Is overtime in Long Beach out of control?

Following a cash-flow shortfall that prompted the city to borrow $4.5 million to pay its workers, outgoing police officials and retirees, several city departments have exceeded their overtime budgets and temporary employee salary lines for the year — in some cases by more than 100 percent — in what some Democrats are calling “out of control” spending. The trend has put the city on track to run up a budgetary deficit by early next year.

According to a Dec. 9 internal memo from Comptroller Sandra Clarson to City Manager Charles Theofan, obtained by the Herald on Monday, six months into the current fiscal year, overtime has skyrocketed across six departments, including Beach Maintenance, Sanitation and the Police Department.

Overtime in the Beach Maintenance Department, for example, more than doubled the budgeted total of $150,000, climbing to $310,469, while the $307,000 in overtime expenses in the Sanitation Department exceeded its earmarked amount by more than $129,000. Police overtime, according to the memo, was $24,000 above its budget of $750,000 for the year.

The “unforeseen” overtime costs that the city was forced to contend with in the aftermath of Tropical Storm Irene were cited as one of the main reasons for last month’s cash-flow shortfall that led to an emergency City Council meeting on Nov. 30. The city issued a $1.7 million tax anticipation note to make payroll by Dec. 23 and borrowed $2.5 million through a budget note to meet contractual obligations for outgoing police officials and retirees.

In her memo, Clarson urged Theofan to meet with department heads to discuss ways to decrease overtime and part-time hiring. While the memo makes clear that overtime is soaring in Long Beach, Theofan dismissed claims of fiscal mismanagement and said that the document doesn’t take into account a number of factors that led to the increases, nor does it mention that, in some cases, the city has already been reimbursed for some of the overtime costs.

Theofan attributed the bulk of the overtime to Irene, along with September’s Quiksilver Pro New York event and a number of other factors. Still, he said, the Federal Emergency Management Agency is expected to reimburse the city more than $1 million for the costs associated with Irene early next year, and Quiksilver has already repaid the city for overtime costs incurred during the surfing contest.

In October, city officials said that Quiksilver reimbursed the city $124,924 for police services and overtime, beach maintenance, sanitation and other services. Police services totaled $79,244, sanitation fees, $9,000, and fire and emergency services, $5,880. Quiksilver also shelled out more than $17,000 for lifeguard costs between Sept. 6 and 10.

“There were circumstances throughout the year … that caused the overtime to exceed,” Theofan said. “A significant amount of police overtime and beach maintenance was also reimbursed by Quiksilver. Similarly, we’re going to get a reimbursement from FEMA. What that [memo] doesn’t give you … is how much of that was reimbursed already to the city and what is going to be reimbursed. The reality is that your mud-slingers will accentuate the negatives and not give the full picture.”

Democratic City Councilman Mike Fagen, however, claims that the administration knew that projected revenue would come up short this year, but it continued to hire, give employees raises and ultimately failed to rein in overtime.

“There have been no controls and no breaks in spending,” Fagen said. “They were warned by the comptroller back in April that the revenues were coming in slow, and they went ahead and gave out grade changes and raises after the storm.”

In her memo, Clarson also pointed out that the Public Works, Recreation and Building Departments’ temporary salary lines are currently overdrawn, mainly due to seasonal hires that work for the city in the spring, summer and fall.

For example, temporary salaries in the Building Department jumped $2,667 from the allocated $5,000 for the year, while the money earmarked for temporary employees in the Public Works Department swelled from the budgeted $5,000 to $7,706.

Last week, the Herald reported that an independent auditor is evaluating the city’s finances for the last fiscal year and that a report, due sometime this month, is expected to show a deficit.

Clarson said that overtime should be stopped “immediately” to all outside departments not only because funds are not available, but also because it would “only add to the expected deficit.”

“The main concern here is the Recreation Department,” Clarson wrote. “There are no budgeted monies for part-time, temporary employees. They are over-expended as of today, and with six months remaining, this is a major concern.”

Clarson said that according to a memo Theofan wrote on Nov. 16, “seasonal part time employees should be dismissed. That should ease the burden, though that will not be reflected until the next timesheet or payroll.”

Fagen said that keeping the seasonal workers on until November illustrated what he called fiscal “mismanagement.” He added that the seasonal work force is typically let go in September.

“They’re not supposed to be working more than 20 hours per week,” he said. “That’s why the Rec has exceeded their temp lines.”

Theofan said that about 50 seasonal employees — temporary workers who earn between $8 and $12 per hour and do not receive benefits — were recently let go, but he insisted that those employees usually save the city money.

“Seasonal employees are a way to save the city money because there is a certain amount of work that needs to be done during the spring, summer and fall … if you didn’t have the seasonal workers, you would need more full-time employees,” Theofan said.

He added that the overtime has decreased in recent months. “We have decreased overtime as the months have gone by,” he said. “We did hire more paid firemen, and it should bring down the overtime costs because it covers sufficient manpower, so you won’t have overtime.”

Fagen said that he is confident that a new Democratic administration will be able to pick up where the current administration has left off and reach an agreement with department heads to curb overtime spending next year.

“We’re confident that the unions and the work force are going to work closely with us to come to a working plan that will put the city back on the road to fiscal stability,” he said.