In September, the City of Grand Junction offered a voluntary labor reduction incentive program to City employees in an effort to help partially offset the continuing decline in revenues. In mid-October it became clear that involuntary labor reductions would also be needed.
City Manager Greg Caton states, “As we moved through budget development for 2017, it became clear that we were facing not only a cyclical deficit (boom and bust), but also a structural deficit (permanent). Because our operations are primarily service, in order to make the necessary adjustment to our expense budget, we had to turn to labor reductions.”
The voluntary labor reduction program resulted in six employees who applied and were approved to take part. Criteria for the voluntary program (which offered temporary unpaid leave of absence, early retirement incentives, voluntary separation incentives, or voluntary hours reduction) required that the positions needed to be ones that would not need to be backfilled.
The financial impact of the six authorized voluntary labor reduction applicants was not nearly enough to address the revenue shortfall so as a result involuntary labor reductions were implemented across the organization with the exception of the public safety departments (police, fire and the communication center) where new critical positions will actually be added in 2017 and most enterprise fund divisions (those that are fee-funded and operate as self-sustaining business units). Enterprise funds are not dependent on sales tax and so are not typically impacted by sales tax revenue shortfalls.
The involuntary labor reductions are being implemented in addition to the voluntary reductions as well as the elimination of a number of positions that over the course of the last several months had not been filled following normal attrition.
For 2016, numerous modifications to the budget as well as operational changes have been made to address revenue shortfalls. Revenue projections for 2017 are not anticipated to improve and the proposed budget was prepared with a $1 million labor reduction line item in order to fall within expected revenues. The labor reductions have achieved the $1 million target.
The 2016 adopted budget includes 641 regular full-time employees with 430 of those funded through the General Fund.
Organization wide 31 positions were impacted as follows:
- Six voluntary reductions
- 10 vacant position eliminations (not filled following attrition)
- 15 involuntary reductions (ranging from layoffs to position reclassifications)
Impact by department is as follows (inclusive of voluntary reductions, involuntary reductions and positions eliminated following natural attrition):
- Nine changes in Administration
- Five changes in Community Development/Planning
- Two changes in Convention and Visitor Services
- One change in Fire (non-sworn position, vacancy not filled following attrition)
- One change in Police (non-sworn position, voluntary hours reduction)
- Seven changes in Parks and Recreation
- Six changes in Public Works
Reductions by category:
- Three reduced hours or leave of absence
- 24 positions eliminated (inclusive of voluntary reductions, involuntary reductions and positions eliminated following natural attrition)
- Four positions reclassified or reassigned to an Enterprise Fund division
City Manager Greg Caton states, “This has been a challenging process for staff and certainly the individual employees involved in the reduction. I am confident we have done what is necessary within the labor budget to correct the structural deficit and move forward into the new year on solid footing.”
Most labor reductions will become effective December 16, 2016.