Open Your Pockets, Seattle...

[JayB]

 

"King County threatened with $45 million deficit

Balancing budget likely requires cuts in services

 

By GREGORY ROBERTS

P-I REPORTER

 

With a cooling economy pinching tax revenue even as government costs rise, King County faces a $45 million budget deficit in 2009 unless services are cut below current levels, county officials said Tuesday.

 

That projection is gloomier than the $25 million general fund shortfall for 2009 forecast by County Executive Ron Sims in October. And the years beyond 2009 look worse still, county Budget Director Bob Cowan said.

 

Thanks to a strong regional economy, the county has not had to cut services since 2006. Although costs grew slightly faster than revenue in that period, budgets have been balanced by tapping accumulated reserves.

 

Some reserves remain -- including those designated for specific purposes -- but overall, they've been significantly depleted, Cowan said. And the revenue outlook for 2009 looks dim because the projected revenue set against the projected cost of maintaining the current level of service won't be enough.

 

In a presentation he's to give Wednesday to the County Council, Cowan focused Tuesday on the general fund, which accounts for $645 million of the county's total 2008 budget and goes mainly for jails, courts and the Sheriff's Office. The rest of the $4.9 billion spending plan includes construction projects and specific services such as Metro Transit and county road maintenance.

 

The general fund relies primarily on sales and property taxes. The recent rapid growth in sales tax revenue is slowing with the economy. Property tax growth also is faltering: Although overall tax increases on existing property are capped at 1 percent in any event, new construction is exempt from that limit, and the housing slowdown has put a crimp in that revenue source, Cowan said.

 

Meanwhile, the county's unionized employees receive annual cost-of-living salary adjustments and the expense of their county-supported health insurance is increasing faster than revenue. Energy costs, too, are soaring.

 

Balancing the budget likely will mean cuts in the existing level of services, Cowan said. The county hopes it can contain employee health costs and realize savings in the courts, he said. Revenue could increase if the Legislature authorizes counties to collect the kinds of utility taxes that cities impose.

 

Sims is asking departments to look for savings, his top aide, Curt Triplett, said. Sims is to present the 2009 budget to the council in the fall, with the council adopting a spending plan by the end of this year."

 

 

[Hugh Conway]

Meanwhile, the county's unionized employees receive annual cost-of-living salary adjustments and the expense of their county-supported health insurance is increasing faster than revenue. Energy costs, too, are soaring.

 

cost of living and health insurance! OMFG!

 

you want competent employees you have to pay for them. cut wages and benefits, people leave and it will end up costing you more to do less

[marylou]

Meanwhile, the county's unionized employees receive annual cost-of-living salary adjustments and the expense of their county-supported health insurance is increasing faster than revenue. Energy costs, too, are soaring.

 

The unions have contracts and health costs are going up for everyone.

 

What's your point?

[JayB]

The public sector unions should be glad that the folks who are subject to layoffs, salary freezes, who shoulder a greater share of the cost for their health insurance benefits, who work for enterprises in which wages are governed by the value of the goods and services that they generate, etc are feeling so generous.

 

 

[grtmtnchic]

Meanwhile, the county's unionized employees receive annual cost-of-living salary adjustments and the expense of their county-supported health insurance is increasing faster than revenue. Energy costs, too, are soaring.

 

cost of living and health insurance! OMFG!

 

you want competent employees you have to pay for them. cut wages and benefits, people leave and it will end up costing you more to do less

 

Have to say, after being a gov't employee for a long time, there's a lot of INCOMPETENT gov't employees (not me, of course) soaking up all those good benefits and pay increases. The system kinda needs an overhaul - such as merit pay increases to replace blanket COLA's. The health insurance for gov't employees is a really sweet deal! Too sweet? Well, I'd be the last one to complain. From what I've witnessed, once someone's in the gov't system it's really hard to get rid of them, regardless of how incompetent they are.

 

 

 

[grtmtnchic]

The public sector unions should be glad that the folks who are subject to layoffs, salary freezes, who shoulder a greater share of the cost for their health insurance benefits, who work for enterprises in which wages are governed by the value of the goods and services that they generate, etc are feeling so generous.

 

 

well put!

[JayB]

Meanwhile, the county's unionized employees receive annual cost-of-living salary adjustments and the expense of their county-supported health insurance is increasing faster than revenue. Energy costs, too, are soaring.

 

cost of living and health insurance! OMFG!

 

you want competent employees you have to pay for them. cut wages and benefits, people leave and it will end up costing you more to do less

 

In cases of highly skilled employees, perhaps. Doctors, lawyers, engineers, programmers, executives, etc. What percentage of public employees actually fall into this category?

 

When it comes to the folks performing manual, clerical, or other jobs, their total compensation likely exceeds anything that they could get in the private sector. If you think otherwise, I invite

you to ponder the size of the line the next time that the Washington State Ferries announce that they'll be hiring. Or, the next time that you are in MA, ask the guy in the booth where else he'd take home total compensation averaging $66K a year for making change.

 

Taxing people who are subject to economic realities, in order to insulate those who subsist on their taxes from the said economic realities - will only go on for so long. I suspect that simple economics will force the issue before the voters do.

[grtmtnchic]

In cases of highly skilled employees, perhaps. Doctors, lawyers, engineers, programmers, executives, etc. What percentage of public employees actually fall into this category?

 

Well, I agree with your argument as far as the types of jobs you mention (clerical, manual, etc.), BUT there actually are a lot of "highly skilled" positions that are local, state or federally funded, like in higher education. Beware of making such a broad generalization.

 

 

[prole]

Step right up everybody! See, right before your very eyes, an article on cutting services in an economic downturn miraculously transformed into an opportunity for union bashing. No tricks here ladies and gentlemen, it's just a matter of selecting a single sentence and then framing the debate! Oooh...Aahhh.

[Hugh Conway]

Taxing people who are subject to economic realities, in order to insulate those who subsist on their taxes from the said economic realities - will only go on for so long. I suspect that simple economics will force the issue before the voters do.

 

Not subject to economic realities? Huh? King County had layoffs this decade!

http://seattlepi.nwsource.com/local/82930_layoffs16.shtml

http://www.metrokc.gov/exec/news/2001/061401letteremp.htm

 

Funny how you didn't point the finger at the one group in the public sector who could best be considering overpaid - Firemen.

[JayB]

Show me the stats on private versus public sector layoffs relative to their percentage of the labor force and then you'll have a case.

 

 

How many Boeing workers lost their jobs between 2001 and 2004?

 

 

[JayB]

In cases of highly skilled employees, perhaps. Doctors, lawyers, engineers, programmers, executives, etc. What percentage of public employees actually fall into this category?

 

Well, I agree with your argument as far as the types of jobs you mention (clerical, manual, etc.), BUT there actually are a lot of "highly skilled" positions that are local, state or federally funded, like in higher education. Beware of making such a broad generalization.

 

 

I'd include some university professors in the topmost category, but relatively few outside of science, engineering, medicine, or business have skillsets that would enable them to earn a higher salary in the private sector, and most of them would be loathe to make such a move. In the case of university faculty, the main risk of uncompetitive salary packages would be losing them to other universities.

[Hugh Conway]

Show me the stats on private versus public sector layoffs relative to their percentage of the labor force and then you'll have a case.

 

yawn - the demand for services is rather constant, no? Or in the next recession should we just stop having a legal system?

[Hugh Conway]

I'd include some university professors in the topmost category, but relatively few outside of science, engineering, medicine, or business have skillsets that would enable them to earn a higher salary in the private sector, and most of them would be loathe to make such a move. In the case of university faculty, the main risk of uncompetitive salary packages would be losing them to other universities.

 

Where do you think the Cato Institute recruits from?

[JayB]

Taxing people who are subject to economic realities, in order to insulate those who subsist on their taxes from the said economic realities - will only go on for so long. I suspect that simple economics will force the issue before the voters do.

 

Not subject to economic realities? Huh? King County had layoffs this decade!

http://seattlepi.nwsource.com/local/82930_layoffs16.shtml

http://www.metrokc.gov/exec/news/2001/061401letteremp.htm

 

Funny how you didn't point the finger at the one group in the public sector who could best be considering overpaid - Firemen.

 

Firemen are up there, but when change-makers are clearing $66K in total compensation, there's plenty of competition for the top prize.

 

 

[Hugh Conway]

Firemen are up there

 

In 2002 >50% of Oakland's firefighters made over $100k. One made $108k in overtime alone The change taker doesn't get paid to play poker

[JayB]

Show me the stats on private versus public sector layoffs relative to their percentage of the labor force and then you'll have a case.

 

yawn - the demand for services is rather constant, no? Or in the next recession should we just stop having a legal system?

 

I think that easing off of the auto-COLA's, brining employee health insurance contributions in line with those that prevail in the private sector, transitioning to defined contribution plans instead of fixed pensions, tying compensation in manual/clerical and all other easily replaceable positions to private sector averages, eliminating promotion based on seniority, making the process of elminating poor employees more efficient, etc would provide for better services in good times, and make the need for either higher taxes or service cuts less probable in recessions.

 

Keep pretending that civilization will collapse if the Document Specialist 4's actually make market wages, pay for more of their own health care, earn raises instead of having them granted automatically, etc though if you need to....

 

 

[grtmtnchic]

Firemen are up there, but when change-makers are clearing $66K in total compensation, there's plenty of competition for the top prize.

 

 

OK, Jay, how about we limit this discussion to the "change-makers" and other similar clerical/manual/menial positions...there are too many exceptions otherwise. I'm with you on that level of employee that their total compensation package far exceeds anything they could get in the private sector.

 

 

[JayB]

Firemen are up there

 

In 2002 >50% of Oakland's firefighters made over $100k. One made $108k in overtime alone The change taker doesn't get paid to play poker

 

 

The only thing that keeps them out of the top category is that their functions couldn't be automated with a net gain to society.

 

I've always thought that they were underworked and overpaid, and that the wages that they've managed to secure far exceed those would would be required to staff the positions with qualified people.

 

Unfortunately, questioning their compensation has become rather taboo as of late.

 

 

[JayB]

Step right up everybody! See, right before your very eyes, an article on cutting services in an economic downturn miraculously transformed into an opportunity for union bashing. No tricks here ladies and gentlemen, it's just a matter of selecting a single sentence and then framing the debate! Oooh...Aahhh.

 

Also put the bit about the effect of asset-class-that-never-loses value, and the sector that will never sustain a downturn or correction in bold. Open your eyes, class warrior.

[grtmtnchic]

Show me the stats on private versus public sector layoffs relative to their percentage of the labor force and then you'll have a case.

 

yawn - the demand for services is rather constant, no? Or in the next recession should we just stop having a legal system?

 

I think that easing off of the auto-COLA's, brining employee health insurance contributions in line with those that prevail in the private sector, transitioning to defined contribution plans instead of fixed pensions, tying compensation in manual/clerical and all other easily replaceable positions to private sector averages, eliminating promotion based on seniority, making the process of elminating poor employees more efficient, etc would provide for better services in good times, and make the need for either higher taxes or service cuts less probable in recessions.

 

Keep pretending that civilization will collapse if the Document Specialist 4's actually make market wages, pay for more of their own health care, earn raises instead of having them granted automatically, etc though if you need to....

 

 

I'm with you on all of this. However, supposedly all positions are analyzed and their payscale is set to equal private averages. I'd really like to know who does that study, however, and whether it looks at hourly rate or total compensation. Last fiscal year, some positions saw 25% pay raises!!!!! to bring them UP to the private average. A whole slew of positions saw pay increases in the 12-25% range. It was unbelievable. I have a really hard time believing the justification for that took into account total comp.

 

 

[Stefan]

hopefully they will cut police for less traffic tickets!

[JayB]

Sounds quite hard to believe, especially when you factor in future pension liabilities, etc - let alone money wages.

 

Then there's the matter of how many public employees would actually stay in their current jobs if they knew that they could score a 25% raise by jumping ship.

[JayB]

hopefully they will cut police for less traffic tickets!

 

Actually, they (Nick Licatta) plan to milk you for more fines with red-light cameras. Far more effecting at boosting revenue than improving safety.

[grtmtnchic]

Sounds quite hard to believe, especially when you factor in future pension liabilities, etc - let alone money wages.

 

Then there's the matter of how many public employees would actually stay in their current jobs if they knew that they could score a 25% raise by jumping ship.

 

The list of positions affected by that FY "adjustment" was pages long. My personal experience is limited to higher ed, and most of the positions affected were specialized, like childcare center workers, lab technicians, etc. Maybe in Seattle they could "jump ship" to better paying jobs prior to this increase, but a huge percentage of gov't employees are in cities with depressed economies (I'm from the eastside of the state). The best employer BY FAR is the gov't in most smaller towns. People rarely jump ship from gov't jobs in eastside towns, not without a really strong reason.