News and Tribune

Business/Money

July 31, 2010

GROWING GOVERNMENT: Jeffersonville's city salaries increase by nearly half in five years

JEFFERSONVILLE — As the Jeffersonville City Council has considered a salary study, pay increases and raises for unionized police officers and firefighters in the last few weeks, city records show that spending on employees’ salaries has increased by nearly 50 percent in the last few years.

The number of positions listed in the city’s salary ordinance has also swelled  by 71 during the same period: Going from 262 positions in 2005 to 333 positions in 2009.

In explaining the increase, Mayor Tom Galligan and other city officials point to the fact that Jeffersonville’s borders have expanded via annexation and a 2008 takeover of the city sewer plant, which had previously been operated by a private contractor.

Another update to the city’s salary ordinance — one that would increase annual payroll by $76,000 — may soon be back up for consideration in the next month. In the meantime, The Evening News has looked back at five years worth of salary ordinances and employee job pay summary reports generated by the Clerk-Treasurer’s office.

The job pay reports — which total up each employee’s base salary, longevity pay, overtime, certification pay and other compensation —  showed that total salaries went from $9.53 million in 2005 to $14.25 million in 2009.

In order to gauge the number of positions, the newspaper counted each title in the salary ordinance to conclude there were 333 city positions in 2009. Some employees staff multiple positions in the ordinance — for instance a deputy clerk might double as the city council’s stenographer —  so that doesn’t necessarily mean there are 333 employees.

When Galligan took office, he created numerous new positions, including a finance director, communications director, growth coordinator and others. Some of those positions were created as need arose, but a few were announced in December 2007, the month before he came to office.

TAKING THE SEWER PLANT

However, it was what happened a full year later, in December 2008, that contributed heavily to the growth of city government.

It was about then that Galligan, along with two police officers, took control of the city’s wastewater treatment plant from Environmental Management Corp., a company that had been contracted to run the plant a few years prior. About the same time, the council approved an update that added 21 employees to the salary ordinance to run the plant. A legal battle over the contract continues.

“What we did is rearrange where the money is going,” said Galligan, noting that EMC was being paid $1.4 million annually to operate the plant.

The employee job pay summaries showed that wastewater treatment plant salaries totaled up to about $1.33 million in 2009, the first full year of having a city-run sewer plant. However, that doesn’t include the insurance and benefits costs the city covers.

The plant takeover took place during a time when the city was negotiating with the U.S. Environmental Protection Agency about the need to eliminate combined storm water and sanitary sewer overflows. Galligan said the takeover of the sewer plant was a large part of that because “things we were supposed to get done, weren’t getting done because [EMC] didn’t have the staff.”

Galligan said a lack of maintenance and staff led to the takeover. Company attorneys argued during the subsequent trial that its staffing at the plant met contractual obligations. And EMC was awarded $584,111 in lost profits and attorney fees after the trial. The city is appealing.

“Without a question, we’re getting much more for our money,” said Council President Nathan Samuel, who said he’s toured the plant and seen some of the improvements that have taken place.

“Privatization doesn’t work well,” Galligan said, “because you can’t control your costs.”

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