LTC 209-2008 Loss of Revenue/Potential Savings and Employee Concerns - Responsem MIAMIBEACH
OFFICE OF THE CITY MANAGER
NO. LTC # 209-2008
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LETTER Tfl CCJMMISSIC~I ~, `~
TO: Mayor Matti H. Bower and Members of the City Commission
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FROM: Jorge M. Gonzalez, City Manager ~~
DATE: August 15, 2008
SUBJECT: LOSS OF REVENUE/POTENTIAL SAVINGS AND EMPLOYEE CO CERNS -
RESPONSE
On July 17'h and August 5th, respectively, employees of the City's parking enforcement unit sent
correspondences to the Mayor and Commission regarding the subject of "Loss of Revenue/Potential
Savings" and "employee concerns". This LTC will address those concerns and may be useful to the
City Commission for subsequent discussions on the topic of contracted parking enforcement.
The option to contract for Parking Enforcement Services is a part of an ongoing effort that the City
undertakes to assess opportunities to deliver service to our residents and businesses in a more cost
efficient manner. While a significant focus on methods of service delivery occurs as a part of the
budget process, the assessment is not limited to that time. This contracting option is not necessary
to balance the fiscal year 2008-2009 budget, yet it still represents a significant opportunity forfuture
consideration.
As with many other cost saving opportunities that get consideration, this is not the first time that
contracting for service has been considered by the City. With the passage of time and the change
in costs, this particular contracting option has evolved into a viable opportunityforthe City to explore
at this time.
The issue of contracting the City's parking enforcement services is an option that would save the
City up to $1.4M per year from its current costs and most of these savings are attributable to salaries
and benefits through contracted services. The City's Parking Director has met with the employees of
the parking enforcement unit (and all other units of the Parking Department) and apprised them of
the contracted services concept for parking enforcement.
One of the serious allegations raised is that the Parking Department manages through "fear and
intimidation". The Department's and my actions clearly do not lend any credence to this assertion.
The Parking Department follows and champions the management philosophy that I have worked on
for my full tenure as City Manager. The Parking Department is one of the organization leaders in
helping to realize one of my objectives which are a leadership approach that embraces open
communication, employee participation, and teamwork by competent and ethical professionals.
The Parking Department is a progressive organization that fosters organizational development,
diversity, and teamwork. Most of the employees in the department enjoy this environment and have
flourished and truly embraced the One City -One Team concept through a comprehensive training
program that includes: customer service, diversity, sexual harassment, ethics, teambuilding, and
Page 2, Loss of Revenue LTC
annual strategic planning sessions. In addition to these training opportunities, employees participate
in focus group sessions and there are numerous communications including staff meetings, collateral
materials, and an annual retreat.
It is somewhat disingenuous to raise loss of revenue and expense savings recommendations only
when the issue of contracting parking enforcement services is raised. The Parking Department
holds a series of "focus group" meeting with all parking department employees twice a year in order
to identify any issues employees may have and in particular encourage suggestions and/or
recommendations for opportunities to increase efficiencies/revenue and/or decrease expenses.
These suggestions are always welcomed and encouraged. Since the inception of Focus Groups
meetings, there have been 295 issues raised by the Parking enforcement unit alone. While a small
percentage of the issues raised relate to the City and its operations in some manner, many of the
issues raised are directly related to the individual employee. These include more opportunities for
overtime; 4/10 schedules; rotating weekends off; compensatory time; designated parking spaces for
employees; request for new/upgraded vehicles; and many others. Most have been addressed,
others are pending, and others are not feasible.
The Focus Group sessions are a process where employees are encouraged to voice their
concern(s), suggestions}, and/or issue(s) either at the meeting or shortly thereafter in order to
address their concerns}. Although it may sound like a cliche, a happy employee is more productive
than a disgruntled employee. Identifying and resolving employee problems are given a high priority
in the Parking Department. In some instances, suggestions and/or recommendations have been
implemented and employees have been recognized and rewarded. The Parking Department
provides a number of employee recognition programs, including employee of the month; employee
of the year; supervisor of the year; and the "Golden Meter". Moreover, in FY 2007/2008, the Parking
Department identified fiscal responsibility; accountability; and excellent customer service as their
three departmental strategic planning goals.
Over the last five years, there have been 49 opportunities at training sessions, staff meetings, focus
groups sessions, and departmental retreats to identify opportunities for revenue enhancements
and/or expense savings. This equates to an opportunity to provide valuable input and voice
concerns in a formal setting, almost monthly. Unfortunately, none of the attached
suggestions/issues of revenue increases; potential savings; and/or fear and intimidation have been
raised by the employees until now.
Incidentally, a reference was made to the Parking Department's Annual Retreat which was held this
past June where the issue of Ethics was a topic and an exercise termed, "The Journey" was used to
convey a "thought provoking" exercise to instill and motivate employee ethical behavior. The
exercise provided employees with a heightened awareness of how unethical behavior may
progressively lead to a path of destruction, both professionally and personally. To be clear, there
were no employee arrest simulations. Employees while at their seat listened to an audio exercise
where a city employee hypothetically commits an illegal act; is arrested; and deals with the potential
consequences. The use of blindfolds was a valuable tool for participants to be more attune with the
exercise itself, this was of particular significance as the exercise was in an audible form only and
had no visuals. Prior to commencing the exercise, employees who wished not to participate were
excused. There was one such employee, a parking enforcement specialist, who was excused.
The Parking Department's Annual Retreat is an opportunity for all of the Department employees to
meet all at once. As part of the Retreat (and all other training sessions), employees are requested
to complete a course evaluation form rating the effectiveness of the session, using a scale of "1"
being Poor and "5" being Excellent, including an opportunity for written comments is also provided
and the evaluations are all submitted anonymously. 97 Parking Department employees attended
the Retreat and 89 (92%} completed the course evaluation form. The course evaluation form
Page 3, Loss of Revenue LTC
average score was 4.2 which was in the good to excellent range. There was no response lower
than a "3" which is satisfactory and there were no negative comments regarding the Retreat and/or
the exercises. In fact, to the contrary, the following are excerpts from the evaluation form comments
section: What did you like best about the session? "doing the right thing!"; "blindfold exercise -very
good"; "awareness on human weaknesses": `I like most about ethics"; "the video and topics"; "the
presentation". The comments were quoted verbatim from the course evaluation form. This and all
exercises provided through our organizational development programs are intended to touch the
mind and heart in order to provoke thought about the subject matter.
There are other allegations that are also quite serious and are further addressed later in this
response. In the end, productivity and the policy questions of how much is enough or too much
enforcement effort can be affected either through our current management structure or through a
contracted service.
The employee allegedly identifies various new opportunities to increase revenue and/or decrease
expenses and the implication is that these opportunities have somehow not been seized due to
incompetence and mismanagement by the Parking Department's Management Team. The
employee attempts to substantiate their claims with 13 examples below, for more detailed
information, please refer to the employee's correspondence which is attached.
Employee Concerns:
1. Mismanagement of PES1-low Production/$1.25M/yr loss of revenue and could have
been savings of $1.25M
2. Mismanagement of PES1-low Production/$150,000/yr loss of revenue and could have
been savings of $450,000
3. Mismanagement of Sale of Visitor permit vs. residential/$49,000 and could have been
savings.
4. Dispatchers to do "call-taking" of complains/$12,000/mth/About $100,000+
5. Current free parking at Commercial LZ after 6:00 PM/$145,000/yr
6. Passenger LZ increase fee/$36,400/yr
7. Deliberately jammed and filled meters/$65,000/yr/$65,000/could have been savings
8. Missing Meters/$32,500/yr
9. Valet space fee/$26,000/yr
10. Motorcycle spaces in residential zone/$4,800/yr
11. Hotel hang tag/$8,320/yr
12. Recommended new areas for meters/$87,460/yr
13. (A-I) See page 7 of employee's correspondence
Page 4, Loss of Revenue LTC
The Administration has reviewed each of the concerns expressed and examples and the following is
in response:
Nos. 1 and 2 -Mismanagement and Low Productivity.
Response:
Parking Citation Issuance and Revenues
Both productivity and citation revenue has increased since the Parking Enforcement Manager (PEM)
joined the unit in May 2006. Please see the table below which compares the last three fiscal years
(October through June} for citation issuance (% +l-) and revenue (% +l-):
2005/2006* 2006/2007 % +l(-~ 2007/2008 % +l(-)
Citations Issued 151,150* 174,148 15.2% 196,718 12.9%
(10/1 /07-6/30/98)
Revenue $1,883,944* $2,194,748 16.5% $2,444,214 11.3%
(10/1 /07-6/30/08)
Revenue
(Full Year) $2,551,002* $2,987,259 17.1 % $3,258,952** 9.1 %**
Citations
Per PES/Per Year 3,435 4,248 23.6% 4,372 2.9%
Notes: *Prior to current PEM. Also, residua! effects of Hurricane Wilma resulted in
productivity and revenue decreases of approximately 25%; therefore, the months of
October and November 2005 should be increased by 25%. The following represents
normalized totals for 2005/2006: 158,830 citations; $1,981,955 Revenue (10/1/07-
6/30/08); and $2, 642, 606 Revenue (full year).
**Estimated Full Year
While there are opportunities to continue to increase productivitywith full-time employees, given the
nature of the service, productivity is not expected to decline with contracted services, rather, get
better. Contracted employees have a more single purpose focus to address specified outcomes as
apart of contract provisions.
Productivity vs. Quotas
There seems to be a recommendation by the employee to require an increase of 15 parking
citations per officer per day and thus, generate up to a $1.25M increase in revenue. A required
increase [15] in the issuance of parking citations may be interpreted as a "quota" for citation
issuance. Quotas in enforcement tend to be inconsistent with the quality of the service provided and
create more issues than they solve. From a public relations perspective, the perception (real or not)
is that the issuance of a parking citation is motivated to achieve a quota rather than the legitimacy of
the violation. The City has no such minimum requirements for parking citation productivity or any
other types of citations for that matter. The Parking Department Management Team encourages
every employee to be productive. In the case of parking enforcement, Parking Enforcement
Specialists (PESs) should issue citations for all violations encountered. PESs also enjoy some level
of discretion in the issuance of parking citations in order to provide excellent customer service as
they serve as ambassadors of the city.
Page 5, Loss of Revenue LTC
No. 3 - Mismanagement of Sale of Visitor permit vs. residential/$49,000 and could have been
savings.
Response:
The sale of residential parking visitor hang-tags was identified by the Parking Management Team in
last year's (2007/2008) budget process as a chance to improve the residential parking program and
a revenue enhancement opportunity. The City's Finance and Citywide Project Committee
considered the issue on July 8, 2008 during the 2008/2009 Budget discussions. The Finance
Committee directed the Administration to discontinue the sale of residential visitor hang-tag ($10.00
per year) and continue with the sale of scratch-off visitor hang-tags ($1.00 per use).
No. 4 -Dispatchers to do "call-taking" of complains/$12,000/mth/About $100,000+.
Response:
In order to alleviate the call volume to the Police Department's Public Safety Communications Unit
(PSCU), who incidentally are also in the same collective bargaining unit, "CWA" (Communications
Workers of America) as parking enforcement employees, the call taking and dispatching duties for
noise and related code enforcement complaints were assigned to the Parking Enforcement Dispatch
Unit. This allows PSCU to more adequately and appropriately address life safety service calls.
The increase in call volume to the Parking Enforcement Dispatch Unit is being initially addressed by
four (4) temporary parking enforcement specialists in order to determine call taking and dispatch
needs. A six month pilot period was established to determine these needs. The pilot period began
Memorial Day Weekend 2008 and will continue through the Fall (season) of this year to better
ascertain needs. This was the preferred alternative as opposed to creating new positions in an
attempt to address an unknown need.
While it is recognized that there was a minor temporary drop in parking enforcement service levels,
the need to alleviate the Police's PSCU call volume and dispatch activity for non-emergency calls
was deemed a higher priority in order to provide higher service levels for emergency (life/safety)
requests for service.
No. 5 -Current free parking at Commercial LZ after 6:00 PM/$145,000/yr.
No. 6 -Passenger LZ increase fee/$36,400/yr.
No. 9 Valet space fee/$26,000/yr
No. 10 Motorcycle spaces in residential zone/$4,800/yr
No. 11 Hotel hang tag/$8,320/yr
No. 12 Recommended new areas for meters/$87,460/yr
Response:
Issues Nos. 5, 6, 9, 10, 11, 12, and 13 deal all or mostly with either proposed fee increases or new
fees. The City Commission has been very clear that fiscal stability through increased fees is not the
preferred policy. Raising fees is always an option available to the City and has no direct relationship
to the use of contract employees.
Page 6, Loss of Revenue LTC
Nos. 7 and 8 -Deliberately jammed and filled meters/$65,000/yr/$32,500
Response:
Parking meter operability has been identified at 95% by an internal audit. The Parking Meter
Maintenance Unit has made a significant and successful effort in keeping up with all of the projects
and challenges that have come their way. This unit is to be commended for their hard work,
dedication, and professionalism. This unit has successfully completed or substantially completed
the following projects: Multi-space Pay Stations Phase I and II which includes the installation and
maintenance of over 364 units and the installation and maintenance of over 4,000 single space
meter locking systems and initiated the process to install 4,000 single space parking meter
mechanisms. Parkeon, the manufacturer of our multi-space pay stations and their support
personnel, have commended the Parking Meter Maintenance unit as being able to diagnose and
troubleshoot malfunctions that Parkeon was not aware of.
Lastly, during the current year's budget review, the Parking Department Management Team
reallocated resources and established a third Parking Meter Technician II position (no increased
cost) to enhance the unit's ability to address these and other operational issues.
Conclusion
In summary, most if not all of the issues raised by the employees have been identified and/or
addressed either wholly or in part through the on-going employee participation programs and this
memo. It is unfortunate, albeit not unexpected, that certain employees react to the contracted
service option with unfounded assertions.
In the final analysis, the allegations characterizing the Parking Department's Management Team as
incompetent leaders; mismanaging employees and resources, and leading the employees through
fear and intimidation are unsubstantiated. In fact, many of the other front line employees (non-
parking enforcement personnel) within the department have quite a different view of the
Department's leadership efforts and accomplishments.
These concerns expressed are an attempt to distract from the fact that the contracting of parking
enforcement services provides a savings to the City estimated at approximately $1.4M per year for
personnel costs and up to $1.9 M per year considering other possible savings.
JMG/RCM/SF
F:lcmgr\$ALL1B08\LossofRevenuePotential SavingsEmployeeConcerns08132008-Response Itc (2).doc