Tuftonboro Town-Employee Compensation

Last week the Tuftonboro selectmen voted to give town employees a 3.5% raise. This will consist of a 2% merit raise if the employee receives a positive performance review, in addition to a 1.5% Cost of Living Adjustment (COLA). The COLA is pegged to the Consumer Price Index of northern New England, which changes from year to year. Most people who work in the private sector do not receive an automatic COLA raise. But public employees are to receive these raises, in addition to merit raises. Selectman Carolyn Sundquist stated on August 15, “There is no doubt in my mind that anyone with a satisfactory [not positive] review will move up a step” in the compensation schedule — meaning that employees will receive a raise.

When I asked the selectmen whether town employees who did not receive positive performance reviews would receive a COLA raise, Selectmen Bill Marcussen replied yes. In other words, according to Marcussen, all town employees will receive automatic raises even if they do not receive positive performance reviews. Indeed, on August 15, Marcussen stated, “In an ideal world, we would always like to give people as much more money as we can.” After I pressed them, the selectmen conceded that town employees should not receive raises if they receive poor performance reviews.

As a reminder, what Tuftonboro spends on public-employee compensation increased by 15% last year, following our Town Meeting vote. It now totals $1.6 million annually. At the time, I suggested that if we wanted to give our employees raises, we should do so — but that we should simultaneously cut spending elsewhere in the budget. Carla Lootens, chairman of the budget committee, emphatically stated at Town Meeting that there was “no fat” to be cut from the budget. The 2016 budget appropriated 9% more than Tuftonboro spent in 2015.

According to the NH Bureau of Employment Security, the average income for an individual in Tuftonboro is $33,143. The average total compensation of a full-time employee of the town of Tuftonboro is about two and half times higher than that: $84,910.

You can request a public document titled “2016 personnel administration” from Karen Koch at selectmen@tuftonboro.org to see for yourself. This document shows that the average full-time public employee receives approximately $84,910 in total compensation. I’m using “total compensation” instead of “salary” because total compensation represents the cost to the taxpayer for each employee. For instance, one full-time library employee currently receives a $41,933 salary, but his true cost to the taxpayer is $59,533.50. During the meeting, I stated that the average full-time public employee receives around $70,000 in compensation. After speaking with Selectman Lloyd Wood during the meeting, I realized that I had erroneously included two part-time library employees as full-time employees.

In her article about the Tuftonboro selectmen’s meeting, Elissa Paquette wrote that my conversation with Lloyd about public employees was “not clear.” I know it was unclear to Elissa during the meeting, because she asked me to clarify—which I did. You can watch the video of our exchange judge for yourself whether I explained it clearly.

As I stated repeatedly at the meeting, I am not questioning whether any particular employees deserve the salary and benefits that they are currently receiving. My question is this: Is it sustainable for a small town like ours to pay our town employees more than twice what the average resident earns? And if we wish to do so, shouldn’t we trim the budget elsewhere to keep costs from ballooning over time?

This post has been submitted as a letter to the editor of the Granite State News, and should appear in the September 1, 2016, edition.

Bill Co-Sponsored by Glenn Cordelli Signed into Law by Governor Hassan

Glenn Cordelli HB 645Tuftonboro’s state representative, Glenn Cordelli, attended a signing ceremony for HB 645 recently. Cordelli co-sponsored the bill, which is also known as Willa’s Law, named after a four-year-old girl who died in an unlicensed day care. The bi-partisan bill changes state law to make it a felony, instead of a misdemeanor, when negligence causes severe injury or death. It also requires day cares to be licensed.

Glenn Cordelli
Glenn Cordelli
Asked for comment, Cordelli said, “This is a great example of why I enjoy serving in the New Hampshire House as your representative. After the tragic death of this little girl, we discovered a loophole in the law that we were able to remedy. It makes the time and effort worth it.” Cordelli represents Tuftonboro, Moultonborough, and Sandwich in the New Hampshire house of representatives and is running for re-election in the upcoming September 13 state primary.

Selectmen Vote to Increase Public Employee Salaries

The Selectmen voted unanimously to peg the public employee pay schedule to the consumer price index (CPI) for northern New England put out by the federal bureau of labor statistics. The schedule of raises is currently set out in 2% steps. Under the selectmen’s scheme, the schedule will be adjusted each year. This year the CPI shows a 1.5% increase in inflation. That means that any public employee receiving a raise will get a 3.5% raise. 2% under the pay schedule and 1.5% as a cost of living adjustment raise (COLA).

In public comment I asked if public employees would receive a COLA even if they did not receive a merit-based 2% raise. At first, selectman Bill Marcussen said yes, that all town employees would receive an automatic COLA raise each year, so long as the CPI showed an increase. However, after I asked a few more questions, the three selectmen clarified that only employees who receive positive performance reviews will receive raises.

Hypothetically speaking, if every public employee in town receives a 3.5% raise this year, that will increase the budget line for salaries by roughly $38,500.

The per capita income in Tuftonboro is $33,000.

Selectmen’s meeting for August 22, 2016

In a marathon 3 hour meeting the Tuftonboro, NH, Selectmen covered a variety of issues. They met with summer resident Tom Hall about a proposed crosswalk on Route 109 at 19 Mile Bay. They voted to give town employees near-automatic cost of living raises. They also met with Lakes Region Computer about updating the town’s computers. They also received reports from the fire chief, Adam Thompson, and the police chief, Andrew Shagoury.

Selectmen Refuse to Allow Public Input on Possible Cost of Living Adjustment Raises

The selectmen will be discussing a cost of living adjustment (COLA) raise at their meeting on Monday, August 22, although you would not know that by looking at the meeting’s agenda, which has no mention of a COLA. When I asked Karen Koch, the selectmen’s secretary why there was no mention of the COLA, she replied in an email that the COLA discussion was covered in the agenda by “Continued Business.”

The selectmen discussed a proposed COLA at their work session last Monday. At the time they tabled it saying they needed more information. Selectman Lloyd Wood closed the discussion by saying, “We invite the public to contact us if they have a question.”

I requested to be on the agenda for the meeting on Monday the 22nd, so that I could share my concerns about a COLA with the selectmen, but Koch told me in an email, “Selectmen will not entertain outside input during the meeting before they vote.” I pointed out that it seemed to me that Selectman Wood had invited public input. Koch replied, “I have asked again and the answer remained the same.”

Employee compensation in the budget amounts to $1.6 million, accord to Selectman Wood. That breaks down to $1.1 million for wages and $562,000 for benefits. A (hypothetical) 2% across the board increase to wages would represent a $22,216 increase in the budget for the wages line item. Wood was discussing a hypothetical merit raise increase for every single employee. Selectman Carolyn Sundquist said that there was “no doubt” in her mind that every town employee who receives a satisfactory performance review would receive a step increase on the salary schedule. Every step is a 2% increase.

Selectman Bill Marcussen stated that anecdotally he has observed that the cost of oil is down. Wood stated that he knew that inflation is less than 1%.

Despite this, the selectmen will apparently be voting on giving town employees automatic raises in the form of a COLA, separate from any merit raises, which themselves are virtually automatic, according to Sundquist.

According to the most recent information available from the Economic & Labor Market Information Bureau, NH Employment Security, the per capita (average per person) income in Tuftonboro is $33,143.

Yet the average income of a town of Tuftonboro employee, including benefits, is $52,131. Update: Removing the part-time public employees reveals the average full-time average compensation of a Tuftonboro employee to be $71,446

Keep in mind that the $33,143 figure includes the town employees who live in town. If the public employees were excluded, it’s likely that the per capita income for private sector workers in Tuftonboro would be less than $33,143, making the disparity between public and private even greater.

As a reminder, the Wages line item in the town’s budget was increased this year by 15% at Town Meeting. At the time, I suggested that if we thought that public employees deserved (collectively) a 15% increase that we should give it to them, but that we should find savings somewhere else in the budget. The budget was raised by 9% over what had been spent in the previous year.

Minutes from Selectmen’s August 1, 2016, Meeting

The draft minutes for the Selectmen’s August 1 meeting have been posted to the Tuftonboro town web site by Administrative Secretary Karen Koch. Here is the portion of the minutes that deals with the Lang’s Pong Road construction contract:

The Selectmen revisited the Lang Pond Road award of bid and invited Jack Parsons to participate in the conversation. Selectman Marcussen shared his opinion that his vendor choice is still the same. He reaffirmed that Integrity Earthworks is inexperienced in this area.

Selectman Wood shared his formerly mentioned research regarding RSA 447:16. His opinion is to let Integrity Earthworks add a bond if it is legal and acceptable or to reject all bids and redo the process.

Chairman Sundquist’s opinion stayed the same. She doesn’t feel that the Selectmen’s reasons are strong enough to not move forward with Integrity Earthworks if they present a performance bond.

Jack Parsons confirmed that no official prequalification process was done. Although, none of the applicants were on the State approved contractor list. His recommendation is based on experience. He researched Integrity Earthworks past projects but did not find any solid evidence of past experience applicable to this project.

There was some discussion about the bond requirements, bond amounts, and the low bidder’s confirmation that they would post a bond if required. Jack Parsons expressed concern that he doesn’t want to have to use the bond. Selectman Marcussen explained further that a bond protects the Town in the event of non-performance but it doesn’t get the job done in a timely manner. Selectman Wood added to this explanation stating that a bond is an insurance policy.

Chairman Sundquist doesn’t feel that the chance of non- performance is reason enough to not accept the lowest bidder. Selectman Marcussen feels the opposite as the lowest bidder doesn’t have any demonstrative experience in this area. Selectman Wood shared that he also doesn’t believe that the reason to reject Integrity Earthworks is enough. He is most comfortable rejecting all bids, and redoing the process. It was then discussed amongst the group that the only issue with redoing the process is that all bidders know the other offers at this point.

Selectman Wood made a motion to stand with the original motion of the original bid, seconded by Selectman Marcussen. Vote passed 3-0. Chairman Sundquist voted yes with hesitation. It was asked that Karen Koch relay this decision to Integrity Earthworks.

And during public comment:

During public input, Betsy Frago asked about Norway Plains’ responsibility in regards to the review of the Lang Pond Road bids as well as questioned if Norway Plains reviewed the Invitation to Bid packet. Chairman Sundquist confirmed that Norway Plains did make mention that a performance bond was not included on Integrity Earthworks’ bid but also didn’t know if it was required or not. The Selectmen didn’t know if Norway Plains was provided the Invitation to Bid packet for review. Chairman Sundquist shared that none of the people involved in creating the Invitation to Bid packet were aware that a bond was required until after the submissions were received. Ms. Frago also questioned why Selectman Marcussen was not available to attend the meeting Friday with Integrity Earthworks. Chairman Sundquist explained that Selectman Marcussen was originally available to attend but circumstances arose that prevented him from staying. Although Integrity Earthworks has not indicated that they would sue the Town, she asked if NHMA was asked if the Town can be sued for not taking the lowest bid. Chairman Sundquist responded that they did not inquire about this and this is a concern of hers as well. Ms. Frago also asked about the cost difference between the lowest bid and the second lowest bid. The Selectmen explained that it is approximately a $30,000 difference.

 

Minutes from Selectmen’s Meeting of Friday, July 29, 2016

The draft minutes from Friday’s meeting between Selectmen Carolyn Sundquist and Lloyd Wood and representatives of Integrity Earthworks has been posted on the town’s web site by Administrative Secretary Karen Koch:

Chairman Sundquist and Selectman Wood met with Steve Pacsay, owner of Integrity Earthworks and their estimator, Doug Phillips. (Selectman Marcussen was unable to attend this portion of the meeting.) Mr. Pacsay asked to meet with the Selectmen to express his concerns of their recent decision on the award of the Lang Pond Road project and to get a further understanding for the basis of Integrity Earthworks’ bid being rejected. He read aloud his email that he sent to the Selectmen. The verbiage in the bid requirements did not require a bid/performance bond for the project, which his company is willing to provide if required. He understands that when his company asked if they could add the cost of the bond to their bid they were denied based on the question of whether it was legal or not to do so. He expanded upon his previous management/supervisory experience in the heavy construction industry with degrees of difficulty, deadlines, and dollar values far in excess of the Lang Pond Road project. He views this project as a critical stepping stone in the growth and presence of his company and stated that this was considered part of the strategy when placing a value on this project. He expressed his confusion on the outcome of the decision made and is contemplating to what degree his company wants to pursue this matter. He asked that the Town research the legality of the decision that was made prior to final contract award. Integrity Earthworks feels strongly that the fair thing to do would be to reject all bids, revise the bid requirements and restart the bid process.

Chairman Sundquist expressed her agreement with Mr. Pacsay and explained that this is why she voted against awarding the bid to LA Drew. She proceeded to read aloud Selectman Marcussen’s statement. His primary reason for not supporting award of the contract to the lowest bidder is that he doesn’t believe that the low bid is “responsible.” Doug Phillips responded by stating that no pre-qualifications were asked for as part of the process therefore all bidders had to assume that they were qualified. Mr. Phillips went on to explain that 25% of their business is in much larger commercial projects and their bid form references such. They feel that they are very qualified for this project. Mr. Phillips commented that Selectman Wood stated that the RSA was clear on the requirements of a performance bond over $35,000 but didn’t know of a solution without redoing the paperwork. Mr. Phillips feels that the process should be redone and a pre-qualification process done for each bidder. Mr. Pacsay explained that he is aware of the perceived capacity of his business within the community, so when he knew that his company had the low bid he reached out to Jack Parsons twice (as well as Norway Plains) and asked to meet with him and the Selectmen, if necessary, and it was denied both times, stating that there was no need to do so. Mr. Pacsay expanded on his past experiences of large responsibility pertinent to this type of project.

Selectman Wood thanked them for stepping forward and complimented Mr. Phillips in terms of acting as their agent. He feels it is important to stay fair and open. He spoke of RSA 447:16 and the notes of the decisions that were made in terms of this RSA, particularly #4 Bond-Generally, given that a general contractor was required to obtain a bond under RSA 447:16, which bond stated that if there are conflicts between the terms of the understanding and the statute, the statute should be resolved in favor of the statute and #7 Bond Provisions, this section did not require the terms of the bond required to be read into a contract with the Town. His reiterated his duty is to follow the letter and spirit of the law. He said that the Town cannot, after putting one set of specifications out to bid, decide to accept a bid and then calculate it differently. Although he confirmed that they can be rejected legally. He also read aloud the minutes of the July 26, 2016 meeting where Mr. Phillips noted that they feel that their interpretation of the bid form should not slow the process of the project and they are happy to accept the Board’s decision without recourse or any question. Mr. Pacsay acknowledged this.

Chairman Sundquist read the motion that was made by Selectman Marcussen at the July 26th meeting bringing attention to the point that the motion made was not a result of the bond not being included.

Selectman Wood moved that the Selectmen reconsider their actions taken in terms of awarding the Lang Pond Road project, seconded by Chairman Sundquist. Vote passed 2-0. The Selectmen will reconsider their decision at their Monday morning meeting.

Mr. Pacsay stated that he is not asking that his company gets the job. He is just asking that the Town redoes the bid process and makes the bid process clear.

(Emphasis added.)