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Posted on Tue, Mar. 23, 2004

Cash-Strapped Philadelphia Overspends on Overtime

By Jim Nolan, Philadelphia Daily News Knight Ridder/Tribune Business News

Mar. 23 - Overtime in the cash-strapped city of Philadelphia has gone overboard, jumping from $74 million to $134 million between fiscal year 1999 and 2003.

And a small group of city workers are lapping up the lion's share of the extra public payout.

Call them the Overtime Kings.

They are the 1,560 city employees who made more than 50 percent above their salaries in overtime last year, according to a Daily News analysis of fiscal 2003 payroll records generated by the city controller's office.

Consider:

--At about 6 percent of the city's work force, the Overtime Kings earned roughly one third of the O.T. paid out -- nearly $45 million in calendar year 2003.

--Among their ranks are 88 workers who earned more than 100 percent in overtime above their salaries.

--More than two-thirds of the Overtime Kings work in law enforcement -- as cops, prison guards, sheriff's deputies and Youth Detention Center counselors. But others rule in the Water Department, at Philadelphia International Airport, in the Streets and Health departments, the Recreation and Fire departments, and in Fairmount Park.

Among the hardworking royalty are:

--Lyle K. Canada, who made $40,317 in overtime on top of a regular salary of $35,870 as a labor crew chief in the Water Department.

--Mahlon J. Taylor, who made $52,313 in overtime on top of $34,325 as a custodian at the airport.

--Henry Mims, who made $43,615 in overtime on top of $37,313 as a lawn-cutter for the Recreation Department.

--Tanya M. Blackwell, who made $37,910 in overtime on top of $35,938 as an equipment dispatcher for the Fire Department.

At the very top is corrections officer John Sahou, who made $68,132 in extra pay last year, 179 percent of his regular salary of $38,078 working for the Philadelphia Prison System.

The Kings' rise to riches -- in many cases, a rise equal to or above the pay of top supervisors in their departments -- has been propelled by a dramatic increase in city overtime spending.

From fiscal year 1999 to fiscal year 2003, overtime paid out of the city's general fund to public employees skyrocketed 55 percent, according to the city Finance Department.

Overtime figures from the general fund do not include overtime spent on Water Department workers or workers at Philadelphia International Airport, which are funded differently.

The cost for fiscal year 2004, which ends June 30, is expected to be $117 million -- a reduction from the previous year, due in large part to cutbacks in Mayor Street's round-the-clock, anti-drug program, Operation Safe Streets, run by the Police Department.

Officials and experts on public spending cite a number of explanations for mounting overtime costs in recent years. Among them: an ongoing hiring freeze; a generous sick-time policy; mandated staffing requirements in law enforcement, and the city's obligations under union contracts.

But they also say that the concentration of high overtime payouts to individual employees raises questions of management oversight and productivity.

"It's an issue," the city's managing director, Philip R. Goldsmith, told the Daily News in an interview last week. "No question, some people ... know how to use the system."

David Thornburgh, executive director of the Pennsylvania Economy League, said the current system needs fixing.

"It strikes me that something is out of whack," he said.

"Either you are not deploying people correctly, there are too many gaps in the current system, or you don't have enough employees," Thornburgh said. "You've got contractual issues that are kind of handcuffing managers, or you've got cultural expectations that [paying overtime] is the way you're supposed to do things."

In his budget address last week, Street announced a series of cuts in services and raised the possibility of layoffs to quell the mounting fiscal crisis.

The city also has launched a review of overtime policy to help identify what costs are necessary and how much extra work it has gotten for its extra spending.

"It's simply impossible that the service provided in the first hour of a 90-hour week is the same caliber as the last hour," said City Controller Jonathan Saidel, who called for limits to be placed on the maximum amount of overtime hours city employees may work.

In the past, Goldsmith said, too many city supervisors had the power to authorize overtime, leading to a lack of accountability.

Now, department heads will have to submit biweekly and monthly reports on overtime, which will be monitored against previous years and current staffing levels.

In a March 8 memo to city department heads, Goldsmith wrote that it was critical that overtime be reduced in a "significant and responsible way."

"Overtime is not an entitlement," he wrote, "and it should not be viewed as a means to supplement salary or increase pensions."

Changing the system will be a difficult task.

The city is filling only 50 percent of the vacancies created by retiring workers and is down 800 jobs since September. There are now 23,877 city employees.

With the average city worker receiving benefits that amount to an additional 38 percent on top of salary, officials said in some cases it makes more sense to simply give overtime to existing workers rather than hiring more people.

Most overtime is paid at time and a half of a worker's hourly wage.

Each department has a supervisory level at which top managers are not paid overtime.

But certain departments, like police and prisons, have built-in, around-the-clock staffing requirements and emergency situations requiring officers to work extra hours at overtime pay.

Here is where most of the Overtime Kings are made.

The city's prison system paid 365 of its employees overtime that exceeded 50 percent of their salaries in 2003. Forty-five of those workers made more than 100 percent of their salaries in overtime.

"We have a fixed number of posts, places throughout the prison system, where we need people to man," said Leon King, prisons commissioner. "That's not to say we're satisfied with the way we have been doing things in general in the past."

The Police Department is the greatest single source of the city's overtime expenditures -- about $73 million of the $134 million paid out in fiscal 2003.

Nearly 600 cops made overtime that exceeded 50 percent of their salaries in 2003, according to payroll figures. The cost of these top earners came to nearly $21 million.

Former City Controller Joe Vignola said a major factor contributing to the department's overtime costs comes from court-related overtime the department pays out.

He cited a "lack of coordination and cooperation" among police, courts and the district attorney's office.

But sometimes, overtime is unavoidable, especially for cops. In fact, two of the top-10 gross earners in overtime were homicide detectives, according to payroll figures.

Detectives Leon Lubiejewski and William Egenlauf each earned about $60,000 in overtime in 2003, making them the highest-paid employees in the city among workers who qualify for overtime, at $120,687 and $118,757, respectively.

Vignola urged officials to "find a way to maximize taxpayer value" when it comes to overtime.

Street administration officials are already discussing one way to cut excessive overtime in a city that can't afford to hire more employees: reducing the sick-leave benefit and replacing it with a new disability-insurance program.

Under the current plan, city workers take off an average of 12 to 13 sick days per city employee year, "more than double the average in the private sector," notes Street's plan. "This has resulted in high overtime costs and service disruptions to cover the unplanned absenteeism."

The overtime buck is even stopping at the mayor's office.

A couple of weeks ago, Goldsmith said the Public Property Department told Street that it would come in over the weekend to do some work in his office. The mayor told them to come during the week instead.

He's work elsewhere -- and save the O.T.

"Everyone's getting sensitized," Goldsmith said.

Staff writer Mark McDonald contributed to this report.