We are at a critical time in the city of Hollister, and it is a
time for hard choices. Most people in the community are aware that
we have financial problems, and probably have a lot of questions
and concerns. I will try to provide the community with some
answers, and with an expectation for when there will be more
answers. This situation is hard for everyone
– our city employees and their families, the city manager and
department heads, the city council, and all of the people of
Hollister. Difficult times demand strong leadership, and as the
Mayor, I feel like it is my responsibility to address the
community, to take responsibility, and most important
ly, to provide the strong leadership that is needed. I must
admit, I have never had to deal with a challenge quite like this,
and I am still learning every day.
We are at a critical time in the city of Hollister, and it is a time for hard choices. Most people in the community are aware that we have financial problems, and probably have a lot of questions and concerns. I will try to provide the community with some answers, and with an expectation for when there will be more answers. This situation is hard for everyone – our city employees and their families, the city manager and department heads, the city council, and all of the people of Hollister. Difficult times demand strong leadership, and as the Mayor, I feel like it is my responsibility to address the community, to take responsibility, and most importantly, to provide the strong leadership that is needed. I must admit, I have never had to deal with a challenge quite like this, and I am still learning every day. While this job can sometimes be a lot more than I bargained for, I am still very grateful to the community for your trust, and the opportunity to serve. I can assure you that I am working extremely hard (in fact to the detriment of my own career) as are all of my fellow council members and the city leaders. Often, the public is left to make assumptions about what we are doing and why, because we can’t, or don’t disclose the reasons. While there are some limits on what I can say, I will do my best to share with everyone what we are doing, and most importantly, why.
The best place to begin, is how did we get into such financial difficulties? I’ll start with taking responsibility. I truly wish that I had anticipated our financial future better. This is the first year we have done a 5 year trend analysis (thanks to our city manager Shaddox), so that we could better prepare for the future. While this forecast tells of doom and gloom, we are in a better place to fix the problems. For the first two years I have been on council, we thought we had a balanced budget, and we had very healthy reserves. While we were spending money from our reserves, it was money well spent. A new fire engine, and road repairs, are examples of some capital and infrastructure improvements that were made with those dollars. We still have $9 million in reserves today, which is about twice the amount we need, to have a financially responsible cushion. While spending down some of our reserves has been repeatedly mentioned in the papers, the real problem was that we thought our financial situation was rosey, and that the future would be fine too. While we knew the sewer moratorium would hurt us financially, the impact has been greater than anticipated. We also agreed to significant raises and improvements in retirement benefits for our police and fire fighters. We did this, in large part because we wanted to put a stop to years of high turnover, and unfilled positions. Those increases are going to be hitting us hard in the coming years. All non-public safety employees had a contract with significant raises in the past few years as well, and the salary costs are going to continue to escalate. Let me be clear – these raises are well deserved, and at the same time, they are hard to afford. We have also increased staffing in the past number of years, especially in police and fire, and starting this July, we will be losing funding from the Federal Government under the discontinued C.O.P.S. program. There are many other factors that will hurt us financially. The rapid growth of the 90s, where the city didn’t charge enough in impact fees will continue to cost this community for many years to come. We are currently taking the steps necessary to raise those fees that the developers pay, so that when the building moratorium is lifted we will be able to make sure that all new growth pays it’s fair share. In the past 3 years, our workers compensation insurance, health insurance, and retirement plan costs have increased dramatically. We anticipate that they will continue to climb for the foreseeable future. Our State’s financial problems have led them to take our money, and we are very concerned that the State will take even more in the coming years. The Governor’s recent proposal would take an additional $1.3 billion from cities. While we hope the economy picks up quickly, the downturn has hurt us, and we need to not be overly optimistic about the State’s future. I expect at least another 3 to 4 years of difficulty for California at a minimum. The bottom line – we have lots of money right now ($9 million in reserves), but our costs have soared, and our revenues have stayed flat. Potentially, most threatening to our financial solvency, is a great risk of the State taking a lot more of our money. We must correct this, and the sooner we do, the more capable we are of dealing with it. We cannot afford to wait, and pretend that all is ok. It might help us get re-elected this year, if we didn’t admit to this problem now, just like the State did in 2002. But, we must be proactive, and take this challenge head on today. In addition to working for the citizens of Hollister, I have also taken a leadership role (immediate past President of Monterey Bay Division) in the League of California Cities. The League’s primary focus is to protect all of the cities of California from the State stealing our communities’ money. In November, we will bring forth a ballot measure that would require the State to get permission from the citizens, before they could take any more of our money. I sincerely hope everyone in Hollister will look back to these times, and support this ballot measure.
The next important question – why cut 36 positions? Our financial trend analysis is not a perfect science, and we are working on it daily, as we get new information. Even with our most optimistic projections (I would prefer using conservative ones), if we don’t cut our costs by about $2 million a year, we will go bankrupt in about 3 years. While cuts are certainly not the only solution, they are an option that most cities and counties are looking at doing across California right now. Even with cutting the 36 proposed positions, the city is still looking at bankruptcy within 6 years. While there are other options to reduce costs, we expect that we will need to implement many of those in addition to, and not in lieu of the 36 positions. Many employees have come before us, and asked that we consider alternatives. I can assure you that we have both a legal and a moral obligation to do so, and we intend to start that process as soon as we have made a decision on the reduction in force. Many have asked, “why not wait to make the cuts?” It is very important that we first make a decision as a council on where we need to be financially, and how much we need to reduce our expenses. Then, we can go through a process called “meet and confer” which again, is required by law. The union has a lot of power to determine working conditions, wages, duties, etc. The city council has the sole authority, and responsibility for making decisions to protect the financial viability of our city. We can’t make employees take pay cuts, or reduced work hours, but we can reduce the number of positions in order to keep our city from going bankrupt. As much as every one of us respects and appreciates our city employees, we have a duty to the community as a whole, above all else.
One potential solution to our financial challenge is to raise our revenues. We are currently doing a comprehensive review of all of our fees and charges, to make sure they are appropriate. I also would like to remind everyone of the importance of shopping local. Every time we buy something out of town, we give our hard earned money to another community, so that they have more money for their parks, and roads, police and fire. This is money that could help our community. You would also help to create jobs here in our community, and most all of our businesses also support many local charities and programs. Please, put your money to work here in Hollister – make every effort to shop here! We also are working to bring more retailers to Hollister. I have personally been calling on Barnes and Noble and Borders Bookstores recently. I also have reached out to local businesses, encouraging them to expand, and offer more for the community. We have a lot of work to do in this area in the coming years. We also have been pursuing grants, but it has been very difficult, even with the help of a contracted specialist. We will continue to pursue grants, as they become available. Another area with a lot of potential is tourism. I have been working to bring a waterslide park to Hollister. It would be a good way to bring more tax dollars into our community, and provide our youth with something to do all summer while they are out of school. It is not easy to make something like this happen, but we are trying. In a recent meeting with Congressman Farr, we discussed developing more tourism, and he made some good suggestions. A large number of visitors to the Pinnacles National Park, go for the wildflowers, and he suggested starting a wildflower festival. We also could take a cue from the town of Mariposa (The gateway to Yosemite) and promote Hollister as “The Gateway to the Pinnacles”. These ideas alone will not solve all of our difficulties, but we need to be creative, and we need to work in a positive direction. The most controversial way to increase our revenues, is to raise taxes. I will repeat something I said recently – “I personally feel like we pay too much in taxes already, and I am personally opposed to raising them.” I also believe that if the community wants to increase their taxes, so that they can have more services, then that is the community’s choice. We will explore various options, and we will seek input from everyone in the community. If the community decides to provide greater funding to the city, we can certainly reevaluate the number of job cuts needed. In the meantime, we must move forward with plans to be financially solvent.
Next, I’d like to clear up some misconceptions, and address some concerns that have been raised. Our financial difficulties are in what is called our “general fund”. We have many different “pots” of money, that is only allowed to be spent on specific things like our “sewer enterprise fund”, or our “redevelopment fund”. General fund money can be spent on basically any area of the city, and it is primarily used for ongoing operations, including police fire, administration, etc. There have been suggestions that we should collect from the cannery, and we are in the midst of doing that, but it is money that belongs in the sewer enterprise fund, not our general fund. There were some loans made 10 and 15 years ago by our redevelopment agency, and again we are working on collecting them, now that we are aware that they were never paid after all of these years. But again, that money belongs to redevelopment, and wont help our need for a reduction in force.
There have been questions about how the RIF list was created. The city manager worked with the council subcommittee to create this list. It was created, with some important guiding principals. Every position was to be considered (no sacred cows), and all alternatives were to be considered. We put an emphasis on cutting positions where the public would get the least possible reduction in service as possible. Again, let me be clear. It is impossible to cut 36 positions, without it impacting the service received by the public, so we tried to minimize the impact as much as possible. We will work with the employee groups and their union representatives, to strategically reorganize the city so that we can maintain the highest level of service possible with the remaining employees. This is one more reason why we need to act now, so that we have 5 months to go through the “meet and confer” process, and make the necessary adjustments. We will provide the community with a report on these adjustments, and all of our plans, as we get closer to the July implementation date. There will be a chain reaction set into place by the RIF, that includes employees’ bumping rights, based on seniority, and a number of employees who’s positions will be eliminated are eligible for early retirement. While the council will be voting on the proposed layoffs next Wednesday the 28th, the actual layoffs would not occur until July 1st. This gives us 5 full months to work with the employee groups, and to explore additional solutions. This also gives those who would be losing their jobs, 5 months to find another job.
I am reticent to even respond to a suggestion made that the positions were chosen out of favoritism, and that city manager Shaddox is a “good ol’ boy”. I’m not even exactly sure what “good ol’ boy” means, but Mr. Shaddox has only been here for about 8 months. He took on this job, unaware of the incredible difficulties awaiting him, and he has done a tremendous job. To those who ridicule him, and suggest that he be “sent packing” – shame on you! To speak with so little knowledge, and to be so ungrateful for a job so well done, again, shame on you. Mr. Shaddox is not some corporate CEO, getting stock options and bonuses by laying off all of the employees. He has nothing to gain in doing this, but knowing in his heart that he did what was best for our community. Instead of critiquing him foolishly, thank him, because we are lucky to have him. This brings me to another important point.
Many employees have defended the value of their contributions, and have questioned whether we value their contributions to the community. I am sorry that they are even asking this question. This RIF is necessary to insure that the city remains financially solvent. It is NOT about the council questioning the value of their work. There have been a number of people who have said ” don’t cut the _________ position, we need them”. We need all of the 36 positions. If there is a position that anyone feels should be cut as an alternative to those on the list, we welcome your suggestions.
We need more community involvement. Many have expressed a concern about public safety, and understandably so. While our cuts would not reduce the number of police officers out on the street, we have had to cut some important preventative programs, such as the DARE program. This is where the community can really make a difference. Our new police chief is working on a volunteer program called “volunteers in policing”. Our Juvenile Justice and Delinquency Prevention Commission” is another great way to get involved. I served on the commission for about 5 years, until last year, and I can tell you that they have needed more commissioners the whole time. I also spent a couple of years going out to juvenile hall on Tuesday nights to spend a couple of hours with the kids. Every one says they want a safe community, and they want something done about crime and gangs. Try spending time with “the kids in the Hall”, and show them that our community cares about them. Give them hope and encouragement, so that maybe they will stay out of gangs, and out of a life of crime. Please don’t say you don’t have time – make the time to get involved. We are all busy, and it’s not easy, but it is important to participate in making Hollister a better place.
Giving thanks. I want to say thank you to all of you who have e-mailed, called, or in person, given encouragement. Thank you from the bottom of my heart. At a time like this, it means more than you know. Sometimes we ask ourselves – “why am I doing this? I don’t need the headaches or sleepless nights.” (side note – I’m writing this at 2am) But then you remind us that we are making a difference, and we are fighting to make things better. If we keep beating up our leaders, they will eventually get beat down. Being negative, and making personal attacks will not make things better. So thanks again for the encouragement. I also want to urge everyone in the community to encourage our city employees as well. There are a lot of great people who have given many years of their lives to this city and this is a very painful time for all of them. Even those who keep their jobs are faced with a much greater workload, and great uncertainty. Take a minute and thank them. If you know of any potential job openings that our affected employees could apply for, let the city know. Anything you can do would mean a lot.
Finally, I want to remind the community of the many good things that are being done. In the past few years, there have been many changes, improvements, and plans for improvements set into motion. Following is a list:
Recycling – we used to have to pay to recycle 3 years ago, and we changed our contract.
Major road repairs and maintenance
Increased staffing in police and fire
New fire station being built – starting this month
Veterans Building completely remodeled in 2003
Updated parks master plan
Finalizing plans for new “Valley View” park
Improvements at the airport, with many more planned
Finalizing an airport master plan
Finalizing our General Plan update
New key personnel – city manager, police chief
Great improvements in both our police and fire departments
Downtown beautification in process, to be completed in June
We have met our deadlines with the Water Quality Control Board
Made major steps forward in fixing our long term waste water treatment plant
Improved drinking water, though there is still much to be done
Greatly improved working relationship with the County
Planning/ building a new animal shelter
There is no denying the fact that we are facing some tough times. We need to continue to work hard, to find solutions, and to plan for our future. Hollister is still a wonderful place to live, and I will do all that I can to keep it that way. Anyone in the community who might still have questions, or ideas, I welcome you to call me.
Tony Bruscia
Mayor of Hollister
