At the Jan. 8 City of Manzanita Workshop and City Council meeting, the Mayor solicited suggestions from citizens as to next steps on the City Hall project for the Underhill property. The tone of the meetings and desire to maintain momentum on this important community project was encouraging and welcome.
At the council meeting, the city auditor was present to answer questions on last year’s budget. Given that the council had announced that it would be conducting an analysis to determine if reasonable overhead allocations from the water fund were being made for the city manager and assistant city manager, I was content to refrain from making any further public comments on this subject until this analysis was completed but the auditor’s statement that she “didn’t have any heartburn with any of the allocations to the water fund” I believed required a further explanation.
I posed a series of questions to the auditor. 1. She spent about four days in Manzanita to do the audit. 2. She spends the majority of that time in the council chamber reviewing various documents pertinent to the audit. When I challenged how she could observe what any city employee is doing during the day while reviewing documents in the council chambers, she stated that “we wander around back and forth between the two rooms to see what they are doing on a daily basis on those days we are here”. 3. She does review timesheets from the city manager and assistant city manager. I obtained a copy of those timesheets and confirmed that they only record that the employee in question generally works eight hours a day and contain no details as to how that time is allocated to any particular activity.
A municipal audit is an objective examination of the financial statements of the city to make sure that the financial records are a fair and accurate representation of the transactions they claim to represent in accordance with the city’s adopted budget. Confirming overhead allocations in part by wandering around and apparently without any notes of those observations in the audit is a problem.
Rather than simply state that payroll records confirmed that the city manager and assistant city manager did in fact receive 50 percent of their annual salaries from the water fund in accordance with the adopted budget, she made it sound to a roomful of citizens that based on the above circumstances, she was able to definitively conclude that the city manager and assistant city manager are each spending four hours each day in management activities related to the water utility and therefore current overhead allocations are appropriate. Her conclusions unfortunately, raise more questions than they answer.
Councilor Aschenbrener then offered that “allocation of time towards a budget in leadership positions is based on responsibility, not on the number of hours worked.” His analogy to support this conclusion was that you don’t just pay a police officer or a fireman when they respond to an emergency. While both officers and fireman have tremendous responsibilities, they are not managers and they show up each day for their shifts ready to meet the demands of wherever the day brings as described in their job descriptions. Councilor Aschenbrener appears to believe that a subjective standard of “responsibility” regardless of actual time spent in any tangible activity involving our water utility is all that matters for the managers in city hall. Once you untether yourself from the need to consider any objective measurements and your personal opinion now becomes the standard, you are free to determine any level of compensation that you believe is commensurate with the “responsibility.”
I do not have any information on the details of this allocation study that the city is conducting. The mayor and Councilor Nuttall indicated that they remain open to new information other than the Auditor’s opinion. I would suggest that the consultant and city council review Chapter 10 Section 41 of the city charter which states in part that water fund revenues shall only be used “For the payment of the costs of operation and maintenance of the city water supply system.”
The city by allocating 90 percent of the public works director’s salary from the water fund has made the policy decision that he is the manager of the city water utility. To the extent that the city manager provides some supplementary operational assistance and general supervision of the utility would justify an allocation of 10-15 percent for this responsibility. This would be consistent with the vast majority of Oregon cities with organizational structures similar to Manzanita. There is no justification to provide an assistant city manager in Manzanita with any funding from the water fund.
The voters of Manzanita have approved the city charter as to how they want water fund revenues used and this voter approval supersedes opinions of individual councilors or consultant recommendations.
Please keep up to date on this issue and attend future council meetings when this subject is to be discussed.
Randy Kugler is a former Manzanita city manager