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City Council
Staff Report
From: City Manager
Report Type: CONSENT CALENDAR
Lead Department: Human Resources
Meeting Date: November 18, 2024
Report #:2410-3654
TITLE
Adoption of: (1) Revised Salary Schedules for unrepresented Management and Professional employees to increase the Utilities Director Classification by 5% as discussed and recommended by the Finance Committee on October 15, 2024, and (2) revised salary schedule for Service Employees International Union Local 521 in Alignment with one new position change in the FY 2025 Adopted Budget; CEQA Status - not a project
RECOMMENDATION
Staff recommends that the City Council:
•Adopt revised salary schedule for unrepresented Management and Professional employees to increase the Utilities Director Classification by 5%, and •Adopt a revised salary schedule for Service Employees International Union Local 521 in alignment with approved position change adopted in the FY 2025 Adopted Operating Budget to add the Animal Care Specialist position.
EXECUTIVE SUMMARY
As the City began the recruitment process for the next Utilities Director, it was identified that the existing salary range should be reviewed. Utilities is a highly competitive industry and more so when recruiting for oversight of five utilities; the recommended amendment to the compensation range is expected to be necessary to attract qualified candidates for this department head position. The action before Council would increase the annual maximum salary from $377,104 to $395,970 upon adoption by Council.
In addition, during the FY 2025 Annual Budget, City Council approved a new position for the Junior Museum and Zoo. The City has now completed its meet and confer obligations with SEIU 521 and has a mutually agreed upon job description and salary range for the new classification of Animal Care Specialist at the Junior Museum and Zoo.
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BACKGROUND
In adopting the FY 2025 operating budget, the Council authorized net 27.17 FTE position additions and adjustments. These changes included deleting existing positions, reclassifying existing positions, and the creation of new job classifications within the City’s unrepresented and represented employee groups. While funding was allocated for these position changes as part of the FY 2025 Adopted Budget, the final approved salary range is not adopted until the appropriate administrative processes are completed, which sometimes includes a meet and confer requirement with impacted labor unions.
The Finance Committee, during the FY 2025 annual budget process, met with Community Services staff currently running the Junior Museum and Zoo as well as received an updated report from a City retained consulting firm who specializes in organizational reviews of Museums, zoos, and other cultural exhibits. During this discussion on May 7, 2024, the Finance Committee gave direction to increase customer service and animal care by creating a new position classification and transitioning four part-time positions into four of the new full-time positions specific to animal care and handling. These new positions are classified within the SEIU 521 bargaining unit and required meet and confer prior to the City being able to recruit for these positions. City Council approved the additional positions in June 2024.
In preparation for the retirement of the City’s current Utilities Director, Dean Batchelor, staff have retained the services of Teri Black and Company “TBC” to run a nationwide executive recruitment. In preparation for this recruitment, TBC reviewed comparator agencies throughout California to determine the competitiveness of Palo Alto’s current Utilities Director salary range. During Finance committee discussions and feedback on October 15, 2024, the Finance Committee asked TBC if they felt there was a need for adjustment to the salary of the position based on their analysis. TBC responded that they felt the breadth of the Palo Alto Utilities Director position made it an especially challenging position to fill and that qualified candidates may be hesitant to leave similar positions for what is considered a larger job with equal or in some instances less pay. TBC informed the committee that a 5-10% increase could and should be considered to aid in the recruitment of top candidates for this critical position.
Based on consensus from the Finance Committee on this recommendation, staff expedited bringing to Council a recommended 5% increase to the Utilities Director salary to avoid creating any delays to the recruitment process.
ANALYSIS
Staff have completed the required meet and confer process and/or internal position creation required for each of the SEIU 521 represented positions, and all actions have been accomplished within the FY 2025 Adopted Operating Budget funding set aside for these 5 7
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position changes. Adopting the staff recommendation and revised SEIU salary schedule is an administrative step related to the Council's previous direction through the budget process.
The additional recommendation presented is a change to the Management and Professional Compensation Plan for only the Utilities Director position and is at the sole discretion of the City which does not require a meet and confer obligation. After review of the salary data collected by TBC and presented to the Finance Committee, staff is in concurrence with the Finance Committee consensus to adjust the Utilities Director salary to encourage the application of the most qualified and able candidates. Of note within the data provided by TBC are Santa Clara’s Chief Electric Utility Officer ($429,899 annual salary) and Roseville Utilities Director ($391,805 annual salary). These two local competitors are electric only in scope of assignment. This will also provide better alignment within the department adjusting to a 14% compensation difference between the next position of Chief Operating Officer in Utilities.
FISCAL/RESOURCE IMPACT
There is no immediate fiscal impact anticipated from the actions recommended in this report as these adjustments have either been factored into the FY 2025 Adopted Budget or can be absorbed by vacancy savings within the current fiscal year. Funding for future years will be reviewed as part of the annual budget process.
STAKEHOLDER ENGAGEMENT
City staff will post the revised salary schedules and revised Management and Professional Compensation Plan on the City’s website after Council adoption for public access.
ENVIRONMENTAL REVIEW
Council action on this item is not a project as defined by CEQA because adopting a revised salary schedules and compensation plan is a continuing administrative activity. CEQA Guidelines section 15378(b)(2).
ATTACHMENTS
Attachment A: SEIU Salary Schedule 2023 - 2024 (FY25)
Attachment B: Management and Conf Salary Schedule Final 2023 - 2024 (FY25) APPROVED BY:
Sandra Blanch, Human Resources Director