Miami Herald Today

Trim salaries of pork-laden municipalities
By JACKIE BUENO SOUSA
jsousa@MiamiHerald.com
A few years ago, former Miami Beach Mayor Neisen Kasdin, an attorney, was trying to hire an administrative assistant at his downtown law firm. Having found a good candidate, he made what he thought was a competitive offer, about $60,000 a year.

But the candidate turned it down; she had received a richer, $70,000-plus offer from another employer. The amount of the competing offer was surprising enough, but what really struck Kasdin was the identity of the employer: the city of Miami Beach.

''Government salaries are off-the-charts ridiculous,'' says Kasdin. ``The salaries are phenomenal and the pensions are even better.''

Once, working for the government meant you traded good pay for job security and a generous pension. But while the private sector has squeezed pay and reduced staff in a search for efficiency, the trend has been the reverse with many local governments.

The result is that taxpayers are funding overly generous pay and benefit packages even as their own income and benefits are fading. As cities and counties struggle with their budgets, it's time to scrutinize personnel costs, which typically account for about 70 percent of local-government expenses.

GLIMMER OF CHANGE

Already some cities are acknowledging the problem. The city of Miami last week announced a hiring freeze and told workers they could no longer compensate for overtime by taking days off. Such tactics may be just the start. The problem isn't just the number of employees, but also the compensation of those workers.

According to a recent study by the Bureau of Labor Statistics, full-time employees of local governments throughout the country make an average of $25.16 an hour, out-earning every other employment category studied, including the private sector ($20.46), nonprofits ($21.68) and state governments ($23.77).

Few cities illustrate the trend better than Miami Beach, where a receptionist can earn upward of $50,000 a year and where a recent study revealed that annual wage increases are more than double the national average. Miami Beach now has among the highest-paid municipal workers in the country.

That's before accounting for the city's employee benefits, which include pension plans that allow many workers to continue collecting a large chunk of that generous income after retirement. This year the city is expected to spend about $34 million on pensions, with the cost expected to grow 20 percent next year to $40 million.

WE'RE NOT ALONE

Miami Beach's generosity with taxpayer dollars is hardly an anomaly, says Dominic Calabro, president of Florida Tax Watch, a nonprofit research institute. Florida's cities and counties have been particularly irresponsible when it comes to personnel, he says.

''They're out of touch with the realities of the marketplace,'' he says.

Historically, local governments have immediately cried that any cuts would come out of service delivery. But such a response holds less and less merit when there's so much fat on the payrolls.

As they consider changes, cities and counties should avoid making across-the-board cuts and, instead, focus on eliminating their least-performing workers. It may not be politically correct, but no organization, private or public, can afford to retain unproductive workers and lose good ones.

One solution, Calabro suggests, is for cities and counties to cut the lowest-performing 5 percent of their employees.

''And if they don't know who they are,'' he says, ``shame on them.''