Pacifica urges staff to cut work hours

Encouraging city staff to reduce work hours and providing enticing severance packages is step one in closing a $1.1 million shortfall next year, officials decided this week.

A deficit of $1.1 million hangs over the city’s 2007-08 budget, which is approximately $25 million in total. Interim City Manager Bill Norton said he is looking into freezing positions, reducing employees’ hours and even closing city hall for a week to trim the fat from an already lean budget.

To that end, a so-called voluntary separation program was unanimously approved Monday night by the City Council as the board took its first look at where and how to make cuts.

As with many cities, personnel is the lion’s share of Pacifica’s operating costs. The voluntary separation program allows employees to temporarily reduce work hours by no more than 10 percent. It includes a severance package for people willing to leave for good, which would provide eight weeks of salary and two months of city-subsidized health insurance for those willing to quit or retire by June 29.

Norton acknowledged that if no one takes advantage of the separation program, officials will have to consider layoffs and further cuts.

“We’re just putting it out there and we’ll see who takes advantage of it,” Norton said. “Otherwise, we’ll have to sit down and consider where else we can make cuts.”

The next meeting on the issue takes place tonight, as officials determine more specifically where the axe will fall in all departments. Some other potential revenue for next year includes the sale of some city property on Sweeney Ridge, offering incentives for city employees to retire early, and freezing a handful of positions — which includes one in the engineering department as well as other administrative positions.

Much of the revenue loss came from some reductions in the city’s sewer fund. Norton said that in the past, the city was legally able to transfer funds from this pot as a “payment in lieu of taxes,” or PILOT payment.

The city was charging approximately $700,000 in PILOT fees that went into its General Fund. However, a California Supreme Court ruling in July 2006 found that governments could not mix funds between their general fund and sewer funds, leaving this much-needed revenue stream out of the city’s operating budget.

“It’s pretty doggone grim,” Councilwoman Sue Digre said. “But hopefully people will take advantage of this program as an easy way to leave if they were already thinking about it.”

tramroop@examiner.com

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