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HomeMy WebLinkAbout120913 CCC Minutes_approved_1m(BD)(tt)COUNTY OF KAUAI Minutes of Meeting OPEN SESSION Board /Committee: I COST CONTROL COMMISSION Meeting Date December 9, 2013 Location Mo'ikeha Building — Liquor Conference Room Start of Meeting: 1:30 p.m. End of Meeting: 2:55 p.m. Present Chair Sandi Sterker; Vice Chair Arryl Kaneshiro; Members: Dirk Apao, Lawrence Chaffin Jr., Joanne Nakashima, Laurie Yoshida Also present: First Deputy County Attorney Amy Esaki; Boards & Commissions Office Staff. Support Clerk Mercedes Youn; Administrator Paula Morikami; Administrative Aide Teresa Tamura; Councilmember JoAnn Yukimura; Deputy Chief of Police Michael Contrades; Sergeant Jesse Guirao; Director of Finance Steven Hunt; Purchasing and Budget Director Ernest Barreira Excused Commissioner Glen Takenouchi Absent SUBJECT DISCUSSION ACTION Call To Order Chair Sterker called the meeting to order at 1:30 p.m. with six (6) Commissioners present to ascertain a quorum. Approval of Regular Open Session Minutes of November 14, 2013 Commissioner Chaffin moved to approve the Minutes minutes as circulated. Commissioner Apao seconded the motion. Motion carried 6:0 CCC 2013 -25 Selection of 2014 Chair and Vice Chair Chair Sterker moved to elect Vice Chair Kaneshiro to the position as Chair for 2014. Commissioner Chaffin seconded the motion. Motion carried 6:0 Chair Sterker moved to elect Commissioner Yoshida to the position as Vice Chair for 2014. Commissioner Chaffin seconded the motion. Motion carried 6:0 CCC 2013 -26 Approval of 2014 Cost Control Commission Meeting Schedule Vice Chair Kaneshiro pointed out that the December 12th meeting falls on a Friday. taff noted that it was a typo and that the correct meeting date Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 2 SUBJECT DISCUSSION ACTION should be on Monday, December 8 t Chair Sterker called for the approval of the 2014 Cost Control Commission Commissioner Chaffin moved to approve item Meeting Schedule, as amended. CCC 2013 -26, as amended. Commissioner Yoshida seconded the motion. Motion carried 6:0 CCC 2013 -27 Memorandum dated November 1, 2013 from Councilmember JoAnn A. Yukimura to Chair Sterker and Members of the Cost Control Commission, regarding a request for agenda time to discuss the financial impact of Unit 12, State of Hawaii Organization of Police Officers ( SHOPO) collective bargaining agreement Chair Sterker called for a motion to receive item CCC 2013 -27. Commissioner Chaffin moved to receive item CCC 2013 -27 for the record. Commissioner Yoshida seconded the motion. Councilmember Yukimura began by thanking the Commissioners for Motion carried 6:0 giving her the opportunity to share her concerns regarding the financial impact of the SHOPO collective bargaining agreement. She stated that the SHOPO raises would have a huge impact on the County's current budget and future budgets. She stated that she sent a letter to Council Chair Furfaro (dated September 9, 2013) articulating her concerns about the far reaching negative impacts that the raises would likely have on the County's budget, operations, and residents including the police force in the long run. She explained that her purpose here today is not to seek a reversal of the results, but to discuss the system by which compensation decisions are made because she felt that the current system is not working, and perhaps make things clear or generate questions that she and the Commission could dialogue on. Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 3 SUBJECT DISCUSSION ACTION Councilmember Yukimura made it clear that she is not opposed to the raises because she felt it is well deserved and vital to the well being of the County, and that she admires and respects and appreciates the police and what they do. She shared with the Commission that on the day the Committee voted on the raises she was told that the Employers first position was to propose cuts, which to her did not seem justified because she was in favor of the raises but only questioned the amount. She stated that during the meeting questions were raised about the Department of Finance's analysis based on the arbitration award in which the average pay for a beginning police officer four years from now would start at $65,000 for a total cost to the County, including benefits, of $114,000. For a position of a police captain four years from now, the average pay will start at $117,000, including benefits, for a total cost to the County of $192,000 plus, which exceeds more than the Mayor of the County would be making. She continued to express her concerns about the importance of finding balance during the decision - making process, and setting precedence for other workers in the County that the budget cannot meet. She stated that the SHOPO raises would probably set a standard for the fire fighter pay increase, and would invoke other collective bargaining units as well. She pointed out that the County life guards also risk their lives for public safety, and although the HGEA and UPW employees may work at a lesser risk, their work is no less critical to the essential services that the County provides to the community. She stated that during the arbitration proceedings a concern was brought up about the ever widening disparity inequity between uniform officers and non - uniform county employees, which according to the Employers' brief Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 4 SUBJECT DISCUSSION ACTION the police and fire employees are the highest paid workers in the County and that they continue to receive raises while the other bargaining units suffered furloughs and/or wage salary reductions of up to 9.23 %. She made a comparison that the average cost for uniformed officers amounts to $99,804 while the average cost for a non - uniformed employee is $58,148, which includes attorneys, information technology specialists, and professional engineers, including life guards who are arguably public safety uniformed officers as well. Councilmember Yukimura stated that she believes that SHOPO did not fully understand the implications of the arbitrator's award, and that they failed to take into account the compounding of both wage and step increases and underestimating the cost of the impact of their proposal by $55,343,347 statewide. She emphasized that the County Council is faced with a difficult dilemma in which it has to find ways to achieve fairness and constructive results among all of the different type of workers who may not be directly involved in public safety, but are still essential and important to the work of the County. Chair Sterker asked if there was anything that can be done at this point or is the decision cut and dry. Councilmember Yukimura stated that nothing can be done at this point about the existing pay raises, and that her purpose today was to not ask the Commission to reverse the results, but to talk about future decisions which is of concern. Chair Sterker mentioned that the Commission was concerned about the amount of overtime being paid out, and supported the idea to increase the salaries for the police officers in order to attract more applicants which would help to reduce the overtime in the Police Department. Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 5 SUBJECT DISCUSSION ACTION Councilmember Yukimura shared with the Commission that the County Council had a robust discussion about the overtime, which resulted in the approval of a grant for an additional beat in the Kawaihau district. She mentioned that it was explained to the County Council that by adding a new beat the overtime is expected to be reduced to a certain extent, but not completely, and that it does not address the issue about pay and compensation. Commissioner Chaffin commented that although he finds the information informative he wonders how the compensation for a police officer compares to a sheriff. He asked whether it was possible to provide the Commission with a detailed chart showing each department's level of compensation, comparison of each compensation level, and a comparison between a police officer and another department employee. Councilmember Yukimura replied that his question should be directed to the Human Resources Department because it depends on the job description and its qualifications. Vice Chair Kaneshiro asked whether the Standard of Conduct differential is due to the risk of the job. Deputy Chief of Police Contrades explained that the Standard of Conduct differential is a pay that police officers receive because they are held to a higher standard. He further explained that unlike other County employees if a police officer is arrested or is given a disciplinary action while on or off -duty it is more than likely the officer would be dismissed from duty. He stated that it is his understanding that through the collective bargaining, the Standard of Conduct pay was added to a police officers pay. Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 6 SUBJECT DISCUSSION ACTION Commissioner Chaffin asked if the Standard of Conduct pay is similar to the fire fighters to which Deputy Chief Contrades replied that the fire fighters do not have the Standard of Conduct pay. He noted that a fire fighter who gets into trouble while off -duty still has the possibility of keeping their jobs. Deputy Chief Contrades stated that he could end the overtime, but the services to the community would diminish tremendously, and in certain situations the issue about the overtime cannot be controlled especially if it involves a major natural disaster or an officer involved shooting because of the need for a follow -up investigation. In terms of the GMO hearings, Deputy Chief Contrades explained that when the hearings began the Police Department went out in full force with no issues, but when asked to pull back because of the issue with overtime it resulted in complaints of lack of officers present. He added that after seeing the public's reaction to the Mayor's vetoing of Bill 2491 the Police Department felt that it was important to have the officers present during the County Council hearings just in case something happens. Chair Sterker commented that the Police Department might want to consider putting a plea out to the various service clubs and community organizations for them to take charge of what is taking place in their community. Chair Sterker recalled that in the past, the Commission had a discussion on whether the various tax exemptions should be maintained, revised or eliminated because the Commission felt that it would have given the police and fire department additional money to help with its daily operations. Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 7 SUBJECT DISCUSSION ACTION Councilmember Yukimura mentioned that through Councilmember Bynum's leadership the County Council increased the real property tax rates on all but owner occupant properties, and that raising ten million dollars is only the beginning of the budget process. She added that raising taxes would be difficult to project at this point because the County Council still needs to hear from the other departments and requests. Chair Sterker indicated that her point was not to raise taxes, but to eliminate real property tax exemptions for certain non - profit organizations because these organizations use the services of both the fire and police department. Vice Chair Kaneshiro said given the fact that the collective bargaining process is out of the hands of the Commission what else could be done that is within the Commission's purview. Councilmember Yukimura stated the Commission could make a recommendation through the Mayor to the extent of how to address the issue of what is the most important asset and how do you treat that asset fairly. Police Officer Sergeant Jesse Guirao, SHOPO's Kauai Chapter Chairman, shared through his experience as a police officer what it's like to be on the road and on the front line. He mentioned that since 1989 only two beat officers was assigned to cover the entire Li -hu`e district, which starts from Rice Street to the Knudsen Gap going west and the Wailua Bridge to the north. He commented that although he understands the need to reduce overtime, a police officer's job is never done until every police report is completed. Chair Sterker asked if the Kauai Police Department is equipped with its own dictation system to which Sergeant Guirao replied no, and that it is his understanding that the Big Island Police Department has a dictation system in their department. Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 8 SUBJECT DISCUSSION ACTION Deputy Chief Contrades stated that he had an opportunity to fly to the Big Island to see their dictation system, at a cost to the County of three million dollars. He explained that after speaking in detail about the system he found that the system is not as easy as one would expect where an officer could just call in and have their dictations taken care off. He stated that although their department has a large staff to do the dictations the reports still needs to be reviewed for accuracy before it can be released. Commissioner Chaffin commented that he thinks the Commission should recommend that the County supply the Kauai Police Department with its own dictation system to solve the overtime problem. Chair Sterker welcomed Director of Finance Steve Hunt to the meeting. Director of Finance Steve Hunt stated that it is evident that the collective bargaining process is multi jurisdictional, and that although the County has a say it does not have the final say. He mentioned that the County could have objected to SHOPO's offer, but it would only put it back into the collective bargaining, which would probably be settled the same way it initially came out. He explained that in the beginning of the negotiations the County has the most control because that's when both parties are speaking about the terms, but if both sides cannot agree on the terms then it goes into binding arbitration. He stated that often the County gets dealt something that it cannot afford, but that's just the nature of binding arbitration and you have to find a way to do it. He noted that ultimately there could be consequences if the County cannot raise enough revenue, and although the binding arbitrations would affect the individuals it could ultimately have an adverse effect on the overall staffing, meaning they could get their raises but have fewer people to spread the raises amongst, and by doing that the County would fall back into the overtime circle again. Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 9 SUBJECT DISCUSSION ACTION Commissioner Apao asked when does the arbitration start and when does it get to the point where decisions like the recent SHOPO agreement are made. Mr. Hunt stated that the SHOPO negotiations began in November 2012 when the County had at its disposal the FY 2011 Coffer. He noted that because the 2013 Coffer was not available until December it caused an additional change in the fund balance because information on the available funds from the unassigned fund balance was not available at the time when the arbitration hearing began. He stated that technically the SHOPO agreement is really a six (6) year agreement although only four years of it is retroactive to July 1St of 2013 as the start date for retro payments. Usually when it gets to the end of the agreed upon term, the negotiations would begin again. Chair Sterker asked if the negotiations for the fire fighters have begun. Mr. Hunt stated that the process is still on- going, and no across the board salaries have been ratified. He noted that a fire fighter does not have the Standard of Conduct pay and in some respect, their agreement would be a little less than a police officer. Chair Sterker asked how many different bargaining units are coming up for negotiation next year. Mr. Hunt stated that Bargaining Units 2, 3 and 4 are two year agreements and that the negotiations would take place in a little over a year for an extension. Chair Sterker asked what happens when you get to the point where everyone wants something and the County just can't do it. Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 10 SUBJECT DISCUSSION ACTION Mr. Hunt stated that the focus would be mainly on the inversions because the rank and file would make more than the police and fire chiefs and their deputies including the Mayor; although they would have some control over the salaries through the Salary Commission whose responsibility is to establish the salaries of certain department heads and their deputies. Budget and Purchasing Director Ernest Barreira shared with the Commission that in 1995 -96 the collective bargaining agreements resulted in a reduction in force that only involved the State and not the County because back then the County was financially sound. He stated that even if the County had to exercise a reduction in force because of the collective bargaining he wanted to make clear that the County is not headed in that direction. He stated that the Mayor has made it very clear in all of his statements from day one that a reduction in force or any type of position eliminations are not on the table at this point, and that they would continue to explore every conceivable possibility to avoid that eventuality. But the reality in the reduction of force is that at the end of that process, because of the bumping rights, the amount of money that is saved is insufficient meaning that the amount in reductions that are needed are so severe that it would substantively impact the County's ability to deliver its services and meet its mission to the people. Mr. Barriera mentioned that last year, he came to a meeting to inform the Commission about an eight million dollar reduction in the County's operation expenses to help with the alignment, which should have put the County in good shape this year. But as Councilmember Yukimura had mentioned, her concerns about what numbers were being looked at while going through the collective bargaining exercise was not about who deserves what because it was important for the County to be financially responsible. Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 11 SUBJECT DISCUSSION ACTION CCC 2013 -28 Discussion and decision - making on a draft of the 2013 Annual Cost Control Commission Report summarizing the Commission's recommendations for the calendar year Chair Sterker called for a motion to approve the draft of the 2013 Cost Control Commission Annual Report as submitted. Commissioner Kaneshiro asked if the recommendation to increase the minimum fee for real property taxes should be included in the 2013 Annual Report. Chair Sterker stated that the recommendation is included in the discussion relating to the County's Real Property Tax Exemptions for the non - profit organizations. Vice Chair Kaneshiro requested that Section II of the draft Annual Report "Relating to the Commission's discussion on the following matters" be amended to add another bullet relating to a discussion to increase the County's minimum fee for real property taxes. Staff pointed out to the Commission that the discussion to increase the minimum fee for real property taxes took place in 2012 and therefore it would not be included in the 2013 Annual Report. Chair Sterker agreed with Staff then called for the approval of the County Cost Control Commission 2013 Annual Report as submitted. Commissioner Chaffin moved to approve the draft Cost Control Commission 2013 Annual Report as submitted. Commissioner Yoshida seconded the motion. Motion carried 6:0 Announcements Next meeting — January 13, 2014, at 1:30 p.m. at the Mo'ikeha Building, Liquor Conference Room 3. Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 12 SUBJECT DISCUSSION ACTION Commissioner Yoshida asked if it was appropriate at this time to talk about new agenda items for the January meeting, or should the Commission submit it to Staff prior to the posting of the agenda. She also asked if the Commission wanted to have more discussion relative to Councilmember Yukimura's request to look at the current system and make recommendations to change how the County negotiates with each bargaining unit. Chair Sterker noted that it wasn't really a request but more for informational purposes. Commissioner Apao asked whether it would be appropriate for the Commission to invite the arbitrator to a meeting. Ms. Esaki clarified that Councilmember Yukimura wanted to inform the Cost Control Commission about the recent decision and its financial impact to the County, and to ask the Commission to look long range on how the County makes decisions relating to costs. Commissioner Yoshida indicated that it seemed to her that the County is always lagging six (6) months behind of the previous fiscal year. For example, the fiscal year that ended in June 2012 is only now being certified, which could have been a problem if the County was going through arbitration in October or November because the financial information is at least fifteen months old. She pointed out that this could be an area for the Commission to have more dialogue because the County needs to have a better financial picture to present during the negotiations. Commissioner Nakashima pointed out that Councilmember Yukimura brought up a concept that the Mayor would be making less than a Police Captain because of the recent arbitrator's agreement, which to her should not make a difference because the bigger picture is that the County cannot afford to continue down this path and that it needs to find a way to reduce Cost Control Commission Regular Meeting - Open Session December 9, 2013 Page 13 SUBJECT DISCUSSION ACTION the difference. For example, the County could give the managerial level positions a 1% pay increase and give a 5% pay increase to the secretaries to help reduce the difference instead of continuing down its current path, which gives pay increases to only management level positions. Chair Sterker thanked her fellow Commissioners for a job well done and wished them all a Merry Christmas. Adjournment With no further business to discuss, Chair Sterker called for a motion to Commissioner Yoshida moved to adjourn the adjourn the meeting. meeting. Commissioner Chaffin seconded the motion. Motion carried 6:0 At 2:55 p.m. the meeting adjourned. Submitted by: Mercedes Youn, Staff Support Clerk Reviewed and Approved by: ( ) Approved as circulated (X) Approved as amended. See minutes of January 13, 2014 meeting. Arryl Kaneshiro, Chair -elect