Bell Tolls for Effective Communication of Compensation

NOTE: The following represents the analysis-based opinion of the author and do not reflect those of his employer or any other affiliations.Abuse of the public trust for personal, monetary gain is almost equivalent to treason. At the very least, as the former City Manager, Assistant City Manager, and all but one elected official of Bell, California, have learned, it is definitely criminal.

The scandal involving the “Bell 8” over their excessive pay and benefits took a serious turn last week when they were arrested on dozens of charges stemming from actions that included excessive salaries for paid staff, stipends for City Council members to serve on boards and commissions that barely met, and  inappropriate loans of City funds to individuals and civic groups. Their former City Manager alone faces 53 counts involving the misappropriation of more than $5 million of taxpayer funds.

The lasting impact for Bell, a working class city with one of the highest tax rates in California and a significant debt burden, could be far worse. Audits have uncovered millions in illegal tax collections that will have to be repaid. Far more difficult for the City and its remaining leadership will be restoring any semblance of trust or respect with their citizens.

Beyond Bell and Los Angeles County, the scandal served as another reminder of the significant disconnect in communication between local governments and the citizens they are supposed to serve. As I mentioned last week, the growing gap in compensation between government and private sector employees is very significant, and it has been growing in the same direction for about forty years. Government data basically shows that, as a whole, the conventional wisdom that government employees did not earn as much as their private counterparts on the basis of salary is no longer accurate, and has not been for decades.

Naturally, citizens are responding by demanding more information on the compensation provided employees hired by their governments. I have heard several counterparts discuss requests made to them by individuals wanting specific information on employee salary and benefit amounts. This follows a trend that has been in place for a little while, as evidenced by the decision last summer by the Nashville Tennessean to post actual salaries for all State of Tennessee employees.

Government employee salary and benefit information is a matter of public record, and when requests are made, local jurisdictions have a moral and ethical obligation to provide honest information to inquiring citizens. As a means of maintaining public trusts by promoting institutional accountability, jurisdictions are and may continue to adopt new practices where employee salary information is made on websites and other sources.

Proactive delivery of this information to a desiring public (i.e., pushing rather than pulling, for those of you in public relations) does provide local governments the opportunity to tailor the message to provide convey the truth with an honest perspective. In North Carolina, jurisdictions can take advantage of the requirements set forth in the NC Transparency Project, an initiative of the right-leaning John Locke Foundation.

The NC Transparency expectation in this area for local governments to provide general employee salary information by job code (or title), as well as for specific employees making $50,000 or more per year. Several jurisdictions, like the City of Concord, achieved compliance with the first part by including pay plan documents that show the pay scales each of their position titles are aligned with.  For positions held by multiple employees, a solution such as this makes the most sense.

Identifying those employees with higher salaries ($50,000 or more) has not been met with the same level of adoption. However, this concept is an appropriate middle ground in order to give citizens the information they are most concerned about (salaries of management and senior positions). In order to apply the proper context, jurisdictions may consider showing comparisons for these positions with state or survey group averages.

Another option of communicating government employee compensation that jurisdictions may want to consider is to examine the distribution of total contribution across job titles, departments, or pay grades. Generally speaking, citizens understand that government employees in high-demand roles (police, fire, public works, and other critical services) need to be paid sufficiently in recognition of their service and in order to avoid losing them to other potential employers. Their concerns, more often than not, are about the compensation levels of management, especially the impact of their higher salaries as it relates to those of direct service providers.

Preparing a graph or other visual aide that shows how total compensation is split across each department, job title, or pay grade should give citizens a better understanding of how their taxes, fees, and other revenue commitments are distributed to achieve and maintain quality services. If citizens see that the lion’s share of jurisdiction salary money is going to police officers, firefighters, and other service positions, rather than administrators, they are likely to be less critical of individual salaries, so long as they are not at unethical levels.

Government has a moral obligation to stand accountable and open with respect to the compensation of its employees. Public inquiry, along with rigorous review by elected officials, provides the best possible defense against unscrupulous behavior that leads to scandal and crises of trust.

ASPA Member Kenneth Hunter is an MPA Graduate of The University of Georgia with more than a decade of experience in local government finance. Kenneth is the Budget & Evaluation Manager for the City of Rocky Mount, North Carolina, and serves on the Executive Committee of theAssociation for Budgeting & Financial Management and is a Board Member and Webmaster for the North Carolina Local Government Budget Association.

By Kenneth Hunter, Guest Blogger

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One thought on “Bell Tolls for Effective Communication of Compensation

  1. Two principles stand out in the fallout at Bell, CA; ethics and transparency. Public officers serve at the mercy of the citizens (appointing stakeholders) who are the tax payers. When performing the city’s duties, these should be carried out to meet expectations of the public at the least exemplifying the social values, respect for the institution(s), and consequences of their choices and beliefs. Thus, as for the public finances and the call for openness, Bell public officials stirred-up a messy controversy by flouting common accepted standards for practicing public service, trust and benevolence. It is a learning opportunity although disgraceful to the practitioners.

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