SHARON
January 04, 2007 05:07 pm
—
The City of Sharon and its municipal government have received substantial attention over the last year as it went through the election of a Home Rule Study Commission, and the completion of the Early Intervention Program Report. This attention to the City's financial condition, its management performance and its governmental structure is badly needed. Sharon, like many established cities in Pennsylvania and around the nation, has experienced significant economic decline during the last thirty years and needs a major change in direction. Having completed one year in office and had six months to review the recommendations of the Early Intervention Study, and having just received the recommendation of the Home Rule Study Committee, it is an appropriate time to inform the residents of Sharon and of the Greater Shenango Valley about the State of the City. The following is a summary, which focuses on the recommendations of the City's Early Intervention Program.
1. Sale of Waste Water Treatment Plant and Collection System
By the end of January, I will recommend to Council that it pass enabling legislation to sell the collection system to Aqua subject to resolution of the following questions:
a. Adequacy of Aqua's proposed price and terms.
b. Effect of the change on sewer rates.
c. Availability of future funding from EPA or DEP.
d. P.U.C. approval of the sale
e. Resolution of issues with the USVWPCA.
2. Police Department Management Reform
a. The City has entered into an agreement to use the regional lockup and will no longer use police clerks as dispatchers with these changes improving safety and saving money.
b. The City has agreed to fund half of the School Crossing Guard Program through the end of the current school year and eliminate all future funding. At a cost of $150,000 per year to the taxpayers of Sharon, a complete analysis of this service is necessary.
c. I have designed a new management system under the police department for a more efficient and effective delivery of code enforcement services to achieve improved tracking of cases and faster response and resolution of incidences.
d. Contract negotiations with the F.O.P. in 2007 must provide necessary fringe benefit savings to move its costs more in line with the private sector. Sharing or contracting out police services are some options that must be considered by the city to achieve a cost structure it can afford. My deadline for this decision is June 30, 2007.
3. Elimination of Shenango Valley Community Library Subsidy
a. The subsidy for 2007 is $120,000, a reduction of $130,000 from 2006.
b. The library board is currently exploring a new organizational structure for more efficient service delivery.
c. I recommend that the community completely re-evaluate the need of all library services given today's technology and determine the most efficient and effective way to provide those services. I encourage cooperation with Penn State University and the public schools in this process with the ultimate goal of a self-sustaining library.
4. Healthcare Cost Savings
a. The City, with the aid of a newly formed healthcare committee consisting of union, non-union, and management, accepted bids from local insurance brokers. (Thank you to Fringe Benefit Services, Inc. and Gilbert's Insurance and Consulting.)
b. Because of a reduction in shock claims and the start of a Health Reimbursement Account Hospitalization Plan coupled with a wellness program the City should realize a 25% savings, or approximately $350,000.
c. Non-uniform and management employees, as part of this new healthcare package, will be subject to a monthly premium, higher co-pays and prescription costs resulting in a savings of approximately $500 per employee.
d. While the firefighters' union has accepted the new healthcare package, it is my intention to get the police union and non-uniform employees union to accept a similar package of cost savings by June 30, 2007 to prevent the City from having to seek less expensive ways to purchase these services.
e. I will move to have healthcare benefits reduced or eliminated for all part-time City employees by the end of March.
f. Beginning immediately, all retired employees will be required to certify annually that alternative healthcare coverage is unavailable to them or to their spouses from other employers.
5. Fire Department Improvements
a. Discussions to move the Sharon firefighters from a 42-hour to a 48-hour workweek and the analysis of utilizing an ambulance service through the Fire Department are ongoing and should conclude by the end of June of 2007. I will seek to change the way the City provides fire service if these cost savings cannot be realized by that deadline.
b. The firefighters union has accepted the new healthcare package saving the city approximately $10,000.
6. Street Department Changes
a. The implementation of a wintertime schedule will effectuate a faster response time for snow removal and help reduce overtime costs by approximately $6,000.
7. Post-Retirement Benefit Savings
a. Council and I agreed to eliminate or adjust some post-retirement benefits for non-uniform employees.
b. I have directed the City's insurance carriers to examine all policies connected to retirees to identify their current and anticipated future costs and to design a benefit program that the City can afford to pay. This project and new agreements need to be in place by June 30, 2007.
c. During 2007, I will address post-retirement benefit costs relative to the City's ability to pay with the three unions representing City employees, seeking appropriate reductions to a level that the City can afford to pay by June 30, 2007.
8. Inter-Governmental Cooperation and Contracting of Services
a. I am currently engaged in discussions with adjoining municipalities seeking more efficient service delivery and cost savings in municipal safety, infrastructure and administrative services. All City operations are open to discussion and proposals for improvement. I expect several cooperative efforts to be in place by the end of June.
9. Labor Cost Savings
a. In response to the Early Intervention Program recommendation of a reduction of eight to twelve employees, while maintaining public safety and service delivery quality:
(1.) I eliminated three positions in 2006 at a savings of $110,000. I will recommend elimination of several more positions in 2007 at an additional savings of at least $72,000 as soon as more efficient operations can be put in place to allow these cuts to occur.
(2.) All positions within the City will be evaluated during 2007 in search for additional cost savings.
10. Office Efficiency and Technology
a. The Commonwealth is assisting the City in evaluation of all computer hardware and software to achieve more efficient information flow, collection and recording of necessary data and assurance for safety to City residents.
b. A new phone system, either purchased or leased, is a priority.
11. Financial Reporting Controls and Forecasts
a. My office designed and implemented a monthly cash flow reporting system beginning in September.
b. Beginning in January, Department Heads and Council will receive monthly financial reports leading to comparison of actual performance against budget with accountability for variances.
c. The City has eliminated many of the financial management shortcomings that existed and is working with our auditors to provide improved reporting on a monthly basis beginning in 2007.
d. In January, I will propose to City Council a new organizational chart for the City that includes a Chief Financial Officer position. This position could be part-time, contracted or volunteer.
12. Use of Outside Expertise
a. Since taking office, I have continually sought professional advice on an informal basis from experienced individuals in the community and the state government. By the end of March, I will formalize this process through creation of the Mayor's Advisory Committee to provide assistance on financial management, human relations and strategic matters.
While it took the City of Sharon many years to decline to its current position, it must quickly seek a change in its direction to achieve the benefits its residents demand and deserve. The Early Intervention Study emphasized the urgency of Sharon's circumstances and its need for change, and that all City employees would have to participate in this change and the financial sacrifices it requires for a true turnaround to occur.
With this report, I have addressed the study's recommended $1 million of reductions with savings of approximately $750,000 and established deadlines - primarily June 30, 2007 - for achievement of these improvements. I am pleased to report that these benefits come with no additional property tax increase to the residents of Sharon and the wage tax remains at 1/2 percent. I intend to submit a report to the community in July on each of these issues. The citizens deserve this accountability.
Let me conclude by thanking the many City employees who are cooperating to achieve these changes and improvements, as well as the members of City Council, the Governor's Center on Local Government Services, the Home Rule Study Commission and the various volunteers who are working on behalf of the City. Many are making sacrifices, and our future holds much promise if we continue to focus on these necessary changes.
Sincerely,
Mayor Robert J. Lucas
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Sharon Mayor Bob Lucas The Herald
