Garden City Budget News
The largest cost in the Village budget is labor. Beyond salaries, the cost of employee benefits is an integral part of Village's labor costs. The total costs of employee benefits have risen from $2.9 million in 1998 to $8.3 million in 2008, growing at an annual compounded growth rate of 11%.
Village employees' statutory benefits include social security taxes, retirement fund contributions, medical insurance and unemployment insurance.
Employees also receive contractual vacation and sick time benefits. After 5 years of service, vacation time equals: 5.5 weeks for fire and police employees; 3 weeks for Civil Service staff, increasing to 4 weeks after 10 years. Village management's vacation is 5 weeks after 5 years and 6 weeks after 10 years. If not used, employees accrue the value of the unused days; the credit is carried forward for use in the future or paid in a lump sum on termination of employment.
Generally, employees are entitled to a percentage of their sick leave and all accrued vacation time upon termination. Members of the Village's police force are also entitled to receive terminal leave and sick leave when they retire or become disabled. All these categories are classified as Compensated Absences. These one-time, cash payments are due the employees, upon their termination of employment, in addition to pension benefits and life-time medical insurance coverage.
As of May 31, 2008 the Village's total liability for Compensated Absences was $7.4 million. Of this total, one member of Village management is owed over $450,000; the next four highest balances average $200,000 per person. The five individuals with the largest balances are owed a total in excess of $1.25 million.
These practices and amounts are contractual obligations. Non-union members of Village management generally benefit from increases won by collective bargaining units; there is a "parity principle" in effect in respect to their own compensation. Residents should discuss with their Trustees the reasonableness of these benefits as a component of total remuneration employees receive including Village funded defined benefit pensions and full indemnity health insurance.
Roy S. Ryniker is President of the Reorganization Alternatives Group, Ltd. (Roy.Ryniker@ReAltGroup.com). .Bob Sundius is a corporate executive and financial advisor for middle market companies (rwsundius@interim-exec-mgmt.com). Both are Garden City residents.
