Sunday, March 11, 2007

Cost Recovery: Just LIke a Bad Penny, It Keeps Coming Back

Every time that I'm convinced that the police secondary employment and cost recovery story has gone away, it keeps popping back up. There continues to be a certain amount of public attention on this issue, which more or less began right here in the burghosphere, and the press continues examine it. It may not be the leading story in any paper or on any news broadcast, but it certainly seems to be one of the most long-lasting stories in the recent history of Pittsburgh politics.

The latest installment comes courtesy of Post-Gazette columnist Brian O'Neil, whom I have recently criticized for celebrating the mediocrity of Pittsburgh's Interim Mayor, Luke "Flip Flop" Ravenstahl. But with today's column, Mr. O'Neil seems to be allowing a tiny bit of doubt creep into his formerly rock-solid confidence in Master Ravenstahl's prospects in the coming mayoral election. Mr. O'Neil also seems to be channelling a bit of my own skepticism concerning Master Ravenstahl, so much so that I really have to wonder whether he may have actually read a bit of my own series about this very same issue. At times, reading his column felt remarkably like reading The People's Republic, only with admirable brevity and significantly fewer spelling and grammar mistakes.

What does seem a bit weird, frankly, is that Mr. O'Neil starts off his column with an extended quote concerning secondary employment from a prominent Pittsburgh blogger. But instead of lifting something from the Admiral, Mr. O'Neil consults local attorney Tim Murray, also known as one of the enormously talented writers behind the Carbolic Smoke Ball:

Imagine a pest control worker for Orkin or some such company, and after hours the guy dresses in Orkin regalia and goes out and moonlights, doing private pest-control jobs.

"Pretend he does termite eradication work on his own time, and all the money he earns from moonlighting is his. Orkin has no control over him at night.

"Now imagine a building suffers serious damage from termite infestation from one of these moonlighting jobs (and the dumbbell failed to have the building owner sign a waiver of damage).

"The building's owner, of course, sues Orkin, since it has deep pockets. Would Orkin's board of directors react the way Pittsburgh City Council reacted [Wednesday] regarding the moonlighting cop who was sued -- by overwhelmingly voting to pay a big settlement? The question scarcely survives its statement.''

I can't remember ever beginning a column with that long a quote, but Tim Murray, a Downtown lawyer who has no dog in this fight, is baffled by the system the city has in place. You should be, too.
The analogy use here is remarkably similar to one that I made nearly a month ago, only I used the example of an electrician instead of an exterminator:
Whether in small amounts or large ones, our city government ends up spending money in order to fund and support these secondary employment arrangements. We are bearing much of the financial cost and assuming almost all of the legal liability needed to allow our police officers to run their own private businesses during their off-duty hours.

When you think about it this way, the practice seems quite bizarre. Consider, for example, an electrician who normally works for a large contractor, but who wants to start his own business doing in-home electrical repairs at night and on weekends. You wouldn't expect his regular employer to pay for all the wire, breakers, tools, and other items needed to get this new enterprise off the ground. And you certainly couldn't expect his employer to cover his legal liability. If one of these homes that our electrician works on subsequently burns to the ground due to his shoddy work, he will simply have to face the legal music on his own, unprotected by his regular employer's insurance policy.
Regardless of whom Mr. O'Neil draws his analogous quotations from, the overall point is the same. And it's a good one. The taxpayers should not be required to subsidize the private businesses of off-duty Pittsburgh police officers.

At least Mr. O'Neil presents the issue in a way that should be far more approachable to most readers than my own, excessively long attempt to examine this issue. He also allows Luke Ravenstahl's mayoral opponent, City Councilmember Bill "Cojònes" Peduto, to get in a particularly good statement about where things currently stand:
Mr. Peduto once again flew solo in dissent as council voted 7-1, with Councilwoman Tonya Payne abstaining, to pay the [$200,000] settlement [in a lawsuit stemming from off-duty employment]. The challenger used the occasion to rip Mayor Ravenstahl for shelving a plan last November that would have given the city control over police side jobs -- and more.

That plan included a fee that would cover the cost of administration, lawsuits, settlements and workers' compensation claims.

"If Luke hadn't killed the program, we'd have money in there," Mr. Peduto said later. "Because he did, we have to reach into the taxpayers' wallet and make them pay it."
Mr. O'Neil goes on to dive into some real nuts-and-bolts stuff, including exactly how the cost recovery fee should be structured, and how much the city should charge per hour to eliminate this burden on city taxpayers:
The police bureau would add $4 or $5 to each moonlighting officer's hourly charge, which can reach $38. But the program was suspended amid complaints about the fee structure. Jim Malloy, president of the Fraternal Order of Police, has no problem with the system, just the numbers. [snip...]

[He] thinks a fee of just $2 an hour, on top of the officers' pay, would be fairer to the restaurateurs, bar owners, bankers, jewelers and sports barons who do the hiring. The city shouldn't try to amass its cost-recovery fund overnight.

That seems a reasonable, real-world critique. Councilman Peduto also isn't married any particular figure, though he'd like it to be a percentage rather than a flat fee. That way it won't have to be revisited because of inflation. He suggests 10 percent -- that would be $3.80 atop a $38 hourly bill -- but the rate is less important than the goal.
Mr. Peduto is spot-on-right about this one. As I have noted in an earlier post, this fee would work best if it were structured on a percentage basis, so that it increases as the officers' wages go up over time. Again, it almost seems as though some people are actually reading The People's Republic, and maybe even looking at the detailed financial spreadsheet that has been made available here. I'm so proud!

Mr. O'Neil closes with a question that should be on everybody's minds as we move toward Master Ravenstahl's self-proclaimed deadline to resurrect the program that he has already killed off once before:
Mayor Ravenstahl has said a decision will be made by April 9, date of the Pirates' home opener, but why wait? The next fracas could be one crowded barroom away, and that's a tab the proprietors, not Mr. and Ms. Pittsburgh, should cover.
Why wait? There is only one reason to wait, and it's the same reason why Master Ravenstahl eradicated the program to begin with. He's desperately trying to placate the police union in return for their support in the May 15th Democratic primary. He's hoping against hope that the issue will die down enough for him to get away with not charging any cost recovery fee at all. Baring that, he hopes he can get away with limiting this fee to some all-but-meaningless amount, such as the FOP-proposed fee of just $2 per hour. If all else fails, Interim Mayor Ravenstahl would at least want to exempt the more lucrative security contracts from the secondary employment policy, or set things up using a fixed flat-fee arrangement that will not be indexed for future inflation. He's waiting, in other words, for the rest of us to stop paying attention.

But as Mr. O'Neil's column demonstrates, our attention doesn't seem to be waning. There are far more interesting and important topics available for discussion, but this one continues to command a small bit of our attention on a recurring basis. We are still watching.


Anonymous said...

The (dull) drum beat of the Fluke Raven-Regan adminstration & friends (Motznik) is that the higher the fee, the fewer off-duty employers who will avail themselves of off-duty resources. To this, I say: No shit. Economics 101.

1. The decrease in the number of participants will not be so great as to render the cost recovery program meaningless. Sure, a handful of organizations will resort to cheaper security alternatives on a permanent basis, others only temporarily, recognizing the value and impact of the uniform police presence. Newcomers to the market (Northside in particular) will also offset the decrease. In addition, the increase in tax revenue due to the elimination of "under the table" wages will offset any decrease.
2. To the "gas thief"'s misrepresentation that our "streets will be more dangerous" due to any decreased police presence: (A) With the exception of bar and traffic details, "officer presence" is enjoyed by the paying customers of private employers, not the general public:; (B) NEWSFLASH: It's Fluke and MOtznik's job to assure adequate police presence! Maybe if less taxpayer money was spent on off-duty settlements and Luke's campaign literature, there would be more money to hire more police officers...

EdHeath said...

I don't know what is special about April 9th beyond that it is far enough from the Primary not to seem like pandering, yet close enough to stay in memory. And I don't know the Council's palimentary rules, whether they can table measures or even just schedule them for a vote after the primary.

Still, I can't see any way where the Mayor doesn't hold the majority of the cards. He could introduce a 10% or 20% cost recovery plan, and Council could vote it down, after the primary. Or, after Ravenstahl inroduces it on April 9th, council could approve the $2 an hour thing (administered by the FOP) that day.

I have to believe a majority of the voters don't know the Mayor squelched the program back in November, and a majority will go along with whatever he says April 9th, as long as he says something. I mean, the O'Neill thing puts *some* pressure on Ravenstahl. So far the flip flopper label has not stuck on Ravenstahl, but maybe "Why wait" will. Still, do you seriously think *this* issue will go anywhere?

Smitty said...

When is the settlement for Catherine McNeilly going before council.And will council hold that meeting in private executive session or openingly for the public???

Anonymous said...

The MSM is really dropping the ball on so many of these issues. Since when doesn't the media care about an illegal executive session (the one that was held last wednesday morning w/o the required 24-hour notice?)? Since when doesn't the media care about violations of open-records laws when Council holds a secret meeting to discuss cost recovery (in addition to the Eggleton lawsuit)? Peduto was within his rights to discuss the lack of a cost recovery fund to satisfy the Eggleton settlement, and the media should've shone some light on the eerily concerted effort of Shields, Motznik, Deasy & Bodack to cover-up Luke's latest blunder.

Why hasn't anyone asked Act 47 to weigh in on the administrative torpedo to the cost recovery program? Seriously, what are these guys paid to do? We never hear anything from them anymore.