Main Street Journal: My Memphis Budget Wish List

The following article is taken from the January, 2009 issue of the Main Street Journal. Click “Subscribe Online” above to start your subscription.

My Memphis Budget Wish List
By: Joe Saino

A new year and new budget (2010) are to be developed and presented to the Memphis City Council and the Shelby County Commission. What is the process and what ideas should be considered? We hear from the Mayor that he is finally going to cut some people and will consider cutting some benefits. How much and which ones are the question.

The 2009 budget hearing schedule began in April with an introduction and an overview presented by the administration to the City Council. Then each department presents their song and dance for the various departments such as police (35% of budget), fire (24%), grants and agencies (13%) and on and on. The CIP (Capital Improvement Budget) is also presented to determine what projects will be funded for the next five years.

The big thing that is not talked about is fundamental changes and in this coming year we must change this plan and talk about long term fundamental changes in order to survive in a world of shrinking resources. We must learn to operate with less and do more. We must improve productivity which is the only way to continue to deliver needed services to the hard pressed and shrinking base of taxpayers.
I have been thinking about these fundamental changes and here is my New Year Wish list of things that must be acted on.

1) A 10% personnel cut in the City of Memphis. The actual funded staffing level for 2007 was 5534. The adopted 2009 funded staffing level was 6309, an increase of 14%. A 10% cut is not unreasonable. It should be across the board from the top to the bottom. For instance, we do not need a deputy director in each department. This is a layer of bureaucracy that we can do without.

2) We need a fundamental change in our personnel policy to bring it more in line with the “for profit” world where all the tax money originates. We now have at the top end of years in service (15 years or more) 5 weeks vacation, 5 weeks of sick days, 11 holidays, 4 bonus days and three days death in family leave. This amounts to over ¼ of the year. On top of this we have the federal FLMA (Family Leave Medical Act) which allows up to 12 weeks of unpaid leave for various reasons.

3) We have over $3 billion of unfunded liability in OPEB costs (other post employment benefits) that represent promises made by politicians for retiree health care costs but without the money set aside too pay for them. We are now promising to pay 70 to 75 percent of these costs. We need to reduce this promise by 5% a year for the next 14 years so that the retirees can prepare for this reduction.

4) We need to move to a defined contribution pension plan similar to a 401K used in the for profit world of companies for all new employees. The present plan for existing qualified employees would be maintained.

5) We need to look at changing the retirement age of employees which currently is after 25 years of service regardless of age. The highest cost of retiree medical insurance is for retirees at ages before they become eligible for Medicare.

The guiding principle of these recommendations is that public employees’ salaries and benefits should be no greater than the salaries and benefits of the taxpayers (the people who work in “for profit” businesses). Fairness and equity demand this.

Close Bookmark and Share This Page

Save to Browser Favorites / Bookmarks