REPORT TO COUNCIL
SUBJECT
Title
Action related to the Elected Police Chief’s Benefit Request
Report
BACKGROUND
On March 20, 2018, the Council approved the Police Chief’s request for retroactive pay increases (Council Agenda item 18-333). The action was based on the Police Chief’s written request for a salary increase and, as a result, Council action was taken on salary and POST pay. The March 20 Council action formalized approval for retroactive payments made without required City Council authority.
While implementing the Council approved salary increase for the Police Chief, it was discovered that staff had adjusted certain benefit increases for the Police Chief in alignment with the Unit 9A - Unclassified Police Management Memorandum of Understanding (MOU) that had not been approved by Council. Having learned this, City staff has confirmed with the Police Chief he is also seeking additional benefits commensurate with Unit 9A.
Unfortunately, during the drafting of the March 20, 2018 City Council report, these unauthorized benefit increases had not been disclosed to the City Manager nor explicitly requested by the Police Chief’s written request for salary and benefits adjustments (see Attachment 1), resulting in the March 20, 2018 City Council report not including that information. To remedy this issue, the City Manager has conferred with the Police Chief who confirmed in writing an interest in continuing to receive these increased benefits--equal to Unit 9A (Attachment 2). Additional City Council approval is required to consider these increased benefits.
As discussed in the March 20 report, the Chief of Police has historically received the same benefits as provided to Unit 9A. The 2016-18 Unit 9A MOU (Attachment 3) includes the following benefits: retirement, holiday pay, vacation pay, uniform allowance, insurance (life, medical, dental, vision), retiree medical reimbursement, sick leave, family leave, personal leave, bereavement leave, voluntary time off, Voluntary Employee Beneficiary Association (VEBA), auto allowance, smart phone stipend, stadium detail, management leave (increased from 80 hours per year to 120), emergency paid leave pool, alternative work schedule, flexible spending plan, and employee assistance program.
DISCUSSION
Council’s March 20, 2018 action was to retroactively approve the Chief’s pay increases for the period December 18, 2016 to April 13, 2018. For the benefit request, the Chief requests that he receive the same benefits package as provided to Unit 9A in the 2016-18 MOU.
Health, Dental and Vision Insurance Benefits:
In the City’s Human Resources system, the Police Chief’s benefits were linked to Unit 9A’s benefits package. In the 2016-2018 Unit 9A MOU, the City agreed to pay more for the health-related allocations, an “enhanced” benefit: health increased from $848.94 per month to $984.94 per month; new dental coverage of $21.57 per month and new vision coverage of $9.02 per month. Chief Sellers received the enhanced health allocation following Council approval of the Unit 9A MOU. He received this benefit for the months of April through July 2017, when it was suspended per direction of the then Human Resources Director. To separate Chief Sellers from the rest of Unit 9A, staff was directed to manually override the benefit to the lower amount until further notice resulting in a suspension of enhanced benefits. For November and December 2017, this manual override was not performed by staff and the Police Chief received dental and vision benefits for those two months. The shaded boxes below illustrate the months in which Chief Sellers received the enhanced health benefit for 2017 and the total benefit overpayment amount.
Health Benefits Awarded to Police Chief, 2017:
|
|
1/17 |
2/17 |
3/17 |
4/17 |
5/17 |
6/17 |
7/17 |
8/17 |
9/17 |
10/17 |
11/17 |
12/17 |
Total Benefit Overpay |
|
|
|
Health |
848.94 |
848.94 |
848.94 |
948.94 |
948.94 |
948.94 |
948.94 |
848.94 |
848.94 |
848.94 |
848.94 |
848.94 |
$400.00 |
|
|
|
Dental |
0 |
0 |
0 |
21.57 |
21.57 |
21.57 |
21.57 |
0 |
0 |
0 |
21.57 |
21.57 |
$129.42 |
|
|
|
Vision |
0 |
0 |
0 |
9.02 |
9.02 |
9.02 |
9.02 |
0 |
0 |
0 |
9.02 |
9.02 |
$54.12 |
|
|
Unit 9A’s health allocation changed in January 2018. Since the manual override was not implemented, Chief Sellers received enhanced 2018 health benefits. The shaded boxes below illustrate the months in which Chief Sellers received the enhanced health benefit for 2018 and the total benefit overpayment amount.
Health Benefits Awarded to Police Chief, 2018:
|
|
2018 |
|
|
|
|
|
|
Jan |
Feb |
Mar |
Apr |
May |
Total Benefit Overpay |
|
|
Health |
982.43 |
982.43 |
982.43 |
848.94 |
848.94 |
$ 400.47 |
|
|
Dental |
Delta Premium Holiday |
22.22 |
22.22 |
0 |
0 |
$ 44.44 |
|
|
Vision |
9.02 |
9.02 |
9.02 |
0 |
0 |
$ 27.06 |
|
|
|
|
|
|
$ 471.97 |
|
Please note that Chief Sellers did not receive the enhanced health benefits during April 2018. Further, due to pay-periods in the month of May it is expected that increased health benefits will be implemented by early June.
Had staff implemented a separate benefits group for the Police Chief classification versus tying his benefits to Unit 9A in the PeopleSoft HR/Payroll system, he would not have received these enhanced health benefits. This resulted in increased health benefits valued at $1,055.51 ($583.54 for calendar year 2017 and 471.97 for the first three months of 2018). It is important to note that at the March 20 Council agenda presentation, $522 of overpayment was included in the description of the total amount of additional retroactive pay awarded to the Police Chief. Unfortunately, information for retroactive health benefits was only disclosed for the early months in 2017 and no information for FY 2017-2018 enhanced benefits was provided to the City Manager during drafting the prior memo. However, if Council approves aligning the Police Chief’s benefits to Unit 9A, the benefits would be retroactive to April 2017 when they became effective for Unit 9A. If approved, the City will owe the Police Chief $ 921.93.
Paid Leaves:
Another enhanced benefit in the Unit 9A MOU was an award of an additional 40 hours of management leave for a total of 120 hours per year. The Police Chief was awarded 80 hours of management leave on January 1, 2017, and was credited with Unit 9A’s additional 40 hours on March 26, 2017. He used the following paid leaves from January 1, 2017 to April 21 2018. He has not received the additional 40 hours of Management Leave on January 1, 2018 per the current Unit 9A MOU.
|
Leave Type |
2017 Total Hours Used |
2018 Total Hours Used |
|
Unclassified CTO |
0 |
0 |
|
Sick Leave |
0 |
0 |
|
Family Sick |
8 |
0 |
|
Management Leave |
120 |
16 |
|
Vacation |
142 |
40 |
Typically, elected law enforcement officials receive health and retirement benefits, but not paid leaves. For example, the County of Santa Clara provides health, dental, life insurance benefits, and retirement, but does not provide any vacation, management, and sick leave accruals for its elected officials. Generally, elected officials assume office with a stated pay rate but without the ability to accrue paid time and no ability to be paid out unused time accrued on leaving office.
Other 9A Benefits without a Fiscal Impact:
Unit 9A also receives other non-salary related benefits which do not have a fiscal impact (i.e., employee assistance program, retiree medical reimbursement program, deferred compensation, flexible spending account) or were not enhanced in the 2016-18 Unit 9A MOU (i.e., retirement formula, holidays, life insurance, cell phone stipend).
Benefit Controls Moving Forward:
Both the Interim Human Resource Director and Director of Finance are actively analyzing existing practices and working closely with the City Manager and Chief Operating Officer to improve practices and ensure quality controls of the City’s PeopleSoft HR/Payroll system. As noted by the external auditor as part of City’s Comprehensive Annual Financial Report (CAFR) annual audit, this matter is also being monitored by the City’s external auditor and the City Manager recently conferred with them regarding the discovery of these actions. This matter is extremely important and these past actions, and lack of full disclosure of them, are being handled with a high level of importance.
ENVIRONMENTAL REVIEW
The action being considered does not constitute a “project” within the meaning of the California Environmental Quality Act (CEQA) pursuant to CEQA Guidelines section 15378(b)(5) in that it is a governmental organizational or administrative activity that will not result in direct or indirect changes in the environment.
FISCAL IMPACT
If the Unit 9A MOU enhanced benefits are applied to the Police Chief the total cost for the entire two-year MOU period is approximately $3,519.20 for medical/dental/vision and $12,065 for the 80 additional hours of Management Leave. As indicated above, $1,055.51 in medical/dental/vision coverage has already been paid to the Police Chief in error and the Chief used 120 hours of Management Leave in the 2017 calendar year. The impact to the current budget is minimal.
COORDINATION
This report has been coordinated with the Finance Department and City Attorney’s Office.
PUBLIC CONTACT
Public contact was made by posting the Council agenda on the City’s official-notice bulletin board outside City Hall Council Chambers. A complete agenda packet is available on the City’s website and in the City Clerk’s Office at least 72 hours prior to a Regular Meeting and 24 hours prior to a Special Meeting. A hard copy of any agenda report may be requested by contacting the City Clerk’s Office at (408) 615-2220, email clerk@santaclaraca.gov <mailto:clerk@santaclaraca.gov> or at the public information desk at any City of Santa Clara public library.
Alternatives
1. Approve benefits for the Police Chief equivalent to the Unit 9A 2016-18 MOU effective May 8, 2018.
2. Approve retroactive benefits for the Police Chief equivalent to the Unit 9A 2016-18 MOU for the period December 18, 2016 through May 7, 2018.
3. Approve retroactive benefits for the Police Chief equivalent to the Unit 9A 2016-18 MOU for the period December 18, 2016 through May 7, 2018, and moving forward from May 8, 2018, for the duration of the 2016-18 MOU.
4. Other action as proposed by the City Council.
RECOMMENDATION
Recommendation
The City Manager has no recommendation. However, if the City Council desires to make the Chief of Police’s benefits track Unit 9A benefits, the following should be approved: Alternative #3 - Approve retroactive benefits for the Police Chief equivalent to the Unit 9A 2016-18 MOU for the period December 18, 2016 through May 7, 2018, and moving forward from May 8, 2018, for the duration of the 2016-18 MOU.
Staff
Reviewed by: Julia Hill, Interim Director of Human Resources
Approved by: Deanna J. Santana, City Manager
ATTACHMENTS
1. Written request from Police Chief Sellers, dated March 16, 2018
2. Written request from Police Chief Sellers, dated March 29, 2018
3. Unit 9A Memorandum of Understanding, December 18, 2016-December 22, 2018
4. Benefits Applied to Police Chief, 2017-2018