.comment-link {margin-left:.6em;}

Inside the Beaver's Dam

The Dam Insider is keeping an eye out for you, tracking the elected leaders of Beaver Dam, Dodge County, Wisconsin and beyond. Email your thoughts or tips. Emails may be published unless otherwise requested. Requests will be honored.

Name:
Location: Beaver Dam, Wisconsin, United States

Monday, August 28, 2006

A speedbump no more

1st Ward Beaver Dam Alderman Warren Beske's resignation is a welcome development for those wishing to hold upward spiraling costs in check.

Beske was a dedicated representative of the organized labor segment of his ward. He was always quick to criticize any idea or action that the city's labor unions disagreed with. In his parting letter to the city, Beske makes clear his lack of understanding of the real public finance problems facing local government:

I feel that Beaver Dam will continue to lose more and more services and never see a reduction on property taxes for the services lost. Also, by losing wage and salary employees through retirement and resignation, and not replacing them, the city will not be able to maintain the quality of services that the citizens desire and pay for.

Beaver Dam, like most municipalities, is saddled with largely inefficient operations given employee compensation costs. Generally speaking, there are two fixes to this solution:

1. Hold compensation increases (including the present and future cost of benefits - The Police and Fire Commissio's recent decisions have not helped) in line with inflation.

2. Streamline operations through consolidation of departments, personnel and municipal services; fiscally responsible outsourcing; and increased employee productivity (often encouraged through "retirement attrition").

General laborers for the city will take their shots at these ideas (like Beske has through the years), but like Beske, few of them have the formal management, finance or economics training necessary to make sound "dollars and cents" decisions.

Wednesday, August 09, 2006

Pensions DOA

Hey labor unions, listen up:

There are ample reasons to lament the demise of pensions - days when one could work at the same job for life and leave with a tidy nest egg - but it's been clear for a while now that those days are gone. The new era requires personal responsibility for retirement.

- Milwaukee Journal Sentinel Editorial

PFC Decision Only Adds to City's Troubles

Last week's decision by the Beaver Dam Police and Fire Commission to uphold a grievance filed by a retiring police officer could lead to millions of dollars in payouts to future retirees.
The decision to side with the police union, another in a string of anti-taxpayer moves by the PFC, may sets a precedent that upholds an agreement reached 10 years ago to pay 25% of a retiree's health insurance premium until that individual is Medicare eligible. That agreement, however, was intended to last only five years, until a reduced pay scale for new hires expired. At least that's what Mayor Jack Hankes, the city's labor attorney, and a high ranking veteran city employee believe. The union disagrees.
City retirees are already able to bank sick days in exchange for health insurance premium payments. This benefit, now upheld by the nearly unaccountable PFC, will cost the city hundreds of thousands of dollars a year, and that number could skyrocket with large increases in the cost of health insurance. According to figures compiled by the city, if insurance costs continue to climb, officers who are currently in their mid-20's will stand to receive more than $700,000 upon retirement.
And then came last night's announcement by Finance Committee Chairman Jon Litscher that health insurance costs will likely rise nearly $230,000 next year, devouring any possible increase in tax revenue.
The decision by the PFC has set the city back hundreds of thousands of dollars a year. It's time the Commission starts considering the needs of taxpayers over the needs of employee unions, not the other way around.