Motive challenged in library employee benefit cuts

By Kasey Hawrysz \nkhawrysz@indiana.edu \nCome Jan. 1, the Monroe County Public Library will cut some benefits for employees in preparation for an expected loss of revenue in 2012. That is, unless one library committee has its way. \nIn the early 1990s the library issued a bond to cover the cost of an addition to its building, said Treasurer John Walsh, a member of the library’s Board of Trustees. Libraries are funded by taxes from the county option income tax funds, and establishments with more debt receive a larger amount of revenue per year. However, by 2012 the bond issue will be entirely paid off, and as a result the MCPL will lose between $350,000 and $500,000 in revenue each year. \nIn preparation for the expected loss of revenue in 2012, the MCPL Board of Trustees decided to cut parts of the employee benefit plan Aug 16., 2006, effective Jan. 1. MCPL has cut the maximum number of sick days employees are allowed to accrue from 180 to 130, and workers can now receive compensation on only 30 unused sick days, as opposed to 60 in the past. But the most controversial issue is the cutting of a benefit that allowed employees to retire at age 60 and receive 90 percent medical coverage from the library until Medicare kicked in at age 65. \nAlthough the issue has been declared “dead” several times since the decision was made over a year ago, a committee was recently created to try and compromise, Trustee Randy Paul said. The committee is considering “grandfathering in” the program for those who have worked at the library longest. For example, one plan suggests that everyone age 55 and older be eligible for the plan upon turning 60. \n“It is a nasty thing to do to people, because we’ve had the promise to our employees who have stayed for 30-odd years,” Paul said. “We are really subjecting them to a huge risk if we don’t stop this before January.”\nDirector Cindy Gray, who is at the center of the controversy, said the idea of “grandfathering in” the benefits package does not appeal to her because it favors some employees over others. \n“Whether you’ve been here one year, five years, 20 years, you are all equal,” Gray said.\nDepending on the number of retirees, the over-60 health care program could cost anywhere from $14,395 in 2008 to $293,359 in 2016, said Stephen Moberly, president of the Board of Trustees. \nThe benefit program is one of the most generous in the state, Moberly said. MCPL does not compare itself to other libraries – nationally or within Indiana – because nowhere else offered this kind of benefit package, he said. \n“Sixty nine percent of our budget goes to salary, and that budget is higher than any other library we’d compare ourselves to,” Moberly said. “I’ve also urged the Board to accept a three percent wage increase across the board. We haven’t been skimping.”\nHowever, not everyone is positive cutting benefits is the answer. Paul sees the measure as both vindictive and economically irresponsible. Gray, he said, is using the benefits to “clean house,” encouraging those she sees as “troublemakers” to leave. \n“All these Chicken Little, ‘the-sky-is-falling’ scenarios for if we continue the benefit program are nonsense,” Paul said. “She is using the politics of fear to make people afraid they are going to lose their jobs.” \nOriginally, the benefit plan offering employees the chance to retire early with 90 percent health coverage was instituted as a cost saving measure, Paul said. Employees at that age have usually reached the top of the pay scale, he said. If an employee is paid $50,000 a year, but instead retires and the library pays $5,000 in medical care, the library gains $45,000 a year it would otherwise still pay to the employee. And since the library starts all employees at the same entry-level salary, even if it hires someone to replace the retiree, it is still saving thousands of dollars. In calculating the possible expenses of the benefit program, Gray leaves out half of the equation, Paul says. \n“(The benefit plan) was a legitimate way to cut costs, but now they say this plan will bankrupt us,” Paul said. “No one can convince me they don’t \nknow this.” \nGray disagreed. Though in principle that might be how the benefit program would work, she said with the decline in revenue and the size of the staff the future is unpredictable, and the library must prepare.\n“With the decline in revenue, the only way to make it up is to cut materials and cut staff,” she said. “And it wouldn’t be prudent to take our $1,000,000 materials budget and just cut the nearly $600,000 we’ll lose from there.” \nGray said the plan is necessary to prevent the library from having to cut staff in the future. Walsh agreed. \n“We’re preparing so we don’t have to cut services or programs, lay off staff or cut our hours of operation,” Walsh said.\nHowever, Paul said he believes cutting these benefits will “come back and slap us in the face.” \n“What we ought to be doing is to put a committee together of people experienced in money and fund raising to do strategic planning for the future,” Paul said. \nGray is cutting benefits to try and force a group of long-standing employees she considers to be “troublemakers” to quit, Paul said. In a widely circulated e-mail to the board of trustees, Gray makes this clear, he said. \n“Part of me wants to be benevolent, but on the other hand, these same folks are the very ones who didn’t bat an eye at accepting five to seven percent pay increases in recent years, which is why they’re topped out in their salaries now, and is at least part of the reason MCPL is currently in this position – because we didn’t stop giving – or taking as the case may be. To be blunt, losing some of these folks could indeed be healthy for the organizational culture,” Gray said in the e-mail. \nGray said there is a faction in the library that does cause problems, including making personal attacks on her. \n“It is well known in the library that there is a group of staffers from the early 90s who have worked against authority and against overall policy and the overall agenda of the library,” Gray said. “But up until the last six months, I didn’t think they were doing it maliciously.”\nGray says the personal attacks on her have taken a toll. \n“It is fine to have a voice, but when you get personal, it discredits the whole thing,” Gray said. \n“It is wearying. It causes you to second guess yourself when you know what you are doing is right, just maybe not the right method.”