July 25, 2009

Grace under pressure: Walnut Creek (and my employer) for their handling of salary cuts and other tough choices in this sucky economy

Yesterday, I received some unpleasant news, job-wise.

No, I didn’t lose my day job. Phew.

But, like a fair number of us in our suburban community, I have been told I need to take a salary cut in the form of unpaid furloughs. My bosses were apologetic in delivering the news, but I was like, well, they could have laid my co-workers off. Instead, they themselves have taken salary cuts—pretty hefty ones I understand—and they’ve moved things around and are adjusting priorities to keep as many people as possible in their jobs. And, by the way, I’ve lived through one lay-off in my professional life. It was not fun, especially as my husband was also unemployed at the time. I had to deal with filing for unemployment, and we had to scramble to find ways to pay for our own health insurance.

In the end, that layoff ultimately led to different and better opportunities, but it also fed my underlying sense of insecurity that I’ll carry with me the rest of my life—that I can’t take anything for granted, that sometimes we, as in the collective citizenry of our country and globe, must weather forces beyond any one person’s control.

Actually, in my meeting with my bosses, I mentioned Tuesday night’s Walnut Creek City Council meeting. At this meeting, the council had to vote on a difficult budget plan, which I wrote about earlier this week. The plan involved a combination of pay cuts, pay freezes, and benefits cuts to the City Council, the executive management, and an array of city employees, including police. The council also had to approve four layoffs, the elimination of temporary positions, and reducing some staff from full-time to part-time status.

The city is facing a $5.6 million deficit for this year and a projected deficit of nearly $30 million through 2012. Yikes.

I didn’t attend the meeting but watched it on video, which you can do here.

An acquaintance, who went to the meeting, said it was emotional, difficult, but ultimately inspiring in that there was a real sense of collaboration and shared sacrifice amongst the various groups affected. She said it made her proud to be a resident of Walnut Creek.

And before I go on, I know that I have written commentaries in which I nag and criticize city leaders on various issues. But, I will concede, in this situation and in this crisis, the city leaders are setting the right tone.

My acquaintance said, for example, that she was heartened—and so were parents groups, and the superintendents of the Walnut Creek and Mt. Diablo school districts—by the council’s decision to find the $110,000 needed to continue, through this upcoming school year, the crossing guard program, which serves 10 intersections leading to elementary and middle schools around town.

Dick Nicoll, interim superintendent for the Mt. Diablo school district, spoke of the great partnership that the city has had with his district over the years. That Walnut Creek, unlike other cities, has stepped up and contributed to such projects as the construction of the Foothill Middle School gym, which has become a facility used by people throughout the community. Nicoll spoke of how everyone is having to make concessions at this time, then thanked the city for coming up with a recommendation to keep the crossing guard program going, at least through the next year.

Another group that stepped up was the police officer’s association, whose members voluntarily agreed to a salary freeze, which will save the city about $620,000.

City spending on the new library was cut $500,000, but staff and board members of the Walnut Creek Library Foundation said they understood that the funding reduction was necessary and that they would do what they could to make up the loss. The foundation has already raised $5 million to help fund the new library; construction, so far, is coming along well and on schedule.

(For those who continue to question whether the city should have even embarked on this library project in the first place, you might have a point, but that darned horse, as the saying goes, is already way out of the barn. Construction is underway, and the city now has to finish what it started in the best way possible.)

“We understand,” said Kristin Anderson, executive director of the foundation, said about the city funding cut. “This isn’t what we would like but it’s what needs to be done. This is a time for shared sacrifice.”

Echoed Dianne Longshore, vice president of the foundation board: “There are partnerships and there are partnerships, and we’ve had a fantastic one with you. … In that spirit of partnership, we have been here during the good times, and we’ll be here for the tough times. We’ll do what we can to help balance the budget.”

Shared sacrifice. Spirit of cooperation. What a concept. But, we pulled that off at my workplace. And from what I saw and heard about Tuesday night’s city council meeting, it sounds like that was the spirit guiding difficult decisions in our city, at least on Tuesday night.

Sure, we still have the Neiman Marcus mess to contend with.

Gee, it would be nice if our representatives in Sacramento, from the governor to the legislators to, yes, the lobbyists for the various special interest groups, could show that same spirit of cooperation and shared sacrifice. As Council member Kish Rajan said in an e-mail he sent out to residents, the “continued dysfunction and irresponsibility at the state level are an outrage.”


Anna, The Lemon Lady said...

Whew! We are all sailing in rocky waters. Like you, I don't take anything for granted either. I'm glad that writers continue to share these perspectives. Makes me feel that I'm not the only one with these anxieties. Thanks, and have a good day Soccer Mom.

Anonymous said...


Sorry about your bad news. Glad it's not SUPER bad though. These are definitely scary times!

Thanks for sharing how WC handled their situation. Sounds pretty commendable.

I feel the same anxiety, I'm unemployed right now. But I'm sure I'll land on my feet somehow.

Anonymous said...

Thanks for your thoughtful commentary.
I have been through the salary reductions and leave-without-pay several times as well.
This is still preferable to seeing more colleagues laid off in my opinion. Glad to hear your company at the City took such pains to minimize the impacts of a dire situation.

Anonymous said...

I don't wish to play "can you top this" but when talking about just how scary these economic times are, please give a moment of thought to we retired folk.

Years of careful planning for our "golden" years have gone out the window, never to be recovered. We have watched our stock portfoios go in the toilet and have little chance to live long enough to see a rebound that we depend on for our daily living expenses. Many of our former employers have found it necessary to reduce our remaining retirement benefits juat to stay in business. Gone are the frills that we allowed ourselves once in a while because we now need to keep our heads above water so as not to be a burden to our children in the years to come. We have no future in which to re-coup what we have lost. There are no jobs waiting for 65+ year olds.

Not being a great believer in Prop. 13 when it passed in 1978, I now really appreciate it. It is doing it's job by keeping many of us from being priced out of our homes due to higher taxes!

It is nice to see that the City staff is pulling together to do what is necessary to keep their jobs. However, maybe some of this would not have been necessary if the Council had not been so strongly in favor of the lavish one-time capital improvement such as the library which has taken up so much of the reserve funds. If many of the staff felt that they could speak candidly about this issue, everyone would have their eyes opened as to the foolishness of this huge expenditure. This is a classic example of poor financial planning!

Walnut Creek will survive, as will we all. Hopefully we will all come out of this mess a bit wiser in the ways of financial planning and be mindful of our real obligations in life.

DumbAsBricks said...

Prop 13 saved my family's butt. We are priced out of the market coming from out of state. We rented from folks who purchased their home a long time ago, therefore, pay very little in the way of property taxes. They pass the savings on to us, and everyone is happy. We wouldn't be able to live in California if not for this.

On the other hand, many young families like mine are forced to pay rent and are subjected to lower wages (as most young people are). We never get a chance to build our wealth and pay taxes. All of the retirees are just sitting on the resources of the state, not paying taxes, and are eliminating opportunity for the younger generations.

Anonymous said...

Being a recent homebuyer, it's a pleasure to be able to subsidize you all paying next to nothing in property taxes these days. You're welcome.

Anonymous said...

Interesting points regarding Prop 13. Seems like major commercial property owners are doing a good job getting the support of residential property owners. If you look at the whole picture you would notice that since the introduction of Prop 13 property taxes have undergone a major shift away from large commercial property owners to residential owners.

So it might well be that if it wasn't for Prop 13 people like DumbAsBricks actually would have a much easier financial time in California with major property owner paying a fair share.

Anonymous said...

Wow Crazy in Surburbia, do we work at the same place? As my employer also announced 15% salary cuts across the board on Friday afternoon. And like you, I'm glad nobody was laid off. Curios, where do you work??? LOL!

Anonymous said...

10:39 - Please clarify.

Anonymous said...

Anon 8:04

see for example:

Anonymous said...

or here is a more recent article

DumbAsBricks said...

It does present an unfair advantage to private and commercial owners who rent properties they have owned for a long time. They can charge far less rent than someone investing in a property today. They do this and pay almost nothing in property taxes. Some houses in WC were purchased for $125K only 20 years ago. And now have a cost basis of $1Million plus. However, the owners of those properties only pay on a basis of $200K instead of $1Million.

However, if I purchase that same residence, I have to pay on a basis of $1Million. Doesn't make any sense. Is that housing price inflated because of the advantage of doing an exchange (another loophole)?

The Governator has all of my respect, but if he wants to secure a legacy, he will have to fix this.

Anonymous said...

Hi DABricks,
How about modifying Prop 13 regarding commercial AND rental property. Would that make you and other single-home-owners feel better?
I do believe that it is unfair for corporations and rental property owners to share the benefits that were designed for homeowners. The burdens have shifted to us, for sure.