Phoenix City Manager Pay Raise

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The Phoenix City Council recently voted to give City Manager David Cavazos a $78,000 pay increase. Arizona Republic Columnist Laurie Roberts explains why she thinks the 33% pay raise should be reconsidered.

Ted Simons: Good evening, and welcome to "Arizona Horizon." I'm Ted Simons.

Ted Simons: The Phoenix city council recently voted to give city manager David Cavazos a $78,000-a year raise. That's a salary increase of 33%, and it's led to quite a bit of controversy. Among those, none too pleased with the pay increase, is Laurie Roberts, a columnist for "The Arizona Republic." Good to see you again. Thanks for joining us.

Laurie Roberts: Glad to be here.

Ted Simons: OK. Let's get some facts out here. A 33% raise, takes him to what?

Laurie Roberts: His raise will take him to $315,000 a year in base pay. But don't forget, he also as one of the executives in the city, has a deferred pay program, which is based on a percentage of his base pay. So it will also mean an additional $8600 maybe give or take $50 in there, about $8600 more in deferred pay. It is really more like a raise of my math is not that good, journalist here, $86,000 total. That's the amount of the increase.

Ted Simons: And this doesn't include, we have a car allowance as well?

Laurie Roberts: He gets $600 a month in a car allowance, about $7200 a year. A yearly longevity bonus.

Ted Simons: What does that mean?

Laurie Roberts: That's what they say when you're at the top of your pay scale and they can't give you any more, though I didn't know a city manager evidently is never at the top of his pay scale, but for other employees, for mere staffers, they will give them a once a year bonus what they call a longevity bonus to keep you. So you don't -- Once you've topped out. He gets a $4,000 longevity bonus, the $7200 car allowance and now with this raise it will be about a deferred paid plan of about $35,000 a year.

Ted Simons: OK. Why do you think this pay raise is wrong?

Laurie Roberts: I think it's wrong on a couple of levels. A couple years ago the city employee groups were all asked to take pay and benefit cuts totaling 3.2%, and they went along with that to help the city because they had budget problems. Things got better about half of that was increased. But they still haven't gotten the rest of that back of the it seems wrong to me you're giving raises of this magnitude when you have not yet restored fully the pay and benefits of your employees. The people you and I see on the streets, the guy that picks up the garbage, the person who fills the potholes. The police officer that comes when I call 9-1-1. Let's make those people whole first. Secondly, the city of Phoenix, if you remember, told the city's citizens they were going to pay a 2% food tax. Until you get rid of that food tax, you have no business, none, giving a raise of this magnitude.

Ted Simons: OK. The city says Mr. Cavazos's reforms have already saved the city about $59 million.

Laurie Roberts: That is apparently true. And I say good for him that. Was his job. Good for you, you did it and you did it well.

Ted Simons: And the same thing with now your editorial board, the paper came out with an editorial saying that Cavazos's earned this increase because he led the city from a multimillion dollar deficit to a surplus and that he met performance goals, and that's how you deal with these things.

Laurie Roberts: I might add that I don't think he led them alone. I think there were a few rank and file employees right there with him doing what they could. I have no criticism of Mr. Cavazos's -- The way he does his job. My problem is with the scope and scale and the sheer magnitude of this raise. Keep in mind, the average -- The median household income in the city of Phoenix is just under $44,000 a year. His raise, the increase that he got is twice that. It's just unbelievable.

Ted Simons: So for those like the city, like the "republic" editorial board who say you have to pay these people commensurate with what they could maybe find on the open market, or at least pay them what they're worth in order to keep good people.

Laurie Roberts: Then I say let him go test that open market. See how many jobs out there offer this sort of pay and benefits. And remember, not -- We didn't even talk about this, but along with this pay increase that will boost his year -- His lifetime pension. By a great deal. Tell me another place other than CEO of a major corporation where you're going to get that kind of money. If he needs to test the market he should test it. I would certainly say in better times, when there's no food tax, when you're not taxing people for their groceries, when employees have been made whole, then there's a time to say are we paying a competitive rate to keep this guy? Certainly I think we should pay a competitive rate. But we're going to be paying more than to my knowledge, any other city with this form of government with a council city manager form of government, other than San Antonio.

Ted Simons: So you see this both as the wrong move at the wrong time, A, and B, maybe a little bit of tone deafness going on here?

Laurie Roberts: Complete lack of tone deafness. One of the things they told me -- I even underestimated these people. That's hard for me to do. Last week Sal Diciccio, I asked, when did this pay raise take effect? He said it takes effect in July. I assumed they meant the coming fiscal year July 1. No. They made it retroactive to July of 2012.

Ted Simons: I was not aware of that. Interesting. Another argument is, yes, he could test the open market, but if he were to leave, the cost of replacing him, considering what this position pays, might be more expensive than going ahead and paying him retroactively or nonetheless, paying him now.

Laurie Roberts: There's right and there's wrong. I'm really surprised Mr. Cavazos is this tone deaf, that he doesn't see. Go out to west Phoenix and see how people are living. Go down to south Phoenix and see how your residents are living. It's a time and a place thing. And a 33% raise is just outrageous. If he is below market, let's bring him up in an appropriate fashion. I don't know that you have to be the number two highest paid city of our size cities with the kind of government we have, but sure, I don't begrudge the man making more money, but you can't tell me you're going to be giving 33% raises to the rank and file this year. And you can't tell me they're not doing a good job.

Ted Simons: So, in other words, should the city handle this in a different -- Stair-step the up crease, gradually bring it in? Are you saying 33% is 33% too much?

Laurie Roberts: I think it's 33% too much right now. When you have people paying that food tax. I would say whatever raises are anticipated for city employees this year, he should get the same. The city of Peoria, I think it's Peoria, just raised their city manager's pay, they raised it 2.5%. Who's getting 10% raises anymore?

Ted Simons: Not me.

Laurie Roberts: Not me.

Ted Simons: The city of Mesa is looking at increasing the mayor's salary from $38,000 to 70,000. That's a healthy increase, though some would argue 70,000 for the mayor of a city of size of Mesa is still not all that competitive. And the council is going from 19,000 to 35,000. So in terms of percentages, there's a lot of government workers getting some increases out there.

Laurie Roberts: I really want to get a job where I can vote to raise my own pay. That's my dream job. Because I think I'm worth a whole lot more than I'm paid now. The city of Mesa got this idea that since nobody ran for the Mesa city council, clearly this is a job that nobody wants. Therefore we better raise our own pay. The legislature would do the same thing if they could, they're just precluded from doing it by state law. I would agree that for a part-time city council position, maybe they should be paid more. I'm not convinced. Maybe the mayor, but these are all strong city manager forms of government. I don't know what Greg Stanton makes in the city, I shudder to think, but I don't know I would say it would be much more than 70 or 80.

Ted Simons: Not in the 300,000 range we're talking about now. And again, correct me if I'm wrong, this was the same gentleman that was disciplined at one time for travel expense curiosities, correct?

Laurie Roberts: He was. He was disciplined because he was overseeing a manager in a department where they just had all kinds of crazy things going on with people, you know, taking management trips, safari and other trips as part of the aviation department. He was one of several who were suspended for five days and like three months later he was promoted to deputy city manager. So go figure.

Ted Simons: Last question here -- Are you surprised, and don't go too far with your editorial board, but we can talk about that if you want, the paper, a guy like Sal, who is supposed to be such a fiscal hawk, that city council seems enthralled with Mr. Cavazos. Are you surprised so many folks think this is a swell idea?

Laurie Roberts: I don't think that many folks think it's a swell idea. I think the newspaper's editorial board thinks it's a swell idea. I think Sal Diciccio and seven other members -- Sal and seven other members of the city council think it's a swell idea. But the people I'm hearing from, they don't think it's a swell idea at all. I think it's outrageous, and I agree.

Ted Simons: It's good to see you again.

Laurie Roberts: You too. Merry Christmas.

Laurie Roberts:Columnist, The Arizona Republic;

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