 1990s dot-com boom. Now that the boom has gone bust and the economy remains weak, state and local officials are making deep cuts in public services and looking for ways to raise fees and taxes. The review covered the fiscal years from 1997-98 to 2002-03.
"At all levels of government, the rate of compensation has gone up much more rapidly than it has in the private sector and, most importantly, faster than the personal income of the people who pay for this," said Steven B. Frates, a senior fellow at the Rose Institute of State and Local Government at Claremont McKenna College.
"There has been a wealth transfer. It has gone from the citizens to the people in government".
"You often hear people in government cry that there are going to be cuts and we're hurting the poor and the little children. The fact of the matter is the citizens of the state, county and city are making life better, not necessarily for schoolchildren or people in need, but for government employees."
The review covered the state of California; the city of Los Angeles; Los Angeles County and three neighboring counties; the LAUSD; and the Metropolitan Transportation Authority. Overall salary and benefit expenditures increased between 18 percent at the MTA and 53 percent for San Bernardino County during the five-year period.
The portion for employee benefits alone jumped by 35 to 186 percent.
In comparison, the inflation rate in California rose 17 percent, and per capita income in the state increased 24 percent.
Pension costs varied widely and dropped at some public agencies like Los Angeles city government, which has its own pension fund that profited from the booming stock market, and skyrocketed by as much as 79 percent at other agencies. Many local governments now face huge pension bills largely because of expansion in pension benefits.
Workers' compensation costs rose between 29 and 141 percent, and overtime costs increased by 13 to 60 percent.
In the last five years, per capita income in California increased 24 percent, from $26,521 to $32,898. Nationally, employees in the private sector earn an average of $34,299 a year, plus $13,374 in benefits.
That compares to the $49,005 annual salaries local and state government employees enjoy, plus $21,528 in benefits, according to U.S. Department of Labor statistics.
The highest average salary and benefits package is in Los Angeles County, where compensation jumped from $59,126 to $79,057, although officials point out that many employees went without raises for several years in the mid-1990s.
Local and state government officials said they approved compensation increases for their employees to remain competitive with other government agencies and the private sector, and that some cost increases, such as health care and workers' compensation, were outside of their control.
Some union leaders questioned the figures.
"We represent over 50,000 county employees whose salaries increased 24 percent over 10 years, an average increase of 2.4 percent a year," said Bart Diener, assistant general manager of Service Employees International Union, Local 660, which represents Los Angeles County workers. "We believe this is appropriate and in line with the growth in the economy."
But H.D. Palmer, spokesman for the state Department of Finance under Gov. Arnold Schwarzenegger, said the 41 percent rise in state salary and benefits costs under former Gov. Gray Davis clearly exceeds similar increases in the private sector.
"Looking at that growth in the rearview mirror, it's clear that kind of growth is unsustainable over the long haul," Palmer said. "It's one of the reasons the governor has said he'd like to reopen a number of contracts with state employee unions."
With the state facing a massive shortfall even after voters approved a $15 billion bond issue mainly to refinance existing debt, state and local government agencies now face making steep cuts. Much of the problem was caused by a five-year state spending spree that raised expenditures 43 percent while revenue rose only 25 percent.
Los Angeles County faces making nearly $500 million in cuts, while the city of Los Angeles faces $250 million and the LAUSD $600 million.
County Supervisor Michael D. Antonovich said the biggest portion of the salary increases comes from often unnoticed 2.75 percent and 5.5 percent annual "step" increases, or merit raises, which local and state government workers get during their first five to 11 years of employment.
"And many times employees who reach the fifth step after five years will be reclassified for another five years," Antonovich said. "This is above any cost-of-living adjustments negotiated in labor contracts. That's why those numbers go up so much each year and services are cut.
"So what they need to have is a two-tiered system. Labor laws need to be modified. You could develop a new classification that would allow step increases based upon merit and performance with a smaller increase. So what you would have is something similar to the private sector where promotions are based on merit and performance, not just showing up and having your eyes open."
Jon Coupal, president of the Howard Jarvis Taxpayers Association, said the figures confirm that the only "growth industry" in California is government.
"It's clear that the size of government and the slice it takes from the private sector continues to expand," Coupal said. "And while private sector businesses have suffered, it appears that local and state government believe they are beyond economic pressures."
Coupal said local and state officials should renegotiate contracts with employees unions, consider salary and benefit cuts, work furloughs and layoffs to reduce spending.
But Robert Stern, president of the Center for Governmental Studies, said government employee unions are powerful in California and he's not aware of any agencies cutting salaries and benefits since the Great Depression.
"These are pretty stout increases in both salaries and benefits," said Jack Kyser, chief economist at the Los Angeles County Economic Development Corp. "But the attitude in Sacramento was, 'Look at all this money coming in,' and they spent us into a massive budget deficit."
And, with the state plagued by a structural deficit of up to $10 billion a year, Kyser added: "We are either going to have to increase taxes or make painful cuts in spending. We are not out of the woods yet."
Frates of the Rose Institute said elected leaders bear the blame.
"They gave the farm away," Frates said. "California politicians need to be candid and open about what they are actually spending taxpayer money on.
"They frequently use the shorthand of, 'It's for public safety, education and public health,' when in fact it's for lavish salary and benefit increases for public employees at the expense of the general citizens of California. There are many public safety employees who now make more in retirement than they did when they were working and they get to retire at age 50."
Schwarzenegger is trying to renegotiate contracts. Los Angeles city officials have talked about renegotiations as well and County Chief Administrative Officer David Janssen has proposed a 1 percent salary cut for county employees and furloughs to save about $20 million.
"The question is do we make these necessary adjustments, or do we fire people?" Antonovich asked. "I'd rather make reductions and keep people employed. I believe you will find from workers a willingness to move forward and take reductions to retain their jobs and continue providing services to the public.
"The union leaders have traditionally opposed these reductions and would rather lay off people than have any reductions in compensation. To me, that is cruel and unnecessary. They don't want to jeopardize the benefits they have already gotten." l=8s=8 Troy Anderson, (213) 974-8985 troy.anderson@dailynews.com AT A GLANCE Here are highlights of the changes over the last five years based on figures from state and local governments, comparing fiscal year 1997-98 to fiscal year 2002-03. State:
Spending for salaries and benefits, excluding pensions, was up 41 percent, from $13.3 billion to $18.7 billion.
The number of full-time employees increased 10.5 percent, from 192,377 to 212,563.
The salary for correctional officers increased 25.4 percent, from $65,450 to $82,066 a year. City of Los Angeles (Not counting the departments of water and power, airports and harbor):
Spending for salaries and benefits, excluding pensions, rose 26 percent, from $1.8 billion to $2.2 billion.
The average salary of civilian workers rose 23 percent, from $45,534 to $55,919, while the average for police officers grew 28 percent, from $60,397 to $77,537.
Overtime costs increased by 61 percent, and workers' compensation costs went up 81 percent. Los Angeles schools:
In the Los Angeles Unified School District, expenditures for salaries and benefits rose 51 percent, from $3.6 billion to $5.4 billion.
The average salary and benefits package of an LAUSD employee grew by 27 percent, from $51,424 to $65,526.
The number of full-time employees expanded 18 percent, from 69,140 to 81,691. Los Angeles County:
Expenditures for salaries and benefits rose 39 percent, from $5.0 billion to $6.9 billion.
The average county employee's salary increased 31 percent, from $37,664 to $49,343.
Workers' compensation costs soared 96 percent, from $143.1 million to $281.0 million. Ventura County:
Salaries and benefits rose 22 percent, from $271.5 million to $330.9 million.
Overtime shot up 55 percent, from $1.9 million to $2.9 million.
Workers' compensation costs skyrocketed 141 percent, from $4.5 million to $10.7 million. MTA:
Salaries and benefits increased 18 percent, from $499 million to $589 million.
The number of full-time employees was up by 17.9 percent, from 7,576 to 8,930.
Remember when government workers and politicians were considered public, civil servants?
Now it's the job of choice due to the big money and generous benefits, all on the backs of the little peon, taxpayers.
Government is only growing larger.
They just built a new city hall not too far from me. It's the fanciest, most opulent building in the entire area.
The parking lot is full of near new cars, they have beautiful landscaped, secured, and guarded parking.
There are lavish fountains, landscaping, safe, secure bullet proof windows for their employees, guards, closed circuit cameras to watch for angry tax payers, and to top it off, they built one of the most expensive restaurants in the area right across the street, so the government employees don't have to travel far to those yummy, tax payer paid lunches.
On August 24, 1991, they didn't show up, rather they headed for the USSR border. They apparently didn't want to stay around for the celebration of the end of communist rule.
It couldn't happen here of course....
What was wrong with it?
An interim measure I'm looking at is moving to New Hampshire to join the Free State Project, then moving offshore when we can. Realistically, I think that project will only temporarily halt the phenomena in very localized region, though I would really like to be proven wrong because I love this nation. We have concluded that this voter-fed insanity will not stop until it is forced to stop through external circumstances. I'm concerned it will take a calamitous economic disaster to shock this nation's citizens back into demanding prudent governance by themselves rather than of themselves.
My business partner's and my general idea is to do what we can to starve out this growth, while working from within to do what we can (up to a point --- after that point, we are physically getting out of Dodge) to reverse it. No use fighting something if you let it sap your own strength against you at the same time, we figure.
I agree.
I've often wondered why many government buildings and government offices seem to be turning into quite beautiful, armed, and guarded fortresses, with top shelf security.
Nobody's buying my lunch. Am I working for the wrong agency? (/irriation off)
Ever notice that the people that fill these positions, many times treat the lowly tax payers with utter contempt, and have attitudes of royal arrogance? It's glaring.
Nobody's buying my lunch. Am I working for the wrong agency? (/irriation off)
From that, I take it your a government employee.
What I meant was these government employee's that are crowding this very expensive restaurant across from the beautiful new city hall facility, are buy their expensive lunches with their compensation from the tax payers. Are the tax payers in your area not paying for the government employee's wages, salaries and benefits?
Did you not read this article? Do you see nothing wrong here?
Can you imagine, 70,000 government employee's in one city? Unbelievable!
That's a problem too. So the government is contracting with these former "civil servants" that are now collecting big time government pensions?
Case and point,here in Cleveland the airport expansion has paid close to 16 million in legal fees to a firm that the ex-mayor(who hired said firm) now work for....hmmmm.
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