Wednesday, February 28, 2007

Secondary Employment Just Won't Go Away

The long-rumored settlement between the City of Pittsburgh and Deven Werling is just about complete. And it's going to cost us at least $200,000. As the Post-Gazette's Rich Lord is reporting this morning, the city has agreed to settle the legal case which formed the centerpiece of Part I in my recent series of posts concerning the Pittsburgh Police Department's secondary employment policies. We commoners are paying $200,000 -- plus countless amounts of money for legal fees -- for something that one of our police officers did on his own time, while he was working under the table and evading the very taxes that will now go to pay for his mistakes. And to think that some of you were wondering why this secondary employment story is such a big deal.

The Post-Gazette story contains an enormous number of things that simply must be examined and commented upon. So let's get started, shall we?

The city of Pittsburgh is paying $200,000 to settle a lawsuit stemming from a police sergeant's actions while working a side job.

The federal lawsuit was filed by Deven W. Werling of Largo, Fla., who said he was roughed up by Sgt. Mark A. Eggleton at the Original Hot Dog Shop in Oakland in 2004. The city's Office of Municipal Investigations found that Sgt. Eggleton contradicted himself under oath, and he was fired.

In October, the dismissal was reduced to a five-day suspension by then-Operations Director Dennis Regan. Mr. Eggleton continues to work as a Sergeant.
If anyone ever again wonders why Dennis Regan was such bad news, and why his nomination by Interim Mayor Luke Ravenstahl as Director of Public Safety elicited so much outrage throughout the city, please direct their attention to this particular set of facts. They really say everything that needs to be said. Remember, this is the man whom Master Ravestahl has claimed did "nothing wrong" during his time in city government.
Mayor Luke Ravenstahl said he wasn't familiar with details of the case, and that the Law Department handled the negotiations. Mr. Werling was represented by Timothy P. O'Brien.
This one case is going to cost his constituents more than twice Master Ravenstahl's annual salary, and yet he says that he doesn't really know why. Maybe he should make it his freaking business to find out. In fact, I'll make it easy for him. He can just click right here and read an excellent summary of the whole thing. And then, just maybe, it will begin to dawn on him why it was unforgivably stupid of him to eliminate the very cost recovery program that was designed to cover settlements like this one. Instead, his spineless capitulation to the Fraternal Order of Police leadership has left city taxpayers stuck with the bill.
Council received a resolution to approve the settlement yesterday, and could vote next week.
If City Councilmember William Peduto doesn't take the opportunity to ask some very pointed questions about this resolution prior to voting on it, then I'm going to begin rapidly losing respect for the man. As one of his constituents, I certainly want to know what the city is doing to make sure that the taxpayers don't get left holding the bag for these kinds of lawsuits in the future. As a voter, I want to know exactly what kind of cost recovery plan would be implemented under his administration if he wins this year's election and becomes our city's next mayor.
The Eggleton case highlights what the city considers to be problems with the way security assignments are handed out.

In November, Mr. Ravenstahl shelved a plan to charge businesses $4 or $5 an hour, on top of the $38 an hour they pay the officers, for the scheduling of side jobs. The fee was supposed to cover costs including those stemming from lawsuits like the one involving Sgt. Eggleton.
And now that we are no longer collecting that fee, just where will this $200,000 come from?
Last week, Police Chief Nate Harper said his bureau is still trying to get control of the assignment of side jobs, two years after it started to wrest that duty from entrepreneurial officers who have long handled that role. He said the city hopes it will be scheduling all such assignments by April 9.

Yesterday, the mayor said he saw "no reason why we can't meet that timetable," but would not say exactly what would be achieved by then.
Classic Ravenstahl maneuver here. A generally positive and agreeable statement, but an absolute refusal to commit to specifics.

There are two important things to keep in mind as we move forward into the next few months. The first is that the interim mayor has committed -- in his usual, weaselly, non-specific way -- to meet this April 9th deadline for the Special Events Office to take control of all secondary employment. If he hasn't done it by then, we deserve to hear about it, and we deserve an explanation for his failure.

Secondly, this case proves that the FOP-proposed cost recovery fee of just $2 per hour is ludicrously inadequate. It won't bring in enough money to cover everything that stems from just this one settlement, let alone all of the other costs that secondary employment currently passes along to the taxpayers. Whenever the mayor gets around to reimplementing the scheme that he eliminated last November -- that would be by April 9th, right? -- the cost recovery fee had better be high enough to actually cover the taxpayer's costs. We will be watching.


Rob Carr said...

You need to check your facts. You say "...for something that one of our police officers did on his own time, while he was working under the table and evading the very taxes that will now go to pay for his mistakes."

This is incorrect. The officers are working overtime, through their bargaining unit and under the auspice of the City of Pittsburgh. They are paid by the City as part of their regular paychecks, and the taxes are taken out of the money they earn. The way things work, if you do occasional overtime like this, too much tax is taken out of your paycheck, as you are usually bumped up to a higher tax bracket that the average pay doesn't sustain.

Paramedics had the same basic routine as the City. When medics work at sporting events, concerts, road races, or other events, they bid on each event. Events are handed out according to a bid process FAPP and the City agreed to that involves seniority. Long term members work the field at Steeler games, new folks work the Monster Truck pulls.

Payment for the OT shows up in the next pay cycle it's entered for. It's not under the table.

This process helps the City to assign public safety costs for locations and events, and in theory makes sure professional personnel are on hand and taking care of the public.

What the officer did was found to be wrong, and yes, the City had to pay for it. The same would have happened had he behaved improperly on regular time.

To characterize this payment as tax free and "under the table" shows that you should do a bit more research before you spout off.

Rob of UnSpace

Anonymous said...

The "outside the system" off-duty details are completely free from reporting.

They can be under the table. Less than 10 percent of the details were reported last year, by some estimates.

Anonymous said...

Outstanding post. I could not agree with you more. I think Officer rob is missing the point (in addition to being wrong about a few facts). No question that this example chystalizes what is wrong with the Reganstahl administration and presents a big opportunity for Peduto. Bob.

Richmond K. Turner said...

Well, since you keep posting this claim all over the burghosphere, I guess I will just have to keep posting my response everywhere as well.

I have the court filings in the Eggleton case. The work done at the "O" that night was most certainly under the table.

Remember, this incident took place some years ago. This was well before there was any kind of plan in place for the city to control these off-duty side jobs. The "O" hired these officers. They didn't go through the city to hire them. At best, they went through one of the other police officers who has a contracting firm to provide other police officers as security guards. But the "O" didn't go through the city to hire these officers, and in 2004 there was no way that they could have done so.

No money passed through the city's payroll system. The court filings in the Eggleton case clearly and unambigiously state that the two officers were working on a cash basis that evening. From the expert witness testimony:

On August 29, 2004, Sgt. Eggleton and Officer Roberts were employed full-time as police officers with the Pittsburgh Police Department. However, at the time of the incident with Mr. Werling they were working off-duty at The O in a security capacity, but in full police uniform (including uniform shirt and trousers, hat,, badge, shoulder patches, baton, firearm, and other police accessories) and were being paid $24.00 per hour "under-the-table".

The paramedics may have worked in the way that you describe -- through the city payroll system -- for years. I don't know. This story isn't about paramedics. It's about police officers, and they -- even now -- only work thorugh the city payroll (at best) 39% of the time. So don't accuse me of not doing my homework. Especially when you clearly haven't done yours.

By the way, I checked out your blog. You seem like a nice enough guy. I'm betting that there is a great deal that you and I would agree upon. So I really can't figure out why you would go out of your way to insult me in this way.

If you want to ask a question, ask it. Ask me, "Are you really sure that they were working under the table?", and I'll give you the polite answer that you deserve. Accuse me of not doing my research on a point that is this important, however, and you relinquish any right to courtesy from me.

Anonymous said...

Rob - You couldn't be more wrong. As in so many other aspects, the paramedic scenario is nowhere near as lucrative as the police scenario. For example, the average cop detail pays $37.54/hr. or $25/hr. under the table. Paramedics don't get anywhere near this amount. While you can't name a single paramedic who "runs" off-duty paramedic work, any cop can identify 4-5 cops who "run" off-duty cop work, in addition to the work run through the City. Finally, no paramedic charges a private employer a fee to schedule fellow paramedics for off-duty work. Ask Sgt. John Fisher (who will be made a commander right after the primary as a reward for not telling the world what an obnoxious child Luke can be when he's drunk) how much he charges to schedule his hundreds of details.

EdHeath said...

Well, Rob mentions being a paramedic on his site, so that would likely explain the confusion. It may even be that some police details work the way he says, for events such as “sporting events, concerts, road races, or other events” where both a police presence as well as a paramedic presence is desirable. Although I should say that at least some of the police presence at ball games is clearly not there on overtime, as we know from the stories in various papers, not to mention from this blog. Also clearly the officers in uniform patrolling bars, the “O” or the Giant Eagle(s) are not there on overtime, indeed, that would be a poor use of scarce payroll dollars for the city to pay officers overtime to stay in one place. The previous commenter probably hit the nail on the head, that the off-duty police are paid a lot more than special duty paramedics, and the police union is attempting to keep the jobs away from city control.

By the way, paying the officers cash is not absolutely a tax dodge. Paying them as an “independent contractor” is perfectly legitimate, as long as it is properly recorded as an expense for the payer. If they are paid less than $600 in a year no notification to the IRS is required; if they are paid more than $600 the payer is required to send a 1099 (misc) to the IRS and the “independent contractor”. The “independent contractor” is then basically a small business in the eyes of the IRS, will be taxed on federal, state and local taxes and social security and medicare, and can claim expenses (bullets, dry cleaning to remove the blood stains, etc). All this is neither here nor there, except to say that a cash payment is not absolutely a tax dodge … just *almost* absolutely.

Smitty said...

There is a lot of fall out over this Eggleton case that happened prior to Fluke Reganstahl's acension to the throne.Wait til the McNeilly settlement is thrown at his feet.How will he dodge that one?.Eggleton should be the appetizer for Peduto;McNeilly the main course.

Anonymous said...

Peduto should challenge Luke to follow-through on his and Harper's claim that they will implement the system by April 9, and the MSM should remain on top of the issue. Also, the MSM should request a breakdown of all of the $ the City lost because Fluke halted the program between November and April 9.

macyapper said...

Dude, you freaking nailed it.


When will the 'Burghers wake up and smell the incompetence?

Anonymous said...

Speaking of incompetence and wastefule spending...what about all of these $10,000+ studies that Billy Peduto seems to always be proposing?

Just today in Council chambers he proposed spending $10,00 for a study on the proposed tax abatement proposal and how it will impact the neighborhoods and problem...this study/work has been ongoing in the Mayor's admin. for some time now...OOPS.

Anonymous said...

"Just today in Council chambers he proposed spending $10,00 for a study on the proposed tax abatement proposal and how it will impact the neighborhoods and problem...this study/work has been ongoing in the Mayor's admin. for some time now...OOPS."

What alternative universe are you living in?

Richmond K. Turner said...

I'm pretty clearly on the record with my criticisms of these endless studies from Peduto. But just becuase he's the one proposing something does not automatically make the thing worthless. There is some value in looking before one leaps; the key question is whether the study you are talking about already exists in some other form.

You seem to indicate that said report is being worked on by the mayor's people. If so, where in the hell is it? They announced their big tax abatement plan last week. Are you saying that they announced their plan before they had really examined the consequences? That's hardly looking before one leaps. That's leaping first, and then feverishly making up bullshit to support a conclusion that is fait accompli. Once again, that's far from a hallmark of quality governance.

But let's assume that everything you say is totally true here. The proposed study is a complete and total waste of $10,000. It still has to be said that those kinds of amounts are chump change when compared to the the half-million that Ravenstahl pissed away when he dismantled the cost recovery fee.

At least with Peduto, the costs are lower. And, when the study is done, the taxpayers actuaally end up with something -- yet another study sitting in yet another binder that almost nobody will every read -- to show for their money.

Grant W. Stapleton said...

"Rob" is just misled a bit. SOME of this off duty security work is paid through the department, but MOST is not, these officers have cut their own deals with businesses, some of which pay 1099 wages, some, such as many of the bars, pay cash under the table, without tax filings.
What everyone here is missing, is that ANY of this work is ILLEGAL, absolutly NO policeman may legally contract out his services as a guard. Read provisions of the Private Detective Act of 1953, that strictly prohibit departments and individuals with police powers from working as a CONTRACTED guard for public employers. This is the REAL story, folks ...l this so called "cost-recovery" is illegal itself .. so eventually the taxpayer will also "eat" the costs of the scheduling software, which will have to go unused.