Mayor slashes pay for all city workers to min wage

[pixy0stix]

Scranton mayor slashes pay for all city workers—including police and firefighters—to minimum wage

news.yahoo.com/blogs/lookout/scranton-minimum-wage-city-police-firemen-140229063.html

Cash-strapped Scranton, Pa., has slashed pay for all city employees—including police and firefighters—to minimum wage, sparking furor among unions that now say they plan to sue in federal court.

A lawyer representing three unions told Scranton's Times-Tribune he will file several motions, including one to hold Mayor Chris Doherty in contempt of court for violating a judge's order to pay full wages.

The lawyer, Thomas Jennings, said he also expects to file a pair federal lawsuits on behalf of the unions—International Association of Firefighters Local 60, the Fraternal Order of Police E.B. Jermyn Lodge 2 and the International Association of Machinists and Aerospace Workers Local Lodge 2305—alleging the city failed to pay proper wages and overtime, and cut benefits for disabled police and firefighters without a proper hearing.

"Pick a law," Jennings told the Times-Tribune. "They violated it."

Last week, Doherty abruptly cut pay for all 398 city employees to $7.25 per hour, saying it was the only way to keep Scranton solvent.

According to the paper, Scranton—which faces a $16.8 million budget deficit—had $133,000 in cash on hand as of Monday, but owed $3.4 million in various vendor bills, including health insurance.

Roger Leonard, a city employee, told NPR he typically gets a $900 check for two weeks of work. On Friday, it was $340.

"I have two children and a wife, and my wife is a stay-at-home mom," Leonard told NPR. "If the savings gets drained, we won't be OK."

The mayor, meanwhile, blamed the City Council for Scranton's financial woes.

"If they'd gone with my budget, we wouldn't be having this discussion," Doherty said. "The taxes would have been raised. The bills all would have been paid because we would have had a dedicated revenue stream."

[penguingrrl]

OMG, that's horrendous. How can they expect people to support themselves and their families on minimum wage?

[dev22]

Let me guess - said mayor did not reduce his own pay to minimum wage, did he?

[pixy0stix]

Jul 10, 2012 16:05:09 GMT -5 dev22 said:

Let me guess - said mayor did not reduce his own pay to minimum wage, did he?

No idea. I'm about to go hunting to see why the city is in such a mess. Unless someone here knows?

[basilosaurus]

So people start putting everything on credit, defaulting on loans, and filing for food stamps. How is this positive?

[charminglife]

If they really want to eliminate expenses the city needs to start laying people off - slashing everyone's salary to minimum wage seems like a publicity stunt because the mayor is pissed the council didn't approve his budget.

[pixy0stix]

Jul 10, 2012 16:08:50 GMT -5 charminglife said:

If they really want to eliminate expenses the city needs to start laying people off - slashing everyone's salary to minimum wage seems like a publicity stunt because the mayor is pissed the council didn't approve his budget.

It could very well be. COsprings was turning off street lights, and not mowing parks, etc. in an attempt to get people to raise taxes.

[secretlyevil]

WTF? This isn't a joke, he did that? :-|

[pixy0stix]

I'm not finding anything more, really. Other than the Mayor is a Democrat as are the City Council members. Which was a really random thing to throw in.

bottomline.msnbc.msn.com/_news/2012/07/10/12659748-scranton-pa-slashes-workers-pay-to-minimum-wage

[y4m]

I smell a plot point for The Office!

[wawa]

Here's a quick blurb about the taxes her proposed to avoid this issue:

wnep.com/2012/05/24/new-taxes-proposed-in-scranton/

This the revenue raising plan the mayor wants to show to the banks. First, some tax hikes for property owners in the city, a 29 percent increase next year, another 20 percent hike in 2014 and then another 15 percent in 2015.

Garbage taxes would go up $11 a year. Scranton residents pay $178 a year now. It would be $200 by 2014.

The mayor also wants to impose a commuter tax for people who come in to the city to work. The tax would raise $1.5 million next year and $3.5 million in 2014.



I haven't found anything to explain how they got into such a tight spot to begin with, except for the fact that scranton generally sucks. I can't imagine they are raking in the dough on property taxes.

[pixy0stix]

I read a blurb that they've been receiving money/loans because of their financial position since the mid-90s? I could be wrong about that, though. Also, part of their problem is that the city is shrinking.

[wawa]

huh. well shit like this doesn't help you run a city:

wnep.com/2012/01/13/3-million-in-forgotten-parking-money-found-2/

Every time you put change into a Scranton city parking meter over the last three years, that money essentially, disappeared.

That money was found this week by the city controller in a forgotten account at Fidelity Bank, an account containing $3 million.

The missing money was called to the mayor’s attention earlier this week when a higher than expected bank statement arrived. The money has been lost for three years, during a time when Mayor Doherty said the city’s become increasingly cash strapped.

“It wasn’t notified to the B. A’s (business administrator’s) office that we were missing it, by auditors and other people. They missed it also,” Doherty said.

The money went directly from the parking meters to the bank to the amount of $700,000 a year. The city budgeted for it each year to pay bills, but it was never spent.

That bank account had a total of $3 million in parking meter money that had been collected over the past tree and a half years.

The mayor said it will now pay for old bills and offset a $9 million loan to pay debt the city already has.

“But of all the things that have happened in the past year, as far as finances in the city, we’re happy to have $3 million to pay $3 million in past bills,” Doherty added.

The mayor said this is good news. Thanks to the missing money the city owes less money, but many city taxpayers are still scratching their heads and questioning the city’s accounting.

[IIOY]

Jul 10, 2012 16:05:09 GMT -5 dev22 said:

Let me guess - said mayor did not reduce his own pay to minimum wage, did he?

Actually, he did. I'm on my phone but check the WSJ article on this.

According to one council member, the mayor asked to raise taxes but city council rejected the plan while not offering up any viable alternatives. Salaries were cut so as to preserve health/other benefits. Apparently some of the financial trouble stems from a massive arbitration award that the city couldn't afford and is trying to negotiate down.

[IIOY]

Jul 10, 2012 16:23:10 GMT -5 pixy0stix said:

Also, part of their problem is that the city is shrinking.

I am positively shocked that people don't want to live in Scranton. It's such a... place.

[dev22]

Jul 10, 2012 16:24:47 GMT -5 IIOY said:

Jul 10, 2012 16:05:09 GMT -5 dev22 said:

Let me guess - said mayor did not reduce his own pay to minimum wage, did he?

Actually, he did. I'm on my phone but check the WSJ article on this.

According to one council member, the mayor asked to raise taxes but city council rejected the plan while not offering up any viable alternatives. Salaries were cut so as to preserve health/other benefits. Apparently some of the financial trouble stems from a massive arbitration award that the city couldn't afford and is trying to negotiate down.

Huh. I take it back then.

I mean, it is still a super shitty thing to do. But at least he did it to himself, too?

[pixy0stix]

Jul 10, 2012 16:28:47 GMT -5 IIOY said:

Jul 10, 2012 16:23:10 GMT -5 pixy0stix said:

Also, part of their problem is that the city is shrinking.

I am positively shocked that people don't want to live in Scranton. It's such a... place.

bwahahaa!

[NitaX]

*shakes her head*
How the hell do you lose $3 million in parking revenue? Lord only knows what other accounts are just hanging out in other banks all willy nilly.

[wawa]

Jul 10, 2012 16:39:22 GMT -5 NitaX said:

*shakes her head*
How the hell do you lose $3 million in parking revenue? Lord only knows what other accounts are just hanging out in other banks all willy nilly.

I think the best part of that story is that they had actually spent that money already - while not knowing where it was. there was just a $3M deficent somewhere in their accounts that nobody noticed.

[Deleted]

Is Dunder Mifflin hiring?

[marynjoe]

Jul 10, 2012 16:08:47 GMT -5 basilosaurus said:

So people start putting everything on credit, defaulting on loans, and filing for food stamps. How is this positive?

Exactly. Tthat city was bad off before, but now they're really screwed.

[NitaX]

Jul 10, 2012 16:56:37 GMT -5 wawa said:

Jul 10, 2012 16:39:22 GMT -5 NitaX said:

*shakes her head*
How the hell do you lose $3 million in parking revenue? Lord only knows what other accounts are just hanging out in other banks all willy nilly.

I think the best part of that story is that they had actually spent that money already - while not knowing where it was. there was just a $3M deficent somewhere in their accounts that nobody noticed.

IKR! I was just like holy hell. WTF. I can't even begin to imagine. The finance chief should be in the hot seat over this.

[iammalcolmx]

DAMN!! That Mayor has balls. Wonder about the number of death threats received over this.

[marie427]

So these people will have no disposable income to spend on anything in Scranton. Great idea!!!

[GailGoldie]

funny- just watched an American Guy episode last night where Stan flips out and is stealing, etc, b/c he had to live on min wage... for 2 days.

[2vermont]

I'm glad to see the unions are on this. I don't see how this can go forward considering it probably goes against the contracts.

[karinothing]

Jul 11, 2012 5:08:55 GMT -5 2vermont said:

I'm glad to see the unions are on this. I don't see how this can go forward considering it probably goes against the contracts.

I have a question though. Even if it goes against the contracts, what else do you do if the money just isn't there. On the news this morning it said they have 5K in their coffers to pay folks. What if no one lends to you anymore? I guess the city has to file for bankruptcy..and then no one gets paid either.

I mean I know they can raise taxes, but that doesn't help things in the immediate.

[SusanBAnthony]

I would guess they have to lay a ton of people off.

The whole thing is very interesting, and I am curious how it turns out.

I wonder what houses are selling for there.

[IIOY]

Jul 11, 2012 6:35:37 GMT -5 SusanBAnthony said:

I would guess they have to lay a ton of people off.

Indeed. I haven't read any follow-up articles on this issue, but my guess is that the mayor chose to slash salaries rather than lay people off because it was the lesser of two evils - everyone keeps their job - while also something he could apply to himself to eliminate accusations that he wasn't suffering along with the rest of the workforce.

If the money and tax base aren't there, they aren't there. This is where I find the whole pension catastrophe fascinating - what, precisely, are governments supposed to do if they cannot find the money to fund them but unions (claim they) won't negotiate for a reduction in benefits and/or pay? You can only tax people so much.

[marie427]

Jul 11, 2012 6:35:37 GMT -5 SusanBAnthony said:

I would guess they have to lay a ton of people off.

The whole thing is very interesting, and I am curious how it turns out.

I wonder what houses are selling for there.

That area has dirt cheap housing. Every summer H and I stay at my ILs lake house for about a week not too far from Scranton and every summer we torture ourselves by taking those real estate booklets at the local supermarket there. The housing prices make us cry every time. It's why so many people these days live in northeastern PA and commute to NYC five days a week for work even though it's a 2+ hour bus commute one-way.