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MEASURES A & B IMPLEMENTATION PLAN - PHASE I
RECOMMENDATION
Adopt a resolution approving the Phase I elements of the Implementation Plan for Measures A and B, amending the 2013-14 General Fund Annual Budget to include Measure A revenues and first phase of expenditures, and authorizing 120 sworn and 43 civilian staff positions to be phased in over four fiscal years including forty (40) additional Police Officer positions in the Police Department, one Senior Human Resources Analyst in Human Resources, one Program Manager II (Confidential), one Supervising Accountant, one Senior Accountant and one Finance Assistant in Administrative Services Department with recruitment to begin in Fiscal Year 2013-14.
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Summary
On November 5, 2013, the citizens of Stockton approved Measure A, a ¾-cent sales tax measure, effective April 1, 2014. The citizens of Stockton also approved Measure B, an advisory measure which allocates 65% of the sales tax revenue towards increasing public safety through the continued implementation of the Marshall Plan. The remaining 35% of the tax revenue is allocated to pay for the City's efforts to end bankruptcy and for services to residents, businesses and property owners which will continue to be implemented through this report and through the Fiscal Year 2014-15 budget process, future Council action, and upon court approval of the City's plan to exit bankruptcy.
Phase I of the implementation plan for Measures A and B, particularly the portion dedicated to public safety, will occur over the next four years and be dependent, in part, on how closely the revenues match the City's financial forecast. In an effort to continue the Police Department's recruitment and hiring success achieved over the last two years and, in recognition of the lengthy selection and background process, staff is recommending the City Council authorize recruitment of the first of the additional 120 sworn officer positions, estimated at 40, to start as early as March 2014. The remaining positions and elements to the public safety plan will follow the timeline outlined below, subject to verification of sufficient sales tax revenue to support additional expenditures. Additional positions in Administrative Services and in Human Resources are also being recommended with this staff report in order to effectively support implementation of the plan and continue the efforts to restore and sustain fiscal health.
Additional phases and elements of Measures A and B activities will be brought before City Council during the 2014-15 budget hearings held in June. We anticipate presenting further refinements of the implementation plan to include proposed appropriations that address critical unmet needs, bankruptcy exit plans, and service restoration to citizens that adhere to the objectives of the Measures. A Measures A and B Citizen's Advisory Committee will be formed to review the expenditure of revenues generated by the tax imposed by Measure A and make recommendations to the City Council regarding those expenditures.
City Council action from this staff report includes appropriation for the new sales tax revenues and expenditures for new positions and other operating expenses. These increased appropriations have been reflected in the Fiscal Year 2013-14 First Quarter general fund budget update presented at this Council meeting.
DISCUSSION
Background
In 2009, the City of Stockton declared its first fiscal emergency and began implementing significant across-the-board budget cuts as a result of corresponding drops in realized revenue. The Police Department endured cuts throughout these years culminating in a 25% reduction in sworn staffing and a 30% reduction in civilian support staff. Several independent studies have shown the Police force for a city the size and complexity of Stockton was already significantly understaffed even before the cuts took place. The further reductions in Police Department staffing contributed to skyrocketing gang and gun activity that produced two years of record-breaking homicides, 58 in 2011 and 71 in 2012. The 2012 number more than doubled the rate from 2009, which had 34.
In 2011, City Council adopted a set of Strategic Initiatives intended to guide staff towards accomplishing the Council's goals. Among those goals was increased public safety, both real and perceived. The Strategic Initiative most closely related is the Marshall Plan on Crime. Designed as a comprehensive, multi-jurisdictional approach to addressing the endemic violence in Stockton and San Joaquin County, the Marshall Plan seeks to identify specific tasks and policy changes that will help community and governmental leaders address the rampant violence and take steps towards reducing, and ultimately controlling and/or eliminating, key elements that prevent a safe and secure community.
In 2012, the Police Department presented a Violence Reduction Initiative which introduced the focus of the Department on gang and gun violence and set forth a framework to implement the initiative through the four P's: Pursuit, Predict, Prevent, and Partner. This has resulted in the release of the Police Department's current Three-Year Strategic Policing Plan.
The City's support services to the departments also experienced severe cuts (43%) during the many years of its fiscal crisis. These cuts, when coupled with the demands placed on the City due to the bankruptcy and the strategic initiative to resolve the financial problems of the past, do not allow for additional workload to be added to an already overburdened staff. The capacity limitations have been reported by the City's internal auditors, external auditors, grand jury and the State Controller's Office. Additional resources will be needed to support the implementation of the sales tax measure due to increases in hiring, accounting and financial reporting and to ensure ongoing compliance with the objectives and intent of the tax. These additional positions are also needed to continue the efforts to restore and sustain fiscal health.
Present Situation
Among its host of recommendations, the Marshall Plan calls for:
· rebuilding the Police Department,
· creating an Office of Violence Prevention
· implementing a Neighborhood Blitz Team.
The passage of Measures A and B provides the necessary funding to implement these recommendations. Although increased staffing is the main driving factor, it remains clear that increased staffing alone will not fix Stockton's violence problem. Careful attention must be paid to how these new positions are used.
Rebuilding the Police Department
The initial rebuilding phase calls for increasing the sworn Police force by 120 Officers, returning the Department to just above 2008 staffing levels. The community will not see changes overnight as the additional positions will be phased in over a four-year time frame for the following reasons: it takes time to hire officers; the Department does not have adequate training resources to take on 120 at once; and maintaining officer safety includes not scheduling all of the new officers on the same shift. This Council is well aware of the challenges the Department has had to overcome to fill existing vacancies over the last two years. During that time period, over 130 Officers were hired, however the Department lost approximately 100 during that same time period, for a net hire of 30 officers. Through diligent recruitment, hiring, and retention strategies, the Department is now close to filling all 365 authorized sworn positions. While the high attrition rate is not expected to continue now that the City's financial struggles have stabilized, it is expected that hiring 120 additional positions will take time and significant investment in recruitment, training, and screening of candidates.
As noted above, phasing in new Police Officers is also necessary to properly train and not overburden the Department's training resources. Each new hire spends approximately six months in training alongside a Field Training Officer before they can test to assume solo officer duties. In addition, every new officer begins their assignment in Patrol, getting a feel for the streets and responding to calls. It is important to stagger the new officers with more experienced officers as an overall Department safety measure.
In addition to the safety positions described above, the proposed Phase I Measures A and B Implementation Plan includes thirty-eight (38) non-sworn positions to support the additional Police Officers. Included in the non-sworn positions mentioned are those identified below in support of the Office of Violence Prevention and Neighborhood Blitz Team. One Senior Human Resources Analyst position in the Human Resources Department will be added to assist the Police Department with recruitment and hiring of these positions.
Office of Violence Prevention
The Office of Violence Prevention is tasked with ensuring the Marshall Plan is implemented and to help sustain and expand the efforts thereafter. Under the direction of the City Manager's Office, this new Division will manage the current Peacekeeper Program and oversee its expansion; will manage the continued implementation of Operation Ceasefire, and work as a liaison between the City and community partners to further implement the Marshall Plan. New staffing included for this function, funded with Measure A funds, includes a Program Manager, Administrative Analyst, four Youth Outreach Workers, and an Office Assistant I/II. These new positions will be budgeted as part of the Fiscal Year 2014-15 Annual Budget. Peacekeepers remain a critical component of the violence reduction strategy because of their unique ability to communicate with youth and serve as role models while serving as outreach workers, mediating disputes, and providing a safe outlet for our highest risk individuals. .
Neighborhood Blitz Team
The Neighborhood Blitz Team is a concept coined by the Police Department in support of the Marshall Plan recommendation to Reclaim Neighborhoods: Disorder & Blight Reduction. This is a preventative approach to cleaning up the neighborhoods, addressing health and life safety issues through Neighborhood Services Code Enforcement, additional law enforcement, and by engaging the residents to work collaboratively with police to develop and implement an improvement plan and initiate clean up. The key to this concept is the increased enforcement for a specific period of time, 90 days, followed with a check-in 90 days after enforcement ends, and again a full year later.
Administrative Support
This first phase of the Measures A and B Implementation Plan includes administrative positions in Human Resources and Administrative Services Departments that will support the Marshall Plan efforts, Measures A and B monitoring and reporting and allow for the continued efforts to restore and sustain fiscal health. Administrative Services is currently struggling with the competing demands of more robust auditing efforts both internally and externally, better revenue management and collections, designing and implementing best practice procurement policies, improved budget tracking and reporting, improved debt management, and many other baseline functions. Four staff positions in the Administrative Services Department will be added to address critical service gaps. Measures A and B will require significant financial tracking and reporting which will be accomplished by the addition of one Program Manager II (Confidential), one Supervising Accountant, one Senior Accountant, and one Finance Assistant in the Administrative Services Department. Specifically, these positions will support the tracking of financial information, monitoring of compliance with Measures A and B objectives, and reporting to the Oversight Committee and the citizens of Stockton. Because of recent cuts to staff and services, there is insufficient capacity in existing staffing levels to adequately address the requirements of Measures A and B. In addition, the Administrative Services Department has been at the forefront of the efforts to restore the City's fiscal health. As the staffing in PD was being reduced due to the City's financial difficulties, so was the staffing in Administrative Services which experienced similar staffing reductions (31%). New management is currently faced with implementing best practices with this reduced staffing and lack of proper tools and systems to assist. Additional staffing is needed to implement, monitor and report on Measures A and B activities, including the Marshall Plan. The additional positions will also assist in efforts to restore and maintain the City's financial health through improved timeliness and transparency of financial reports, establishment of stronger internal controls, improvement of revenue collection, and resolution of past audit findings.
Human Resources
The addition of a Senior Human Resources Analyst in the Human Resources Department will assist the public safety implementation of Measures A and B, providing the Police Department with recruitment of the additional Police Officer and civilian positions identified in the Marshall Plan. It is anticipated that this position will be required even after the additional staff has been hired to continue recruitment efforts necessary due to normal turnover and to manage ongoing benefit and labor issues.
Administrative Services - Budget
The Program Manager will coordinate with PD staff and others to set up tracking and monitoring of budget to actual activity, analyzing financial data, and providing reports on Measure A sales tax revenues and expenditures of the Marshall Plan including the Neighborhood Blitz and Office of Violence Prevention programs and other costs that meet the objectives of Measures A and B.
Administrative Services - Finance
The Supervising Accountant and Senior Accountant will ensure appropriate accounting treatment, proper internal controls, accuracy, reporting and audits of the financial activities of Measures A and B. The Finance Assistant position will be hired in the disbursements unit where increased payroll, procurement and payment activities will take place for Measures A and B. These positions comply with the objectives of Measures A and B by supporting the Marshall Plan, supporting activities to end bankruptcy and increased City services. Without these additional positions Administrative Services will not be able sustain these efforts or support the administrative requirements of Measures A and B.
Tax Collection and Election
The Board of Equalization will charge an administrative fee for collection and disbursement of Measure A sales tax revenues per the Administrative Agreement approved by City Council on January 28, 2014. It is estimated that the fee may be as much as $55,000 for administration of the quarter ending June 30, 2014.
Timing and Phasing
The additional sales tax rate goes into effect on April 1, 2014, with the first revenue allocation from the State Board of Equalization, to be reflected in the fiscal year 2013-14 fourth quarter status report. The Marshall Plan components will be phased in, based on revenue availability, as follows:
Date |
Milestone |
February 2014 |
Initial 40 Police Officer Positions authorized, began recruitment |
July 1, 2014 |
Fiscal Year 2014/15 Budget includes additional positions for Police Officer support (9); Office of Violence Prevention (7); Neighborhood Services (6); and Neighborhood Blitz (5); Crime Analysis (2) |
July 1, 2014 |
Office of Violence Prevention created |
December 1, 2014 |
First Neighborhood Blitz kicks off |
July 1, 2015 |
Additional 40 Police Officers allocated, begin recruitment; additional positions for Police Officer support (3); Neighborhood Services (1) Third Neighborhood Blitz kicks off |
December 1, 2015 |
Follow up begins for first Neighborhood Blitz |
July 1, 2016 |
Final 40 Police Officer positions allocated, begin recruitment; additional positions for Police Officer support (2); additional positions for Neighborhood Services (2) Follow up begins for third Neighborhood Blitz |
The table below shows how the 163 new positions will be phased in over four fiscal years within each program area.
Authorized New Positions by Fiscal Year (Cumulative)
Fiscal Year 2013-14 2014-15 2015-16 2016-17 2017-18
Police Sworn 8 40 80 120 120
Police Civilian - 11 15 17 17
Office of Violence Prevention - 7 7 7 7
Neighborhood Services - 6 7 9 9
Neighborhood Blitz - 5 5 5 5
Administrative Services 4 4 4 4 4
Human Resources 1 1 1 1 1
Total New Positions 13 74 119 163 163
FINANCIAL SUMMARY
The 2013-14 Adopted Budget did not contemplate or include Measure A sales tax as the tax was not approved by the voters at the time of adoption. It is recommended that the budget be amended to include both Measure A revenue and the first phase of expenditures for Fiscal Year 2013-14 based on this Implementation Plan of the public safety component. Future years shown in this Implementation Plan will be appropriated as part of the City's annual budget process beginning with fiscal year 2014-15. Measure A revenues in Fiscal Year 2013-14 are projected to be $6.8 million for a three-month period, on an accrual basis, starting April 1, 2014. Expenditures total $1,102,836 (which includes $55,000 in sales tax administrative charges and tax audit contract fees as an expenditure for budgetary purposes; netted in revenues for projection purposes in Attachment A). Budgeted expenditures consist of payroll and related costs, equipment, training costs for recruitment and hiring of eight Police Officers, proration for one Human Resources and four Administrative Services positions, Board of Equalization charges, and sales tax audit service fees. The balance of Fiscal Year 2013-14 Measure A expenditures will be appropriated at a later time through Council action. The recommended budget amendment is as follows:
Establish Revenue Budget:
010-0000-314 General Fund Measure A Sales Tax $ 6,803,630
Establish Expenditure Budget:
010-2400-530 General Fund Police Department $ 855,836
010-1610-530 General Fund Human Resources 40,000
010-1300-510 General Fund Administrative Services 152,000
010-0131-510 General Fund Tax Collection & Election 55,000
$ 1,102,836
The Measure A Financial Projection (Attachment A) summarizes projected revenue and expenditures for the next nine fiscal years. The first full year of Marshall Plan implementation is estimated to cost $8.3 million, after $475,595 of additional revenue generated by Neighborhood Services. This is for a total of 74 new positions, including the 8 officers previously authorized in FY 2013-14. The second full year includes the hiring of an additional 40 Police Officers and 5 non-sworn positions for a total projected cost of $15.1 million including an estimated $1.0 million in revenue from Neighborhood Services activity. Fiscal Year 2016-17 will add 40 sworn and 4 non-sworn positions with a total projected cost of $20.9 million including approximately $1.5 million in Neighborhood Services revenue. The First Quarter 2013-14 General Fund Budget Update report is also allocating additional property tax revenue in the amount of $987,000. This report shows that sufficient ongoing revenues are available to cover these expenditures and are within the Plan of Adjustment financial forecast. As described in the ballot language the balance of Measure A funds will help end the bankruptcy and restore other City services including funding one-time mission critical needs.
Detailed General Fund revenue projections are being evaluated, including evaluation of other revenue sources, to ensure funding of expenditures in this Implementation Plan. Monitoring of future General Fund projections will ensure the hiring of additional positions during the implementation phases are consistent with the sales tax revenue and that the total number of positions is sustainable given other changes to compensation and benefits.
Attachment A -Measure A Financial Projection