In last Thursday’s post I shared some preliminary observations about the latest contract between the City of DeKalb and the firefighters’ union.

Since then I’ve gotten a little feedback on it behind the scenes. The gist of the response is this: What’s the deal? Does yinn have something against well-compensated public employees?

The short answer is that I believe city employees and especially public safety employees deserve every penny we can afford.

The larger deal is that since late 2007 — despite hiring freezes, layoffs, reorganizations and attrition — the City of DeKalb has essentially been reacting continually to financial crises and deficits and in early 2010, city officials said that something drastic had to happen in order to avoid being $5 million in the hole by the end of FY2011.

Then DeKalb ended up with a $6.3 million audited surplus for FY2011.

The question is, does this surplus reflect real recovery and growth? Or will we, in the midst of hiring and giving generous raises a couple years out, be forced yet again to lay off and reorganize due to personnel costs outpacing revenues?

In other words, one year of surplus does not necessarily mean we have fixed our structural issues. Let’s see if we can figure it out.

Below are numbers taken from Fire Department budgets, because that’s what’s in front of me right now (but I assure you there’s a similar trend for DeKalb Police).

Fiscal
Year
No. of FD
Employees
Budgeted
FD
Personnel
Budget
Total
FD
Budget
Total
General
Fund
Budget
2007627,184,1057,585,96527,279,839
2008627,802,5868,212,48328,562,766
2009628,518,2898,943,12629,155,032
2010608,771,9329,196,76929,374,278
2011558,435,1838,877,77828,132,528
2012548,937,9869,295,55830,137,880

The actual FD expenditures are lower than the budget figures for most years, I think because the FD has not staffed at budgeted levels since 2008 or 2009. Still, you can see the point: with few exceptions, increases in the total FD budget are driven overwhelmingly by annual increases in personnel costs of $500,000, $600,000 or more.

Clearly, these kinds of jumps are not only about 4% general raises. Below, you can spot the other culprits:

FD Budget ExpenditureFY2006FY2012
Health Insurance791,9861,106,525
Longevity Bonus43,86147,700
Overtime929,658647,961
Police/Fire Pension1,062,7352,044,625
Regular Wages3,813,7394,478,300
Workers Comp238,197498,000

We’ve already examined Workers Comp and someday soon we need to talk pensions; but for now, let’s just address whether we should be adding $1 million per year to police and fire budgets at this time. For that, I’ve pulled from the FY2011 Comprehensive Annual Financial Report (CAFR). Here are the most significant revenue changes from FY2010 to FY2011:

— Increases of $1.3 million in capital grants
— Increases of $769,500 in operating grants
— Increase of $668,367 in utility taxes
— $758,500 for first year of TIF declared surplus
— Increase of $500,000 in charges for services
— Increases of $175,400 in sales taxes
— Increase of $89,000 in state income tax share

Additional surplus came from refinancing the debt and from lowered health insurance costs, compliments of the Voluntary Separation and the gutting of Public Works.

What we are looking for in these numbers are stability and real growth so we can justify hiring more people and giving them regular raises. I’m sorry to say this isn’t it. Grants are quite variable from year to year and are often restricted as to use. The refinancing money has similarly been earmarked for other purposes. The increase in utility tax revenues is due to a tax hike, and the increase in charges for services is partly due to a scheduled (4th annual?) rise in water rates ($217,300). The TIF “surplus” is already taking a dive in response to lowered EAV and is projected at $84,000 less in this, its second year.

The only totally “natural” revenue growth I see is in sales taxes and state income tax share totaling $264,400. But I have to wonder how factors such as the “Hy-Vee effect” and the State of Illinois’ own financial woes will impact these streams in the next year or two.

So, no; unless the recovery picks up more than the current forecast says it will, I do not think we can support for long the new hires and raises that we seem to be destined to provide. Not unless we hike taxes again, I mean. For about the dozenth time in the past four years.

By the way, when was the last time you got a raise?

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Additional sources: annual budgets from the City of DeKalb Downloads page.