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City bosses owed $1 million for vacations and sick leave

(Week of February 24, 2011)

If  Vero’s 12 city government department heads all were to retire this year, the city would have to pay them more than $1 million for saved up sick leave and vacation time that should have been used in years past.

While it seems highly unlikely all or even most will soon retire (several have not reached retirement age), the potential liability shows the magnitude of a problem that has finally – as a result of recent high-profile staff departures -- burst onto the radar screen of the new City Council.

“This is obviously an abuse that any taxpayer should be paying these benefits,” said an outraged Vice Mayor Pilar Turner. “They were taken away by corporations 20 to 30 years ago.”

Turner worked in a supervisory capacity for large corporations for 20 years and said she and her employees worked under a “use it or lose it” system. She said it’s high time for the City of Vero Beach to follow suit in the face of its current budget constraints.

How can city department heads all  be accumulating so much sick leave and vacation time?  Don’t any actually get sick, or take vacations?

The stark difference between the private sector and employment with the City of Vero Beach seems to begin from the hire date.

Where many private businesses do not award vacation time until after one solid year of employment, city staffers start receiving vacation time after six months and are eligible to take it immediately. Upon request, employees may take up to three days leave time in advance prior to that six-month benchmark, even during their 90-day probationary period.

City staffers get 10 days per year for the first five years, then it bumps up to 15 days for the next five years. One extra day is added per year of service from years 11 through 20 until the employee has a full five weeks of vacation time after 25 years.

“It is the intent of these rules to have employees take their annual leave time during the year in which it was earned. However, employees carrying unused annual leave shall be afforded the opportunity to use the accrual within the next anniversary year.”

In practice, there is a 60-day limit on accrued vacation days that can be carried over.

Upon retirement or resignation, employees can get a lump-sum payment for up to 60 accrued days of vacation time. In addition, if they retire or resign, they can get 120 days’ pay for “medical leave.” This pay, if all 12 department heads resigned this year and used the leave they have accumulated, would total $590,000.

To date, the value of accrued vacation time owed to just the department heads is $275,000. Combined with the “medical leave” time, the total becomes $865,000.

If you add on the banked time City Attorney Charlie Vitunac is hoping to be paid for if he ultimately is allowed to resign, the total would be $957,000.

According to public records, the city has already paid out $85,000 in banked sick and medical leave time since last Oct. 1, much of that to retired City Manager Jim Gabbard, tipping the potential liability this year well over $1 million.

And that’s just for bosses. Pursuant to a records request, the city provided Vero Beach 32963 with a list of all city employees with 25 years of service or more. That list contained the names of 63 people with hire dates going back to October 1970. That’s roughly 15 percent of the city’s total work force of 450.

Of those 63 employees, three -- Police Chief Don Dappen (34 years), City Clerk Tammy Vock (26 years) and now-retired but rehired Finance Director Steve Maillet (26 years) -- head up departments. Of the other 60 employees, 38 work for the city’s utilities -- 14 for electric, 21 for water-sewer and three for customer service, which serves all the utilities.

Since the city, except for the police,  has no written performance reviews, these long-term employees have received generous benefits and across-the-board pay raises for decades without being evaluated for the service they’re providing to city taxpayers and ratepayers.

With long-term employees banking 11 or 12 weeks of vacation time and in some cases more than one year’s worth of sick time, it raises the question of whether or not anyone in the city actually documents  a sick or vacation day when they’re not at work.

In response to a request for totals of sick and vacation time actually taken and paid out the past five years, the City of Vero Beach Finance Department provided 14 pages of general ledger printouts listing various accounts in 8-point type with no department information or years listed on the pages.

On every fourth page or so, a hand-written year appears at the top.  This is typical of the city’s efforts to deter anyone seeking meaningful data -- especially as it relates to employee pay and benefits – from determining what really is happening.

As best as can be discerned from this disparate data, so far this year, the city has paid out $838,000 in sick and vacation leave to active city employees. The average employee has taken 4.5 days of sick time and 6.5 days of vacation time since Oct. 1.

Last fiscal year, the city paid out more than $2.6 million in sick and vacation time to its 450 employees.

The city’s most recent Comprehensive Audited Financial Report for the 2008-2009 fiscal year ending Sept. 30, 2009 lists $3.1 million in accrued compensated time.

If left unchecked, this liability could mushroom with employees using unpaid furlough days for time off in place of taking sick, vacation or personal time.

Other types of leave accounted for separately are jury duty leave, bereavement leave, family sick leave, military leave and sick leave under the Family Medical Leave Act provisions.

Holiday pay is another category, costing the city more than $1 million last fiscal year.

Vice Mayor Pilar Turner said she’s proposing an overhaul of the city’s policies in regard to the banking of sick and vacation time. She is working with the legal staff to draft a resolution which should appear on the March 1 Vero Beach City Council agenda.

“What I would propose is for the sick leave, it’s use it or lose it, and for vacation time that employees be allowed to carry over one week with written approval of the City Manager,” Turner said.

“And three years to use any accrued vacation that they currently have or they lose it.”

Turner has been working to get a handle on what procedures the City Council needs to follow to curb this problem and stop the bleeding.

“From what I understand, we can pass a policy, but then it needs to be negotiated with the unions so it covers the union employees as well,” she said.

Between the Coastal Police Benevolent Association and the Teamsters Local 769, about 275 of the city’s 450 full-time employees are covered under some collective bargaining agreement. Management employees, such as the department heads who appear to have so much time banked, are not covered by union restrictions.

Councilman Brian Heady has also pulled various records regarding the city’s liabilities and expenses for employee benefits and he’s determined to do something about it.

“I just think that the party’s over and that this council needs to do the responsible thing and pay for the benefits in the year that they’re earned,” Heady said.

“We can’t continue to accumulate millions of dollars on some future council’s budget,” Heady said. “And I think that’s pretty much political suicide so I don’t think I have to worry about November. But it’s also the fiscally responsible thing to do and it needs to be done.”

Heady said he does not fear a mass exodus of city employees due to a change in policy, because the security and quality of jobs at the city are still favorable compared to what’s available in today’s job market with double-digit unemployment.

“The City of Vero Beach is still a very good place to work,” he said.