News Release
April 10, 2009
Concord leadership takes 5 percent pay cut to help address budget shortfall
Concord's City Manager and Executive Team today announced a voluntary 5 percent reduction in their compensation next year to help reduce the City's $10 million budget shortfall.
In addition to the 5 percent reduction, City-paid contributions to 401K plans, Pay for Performance merit awards and an annual $2,000 flexible benefit payment will be suspended.
"I'm proud that our Executive Team has stepped up to the plate in voluntarily taking these cuts," said Mayor Laura Hoffmeister.
Concord has an $80 million General Fund budget and 499 full-time employees. Sales tax and property tax revenues, which comprise 66 percent of the General Fund, have experienced unprecedented double-digit declines due to the recession, leaving a $10 million hole in next year's budget. (The City's fiscal year runs from July 1 to June 30.)
"In times such as these, I believe it is critically important that those in management positions demonstrate leadership," said City Manager Dan Keen.
"While our actions alone will not solve Concord's budget problem, we are glad to do our part to help reduce the budget deficit," he said.
In addition, Keen is recommending to the City Council that all 63 non-sworn management and confidential employees participate in the 5 percent reduction in compensation. Under the plan, managers would also give up Pay for Performance merit awards and their flexible benefit payment. Confidential employees would forego step increases.
The reduction in compensation and benefits equates to approximately $640,000 in savings to the General Fund. Employees will take 13 unpaid furlough days next year to achieve the 5 percent reduction in compensation.
These actions are on top of budget reductions approved by the City Council in January to balance the current year's 2008-09 budget. Those reductions included $4 million in cuts and the use of $3.2 million in reserves.
"This is just one of the first steps in wrestling with the budget deficit. The City Council and Executive Team will still need to consider many other options to close the budget gap," Keen said.
Some of the options under consideration were suggested by the Task Force on Budget Stability, appointed by the City Manager in December. The 23-member group reviewed over 1,200 suggestions submitted by employees. Many of those suggestions are already being implemented and others will be introduced at the Budget Workshop in May.
"We will also be meeting with union reps from Administrative, Technical & Clerical/Field & Operations (ATC&FO) Local One, Concord Associated Professional Employees (CAPE), Police Officer and Police Management Units," he said.
"I wish I could promise no cuts to City programs or further impacts to employees, but at this point there are no guarantees. While we're working hard to preserve all our programs, we still don't know when the economy will recover, or how long it will be before our sales tax and property tax figures improve," he said.
Budget Workshops are scheduled for May 4 and 6 at 5:30 p.m. in the City Council Chamber at Civic Center, 1950 Parkside Drive. The meetings will be televised on Concord Cable TV channel 28 (Comcast) and 29 (Astound) and can be viewed from the City's website at www.cityofconcord.org. Budget hearings are set for June 1 and 22, also at 5:30 p.m. in the City Council Chamber.
For more information, visit www.cityofconcord.org and select "Budget Update" from the News & Events box.
Contacts
Leslye Asera, Community Relations Manager, (925) 671-3272
lasera@ci.concord.ca.us