Common Council V Halverson: Pay Plan Debate Divides
An Unlikely Trio: Alderwoman Joanne Suomi and Aldermen Mike O’Meara and Jerry Moore all disagreed with the mayor’s plan to change a newly- implemented pay plan for city workers. (City-Times photo)
“We’re being asked to endorse this process without ever getting to examine what this process was.” -Mike O’Meara
By Brandi Makuski
Modifying a newly-implemented pay plan for the City of Stevens Point brought city leaders to a series of verbal blows Monday night, with all parties walking away not just unhappy- but angry.
In 2013 the city hired Madison-based consulting firm Carlson Dettmann to perform a compensation study of city employee salaries and job descriptions. The study showed most management and some employees were underpaid, with many non-management workers overpaid. Last year Council Members were charged with changing the city’s pay plan to reflect those results, effectively increasing many salaries based on average market wages from a list of comparable cities- a list chosen by the mayor and narrowed by the Council.
“We have to recognize if we do want to keep the best, and more importantly, get (recruit) the best, as vacancies occur, we have to be competitive out there,” Mayor Andrew Halverson told the Council Monday.
But now, the Council is being asked to change that list of comparable cities to give a wider range of salary averages. The full Common Council was convened Monday for a special meeting to consider altering the pay plan it had previously approved last year, and also to add cities it had previously excluded from the list of comparables against which Stevens Point would be measured. The new result, according to Halverson, would mean more equitable pay for all city workers with a new maximum of 115 percent of the average market data the new list would provide.
According to Halverson, the data provided to the council last year was already “8 or 9 months old” by the time it reached the desks of city leaders, and new data was now needed as many of those cities had since implemented new pay plans.
Council Members had removed La Crosse, Eau Claire and De Pere from the list of comparables provided by the mayor, saying those cities shouldn’t be compared with Stevens Point because those cities had higher populations and equalized values. Halverson now said those cities, along with Sun Prairie, need to go back into that list to keep the pay plan competitive throughout the state.
“What I’m asking you to consider is having Carlson Dettmann run off an entirely new matrix, which we would then calculate the exact financial implications of, and then we would be providing that next month for your consideration,” Halverson said.
When pressed for assurance the new matrix wouldn’t cost more than the $25,000 fee charged last year for the study, Halverson said he assumed that was the case.
“Is that our assumption or their assumption?” Asked Alderman Mike Wiza.
“That’s my assumption, currently,” Halverson said, adding he was “fairly” confident that was the case. “But we need to be competitive statewide.”
For over an hour Council Members questioned the merits of changing the pay plan which took several months of discussion to approve last year, as well as the timing of Halverson’s request and more than 20 as-of-yet unresolved appeals filed by city workers who felt they were graded unfairly in the current pay plan.
There was also debate on the lack of details the Council had repeatedly asked for regarding how the results were achieved for the new pay plan while they were simultaneously being asked to approve it.
The meeting was filled with sarcastic remarks and interruptions from Council Members unhappy with perceived rebukes by the mayor, who also defended Carlson Dettmann throughout the meeting.
“I’ll be honest with you in telling you this process has turned into a sideshow,” Halverson said. “Unfortunately it’s been fueled by misconceptions, issues and other concerns that have arisen, which is very unfortunate given the credibility used in creating the pay plan. The bottom line is this: the pay plan is very solid in terms of the statistics and data that go into it. Mr. Carlson used direction by the Council to create what you have. If we’re going to legitimately discuss (the appeals process), you’re going to have to have some kind of confidence in the pay plan that has already been implemented. If you don’t understand the process, and if you don’t understand what went into the plan, and you’re not going to be able to take the steps to learn it, then I don’t know why we’re wasting our time.”
Not moving forward on the plan was “violently disrespectful” to city employees, he said, and put the future of employee retention in jeopardy.
Alderman Roger Trzebiatowski said there’s a wall of mistrust between the Council and the mayor’s office- something he said largely stems from the Council being prohibited from seeing how Carlson Dettmann arrived at the final numbers of the pay plan, despite asking for it several times.
He also referenced publicly for the first time that the Council could have seen at least some of the details of the work, but only if each member signed a nondisclosure agreement as individual citizens rather than collectively as a city representative body. Trzebiatowski said he initially signed the agreement, but had since officially retracted it through the city attorney’s office. The whole process, he said, painted Council Members into a corner.
“The problem is that if anybody, including yourself (indicating Halverson), released information, and the company decided to retaliate against us and sue us, we would have individually been liable. We would have had to retain our own attorneys for merely doing our city function. That was the part, I think, myself and most of the Council took objection to. I think it was very poorly written.”
Alderman Mike O’Meara sided with the majority during the discussion, saying the Council has been put in an impossible position.
“My concern is the Carlson Dettmann plan has been a block box; we have not had a chance as a Council to compare the position descriptions of the comparables and how they were placed. So we’re asked to trust somebody I’ve never met; I think it’s reasonable for us to examine his work. I think in not doing it he (Charlie Carlson of Carlson Dettmann) produces his own mistrust. We’re being asked to endorse this process without ever getting to examine what this process was.”
O’Meara last month said he made a verbal open records request for the information through City Attorney Logan Beveridge but received no reply to the request, and later he consulted with an independent attorney to verify whether information requested from the company was indeed proprietary. He also balked at the idea of the nondisclosure agreement.
“The idea that we’re going to be personally liable, that’s really a bunch of bunk,” O’Meara said. “If it’s really proprietary, he wouldn’t show it to us. Proprietary is the formula for Coca-Cola; I don’t care what you sign they wouldn’t show it to you. What they’re asking us to do is trust his work without us being allowed to examine it. I don’t think that’s a reasonable thing for us to do. Our fiduciary responsibility is to the citizens of Stevens Point.”
“Mr. O’Meara hit it on the head- there’s a certain level of mistrust that has been building since almost day one,” Wiza said. “The fact that you say the information was available to us and we chose not to do it…if anybody saw that release, if anybody in the room would have even hinted- or even made up the fact that something was leaked- every single one of us would be held responsible, personally and financially. It wasn’t as simple as, ‘we chose not to do it’. If anything was disclosed; even if it wasn’t disclosed but somebody said they heard something from so-and-so, then it would be up to me to prove that I didn’t do it. That mistrust, from the whole process, I think is the biggest issue in our inability to believe in this matrix.”
But Halverson wasn’t sympathetic to the Council’s concerns about signing the agreement, saying it was their one chance to get some of the details they insisted upon. Without changes to the plan, he said, the city could be facing real problems retaining or recruiting qualified employees.
“Sure, you would’ve been on the hook personally, and the individual who released the information ultimately would have been the one who paid the price for that,” Halverson said. “As the city attorney determined, and certainly did a great deal of research on, is that there’s a lot of this particular process that is proprietary data protected by the consultant, as it should be. The opportunity for the alderpersons to view everything was obviously there.”
While City Attorney Logan Beveridge was unavailable for comment regarding the nature of the nondisclosure agreements, Halverson said the Council must now make a decision without the information they could have been privy to- something he reminded them of several times Monday night.
“You could’ve got them, you’re not going to now,” he added. “So, what is it you want us to provide, and are you going to listen to the warnings and suggestions that we’re laying out? We’re telling you the pay plan isn’t competitive, based on your decisions. Not mine, yours. Don’t be surprised when (employee retention) becomes a challenge in the future. We need some specific decisions made, I want to know what you want to do. I want to know what you want us to get you in terms of information, and I want direction. Because I’m just not going to worry about it anymore, quite frankly, because honestly it’s embarrassing. I have to tell you, this is probably one of the most embarrassing and ridiculous processes I’ve seen and we have to figure out how we’re going to get through it.”
There’s Only So Many Pieces of the Pie
Council President Jerry Moore said he had a “very large” problem with the recommendation of adding previously discounted cities back into the mix. The cities removed by the Council last year weren’t comparable, he said, because they had higher incomes and a wider tax base than Stevens Point.
“The one thing that hasn’t been discussed at all tonight- and definitely cannot be ignored- are the constituents of this community that pay the wages and benefits; they only have so much money. Most of the people I know don’t even make $20,000 a year,” Moore said. “We don’t have beautiful health benefits. It’s very difficult to hear people complain about making so much money. I have a lot of good friends, small business owners, people that believe in this community, that are scraping by everyday. And you want more money from them. That’s disingenuous.”
Moore said he also worried the city was “poking at a Jenga game” that would fall apart.
“This pay plan we just approved this last year was supposed to solve those issues,” he said.
Alderman Randy Stroik said he worried the Council hadn’t been provided with any estimates of how much the mayor’s recommendations would cost the city.
“The fact of the matter is, if you’re underpaid right now, under the new pay plan we did, then the pay plan failed us from the very beginning,” Stroik said. “Don’t blame this on the Council. That should have gotten us to market (average). To me this seems like all these appeals we haven’t seen yet as a Council probably have some legitimacy. That may not be the case, but that’s sure what it seems like to me. Something just doesn’t add up, I can’t support this. I want to see the analysis from the comptroller before I agree to anything.”
City Comptroller-Treasurer Corey Ladick said his office had no data to offer, after which Halverson stated a prorated estimate of $60,000 starting June 1 came from the human resources department.
Halverson said he the annual cost of changes to the pay plan rests around $130,000. That’s in addition to the $115,000 in wage increases implemented by the pay plan approved last year, showing how far below the market norm the city is currently compensating workers.
“You made a significant error as a Council when you did not leave those comparables in the mix,” Halverson said. “It was grounded in reasoning; they’re larger communities, this is true, and they pay different than us-”
“Because they have a larger pool of money to draw from,” Moore interrupted.
“Well, that’s the qualitative part of right and wrong, and that’s what we really have to wrestle with,” Halverson replied.
Moore said the Council did wrestle with those factors when they decided to remove certain cities from the list. The city can only afford so much for wages, Moore argued, also pointing out Council Members had debated the new pay plan for several months last year.
“So don’t tell us we did something wrong- it was only wrong in your opinion. Why we wanted those out of there was based on fact: they were different class cities, they have a different tax structure, and a different pool of money to draw from. This community does not have that.” Moore said. “So that’s not a true comparable. I understand what you’re trying to say, but money is not the only thing that drives a person to take a job.”
“That may or may not be the case, but it’s obviously a large driving factor,” Halverson said. “The conversation needs to be more philosophical before we consider financial implications. We need to talk about short-term employment gains and losses and long-term employment gains and losses. It will cost more money, but an investment we want to make in the quality we want to preserve.”
Alderwoman Joanne Suomi, who was visibly upset throughout the meeting, said the conversation was ill-timed.
“I’m concerned about the timing of this suggestion. Personally, I think this conversation is out of line,” Suomi said. “Why aren’t we discussing this in November for next year’s budget? We have an appeals process; why aren’t we starting that?”
As part of the new pay plan adopted last year, the Council agreed to allow Halverson and Carlson to handle initial appeals, which Halverson had previously stated would begin on Jan. 23. Employees not satisfied with that outcome would then come before the city’s Personnel Committee for further consideration. To date, the committee hasn’t considered any appeals.
“I haven’t touched the appeals process because, quite frankly, my assumption was the alderpersons were going to be positioned in a situation where they would have confidence in the process that was used to create the pay plan,” Halverson said. “If the alderpersons aren’t going to have confidence in any element of the pay plan, I don’t know what the effectiveness of the appeals process was going to be. We haven’t touched the appeals process very much on purpose.”
But the bottom line, according to Halverson, is where to go from here.
“We have a pay plan we either need to work with now or modify to reflect comparables,” he told the Council.
Alderman Mike Phillips said the appeals process should move on “immediately” with the current pay plan.
“Before next year’s 2015 budgetary process, then we could look at modifying this and adding those variables,” he said. “I think this is a good place to start. He gave us this information; we said we’d move forward with it. Let’s move forward with this.”
The Council ultimately voted to stay with the pay plan they had already adopted last year, but also agreed to see a new matrix with the new comparables requested by the mayor. More details will be provided to the Council in May, Halverson said.