Citys transformation effort to continue this year

February 6, 2011
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The transformation of city government, recasting how it offers services, is still prominently entrenched in the mind of Grand Rapids Mayor George Heartwell. In fact, the mayor said he ranks this conversion at the top of his to-do list this year and places it slightly ahead of environmental sustainability.

“You’ve heard me say it. You’ve heard commissioners say it. You’ve heard the manager say it. We must transform the way the city delivers services, for not to do so is unsustainable,” he said.

Heartwell noted that the transformation process is well under way with a fundamental redevelopment of the city’s information technology department. He said the city’s technological capabilities have been improved, its website has been enhanced and all public documents are available online.

“There are few, if any, municipal fees or taxes that cannot be paid online. We have done a soft launch of our mobile 311 request (line) for city services and we will fully implement the program within two years. Today, by simply downloading an app to your iPhone or Android, you can report potholes, traffic, or streetlights out, or graffiti tags,” he said.

“Soon you will be able to use the 311 app for any other city service, including trash or recycle removal, water or wastewater services, housing or property nuisance reports.”

Heartwell noted that citywide wireless Internet access was made available to residents last fall, and every member of the police, fire and housing inspection departments has full access throughout the city. Starting this summer, the city will use its technology to weigh the recyclables that residents put out for pickup through a bar code imbedded in each bin. The city will use that data to reward residents who recycle the most by giving them discount coupons to local merchants. The city has partnered with Local First for the rewards program. “We call this MyGRCityPoints,” he said.

A key element of the transformation is the sharing of services, and Heartwell said the city was working with Kentwood and Wyoming on creating a regional fire authority, where the three cities would work together to provide fire-department services. “I have been delighted at the appetite of several of my colleague mayors for consolidation. In fact, our collective efforts to date caught the attention of (Gov.) Rick Snyder, who spent time with me and our team at City Hall talking about service consolidation,” said the mayor.

But the most important and most controversial element in the transformation process is establishing new compensation agreements with the city’s unionized and non-union employees. “The current level of benefits received by municipal employees is, I am convinced, unsustainable in the long haul,” he said. Negotiations along this line resulted last year in a 4 percent reduction of total compensation. Even so, the mayor said employee benefits still equal 35 percent of an employee’s total compensation and will rise to 41 percent in three years, even with the latest reductions, because of projected increases in health insurance premiums and contributions to the pension funds.

“Pension contribution alone will increase by 65 percent during this period. This benefit level is not typically found in the private sector and, if we cannot control it, it will break the back of local government,” Heartwell said.

Although the unionized workers have agreed to pay 10 percent of their medical insurance premiums, the city’s non-unionized employees, including elected officials, have agreed to pay 20 percent of those premiums. The non-unionized employees have also agreed to a pay cut of 10 percent. Heartwell said the city’s goal is to have union members make the same concessions as the non-unionized employees, and he hopes to take a giant step toward accomplishing that by the end of this year.

“The city’s proposal is on the table for a 10 percent reduction in overall compensation, largely focused on pension benefits this year. In our last contract negotiations, we focused on health care and spreading the cost of health care. We were successful in getting 4.1 percent in concessions in the last contract, and we fully expect we will get our 10 percent concession this time. We’re making good progress with those we’re talking to — those unions that are at the table right now,” he said.

“These are difficult negotiations,” he added. “But I firmly believe that the ability of our local government to deliver services at the levels demanded by our citizens is totally dependent on our getting these costs under control.”

Heartwell said without employee concessions to compensation levels, the other transformative things the city has done would only delay its demise. He pointed to a study released by the Business Leaders of Michigan that showed compensation levels for those in the private sector have decreased the past few years, while their public-sector peers have recorded increases. He also referred to information the governor released that reported much the same thing has happened over the past decade.

“What’s interesting is that there has been a slight downward trend in compensation in the private sector during that period of time. The local government had a slightly upward trend. Teachers had a much sharper upward trend, and state employees had a precipitous upward trend,” said Heartwell of the data Snyder released.

“So I think the objective for local government, and certainly I hope for state government, is going to be to bring those (compensation levels) in line with the private sector. We need to be sure that our compensation, which includes pension benefits, retiree health care and health care for our work force, is in line with what we’re seeing in the private sector.”

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