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Wednesday, Dec. 5, 2007 | When Dai Nguyen lost his job as a mechanical engineer in the Water Department earlier this year, he became the first — and only — employee to be ousted from the city of San Diego in the wake of the job cuts Mayor Jerry Sanders promised for this year.
That’s because all but 82 of the approximately 300 employees that Sanders wanted to lay off as part of this year’s budget fled their jobs to others in the city or left altogether in the weeks leading up the to the beginning of this current year.
And of those 82 employees whose jobs were ultimately eliminated by Sanders when the budget year began in July, 79 of them have gone onto to fill other jobs within the San Diego city government. Some of them even got raises. That left Nguyen and two others. Those two employees retired — Nguyen left city service.
The layoffs result from the city’s effort to tighten its belt while it tries to scrape together funding for mounting pension, retiree health care and infrastructure expenses.
But the departure of one out of 82 displaced workers — an amount gleaned from the Personnel Department’s records — illustrates the reality of a common management practice at City Hall, in which the city stockpiles money to pay for many roster spots that are not filled with employees. It’s an exercise that plays into the mayor and council’s tussle over the city’s purse strings as well as the debate over whether the layoffs Sanders slated for this year will impact the levels of service the city provides.
Sanders tried to allay the fears of residents by promising that the hundreds of layoffs he wanted to make this year wouldn’t affect the services residents receive. The loss of a handful of employees is less likely to impact the municipal programs Sanders oversees than the exile of 300 that Sanders aides originally predicted during the budget’s creation in the spring.
The phenomenon, in which an overwhelming number of employees hopscotched to other positions when their jobs were cut, also signals that an abundance of the positions the council agrees to fund are going unworked at the city of San Diego.
“It shows there were too many positions budgeted.” said Penne Takade, deputy director of the council’s independent budget analyst. “We need to get rid of them if they’re never going to be used.”
Because the city leaves numerous positions unfilled, it can save money throughout the year by keeping money set aside for the positions without having to pay employees who work them. At any given time, hundreds of positions are vacant, the Mayor’s Office estimates. Sanders said he spent $12.5 million less than he budgeted for last year, a feat he accomplished in part by keeping vacant positions on the city’s rolls.
But the empty positions have also offered refuge to employees who would otherwise be looking for a job elsewhere, as civil service rules allow them to sign on to other parts of the city government when the mayor cut their jobs. If a “laid off” employee is qualified for a city job that isn’t currently filled, they are entitled to take it if they like.
For 14 of the 79 employees who took other jobs in the city, their new position included a demotion. A utility supervisor in the Environmental Services Department took a job as a heavy truck driver. A power plant operator in the Metropolitan Wastewater Department became an electrician. The manager of a hazardous material program was demoted to the title of “senior chemist.”
A demotion wasn’t in the cards for the Nguyen, who decided to depart rather than accept the decrease in pay, said Judie Italiano, general manager of the city’s white-collar workers’ union that he belonged to.
“Everybody had options to demote down, but whether families could afford that as an option is another matter,” she said. Nguyen was unavailable for comment.
Regardless of whether a position Sanders cuts is filled by a worker or empty, its elimination from the city’s annual budget frees up money that can be spent on other areas of the city. In the current budget, the mayor shaved 629 positions from the 11,000-employee roster from a year earlier.
Layoffs were key to Sanders’ financial plan, which was designed to fortify the city’s finances and attack its giant pension costs. But if employees don’t leave city service, their pensions continue to accrue. Removing employees from the city workforce would also stop the clocks that set the size of their pension checks, as a worker’s future retirement income is tied directly to the length of time he or she is employed by the city.
The impact of having only three workers halt their service as a result of Sanders’ management decisions will be minimal in comparison to the billion-dollar pension challenge that Sanders said he would slay.
“What was committed to the public is that the mayor would address the pension deficit and find efficiencies in government,” San Diego County Taxpayers Association president Lani Lutar said. “What we haven’t seen yet is whether he’s going to make the tough choices to lay people off rather than transferring people, because that would have a more positive impact on the pension fund.”
Even demotions don’t help Sanders’ effort to cut its pension obligation, because an employee’s retirement pay is based on his or her highest one-year salary. Even if a worker’s pay drops from $50,000 to $45,000 because of a demotion, the employee will continue to accrue pension credit based on the higher $50,000 figure.
For some workers, the layoffs came as a boon. Joan Raymond, president of the city’s blue-collar union, said about a half-dozen of the 26 utility workers that were forced to transfer from the sewer agency to the Water Department now earn more money because of the switch.
With another 250 position cuts slated for next year, the Mayor’s Office contends the opportunities for employees to jump to another spot on the city of San Diego’s roster are going to dwindle.
“As we continue to decrease positions, there will be less vacancies for people to move into,” Sanders spokesman Fred Sainz said.
Sainz maintains that reduction of positions in the budget — and not the amount of actual employees — is the more important factor in saving money.
“The number of people who are physically laid off is largely a footnote,” he said.