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5.13. SR 04-12-2004MEMORANDUPI TO: FROM: DATE: Mayor and City Council Pat Klaers, City Adn~rator April 12, 2004 SUBJECT: Discussion on City Organization Structure Item 5.13. On February 26, 2004, the City Council called a special meeting for April 5 to discuss the city organizational structure. At the March 15, 2004 City Council meeting, the organizational structure xvas removed from the special meeting agenda and xvas replaced with the Sherburne County Jail site plan review. At that time, I moved the organizational structure discussion to the April 12, 2004 regular CiU, Council meeting xvith the hope that the agenda xvould remain light in order to accommodate an hour plus ~vorksession type discussion. I placed the organizational structure discussion on the April 12 meeting as this agenda was open because the annual reports had been moved to Mav 3 due to the availabiliw of the City, Council Chambers. It's in even'one's best interest for the Cit7 Council to be flesh and enthused about having the discussion on the ciD' organizational structure and if this is not the case due to the lateness of the meeting, then this agenda item should be continued. Hoxvever, this is aver?' important issue and xve should not wait too long before ~ve begin to address some changes in our organizational structure. S:NCouncilNPat~2OO4No~'ganizdisc.doc PAver MEMORANDUM TO: Mayor and City Council FROM: DATE: Pat Klaers, City Ad/n~'ni~t~r~t0r . April 12, 2004 ~~ SUBJECT: Organizational Management Item 5.1 3. Background On January 20, 2004, the City Council reviewed the City Administrator and City of Elk River xvork program as prepared bv Mr. Brimeyer. At this meeting, the City Council directed me to move fotxvard with one of the items listed under the organizational management section. This assignment \vas: "With staff assistance and Council input, propose options for preferred organizational structure, staffing levels, reporting relationships, and a timetable for ultimate implementation over a txvo - three year period." I believe the City Council wanted to accomplish txvo goals xvith this assignment. The first goal xvas to improve the services the city offers to the pubhc. By reorganizing some departments and programs, it should result in better communication between some key staff members and better coorchnation of services. The second goal xvas to reduce the number of employees that report directly to me; xvhich in turn provides for more direct management and supervision of employees and their work responsibilities. With this assignment, I sent out a February 4, 2004 memo to the Mayor and Cit7 Council and to the sixteen employees that participated in the Brhneyer project. This memo requested feedback on ideas and xvays to improve our city organizational structure. Included with this memo were organizational charts from six metropohtan communities. A follow-up memo dated February 26, 2004 xvas sent out requesting feedback from eveu, one by March 15, 2004. I received feedback from three of the five elected officials and nine of the sixteen staff. Some feedback came by xvay of nexv organizational charts being offered. Some feedback came by xvay of one of the six charts being selected as the best xvith comments attached. And finally, some feedback from a fexv department heads offered comments for only thc organizational segment that related directly to their xvork. The feedback that I received was generally consistent and a common vision for our future organizational layout was identified. Most of the comments xvere posidve in X ta.(~- Rej~or/-O~a,i~.a/iona/ X tr~.wn~re 12, 2004 Page 2 that they believed that the changes being considered xvill help in the overall management of the city as it groxvs and strives to provide more and better services for the public. It is intended that this April 12, 2004 City Council discussion xvill serve as thc starting point in establishing a revised and long term staff organizational structure. The folloxving are some of my thoughts on the city organizational structure. Parks and Recreation Director This change has already been approved by the City Council. This change calls for the ice arena manager, senior citizen coordinator, and recreation manager to report to thc parks and recreation director. Additionally, the park segment of the Street/Park department will be separated out and Parks Foreman Terry Bye, xvho supervises park maintenance employees and activities, ~vill be reporting directly to the parks and recreation director. The hiring of a parks and recreation director xvill be a positive step for the city. Ice Arena Manager Rich Czech, Senior Citizen Coordinator Sue Kostanshek, and Recreation Manager Michelc Bergh will all be able to receive direct supervision from someone who has more expertise in park and recreation activities. The director will also have more thne to dedicate to these employees than I have had over the hast fexv years. The director xvill also free up thne for the Director of Planning Michele McPherson as she xvas fulfilling a key administrative role by xvorking with the Parks and Recreation Commission. The annual cost to the city for this needed change in our organizational structure is equivalent to the wages/benefits for the nexv parks and recreation director plus overhead expenses. Benefits of this change include the reduction in the direct reports to me in the parks and recreation area from three down to one and better coordination of programs and services. Public Works Director My recommendation calls for the establishment of a public ~vorks director position and this recommendation is dependent on and connected to the recommendation for the establishment of a CiD' Engineering department. This department ~vould consist of an engineer, three or four engineering technicians, and one clerical support staff. Initially, the public ~vorks director xvould have the dual responsibilities of functioning as the city engineer and managing the engineering department as xvell as functioning as the public xvorks director that ~vould supervise the street superintendent and the xvastexvater treatment chief operator. It is conceivable that the public xvorks director could also supervise the ~vater deparuncnt if this function xvas ever to be given to the city by the Utilities Commission. Regardless, the public ~vorks director xvould have to xvork closely with the utilities general manager. Establishnaent of a City Engineering department has been discussed for many years and the city is getting to the point xvhere the establishment of this department is necessary and a high priorit7. The cost for establishing and the annual operation of this department xvould be expensive. Only part of the annual operating expenses could be offset by revenues generated through public improvement projects and wor -king xvith development projects. In addition to the operating expenses for the salaries/benefits for the employees there xvould also be expenses for equipment and vehicles. Office space has been set aside in the remodeled Ci~ Hall facility for the City Engineering department. S:~(~(~uncil~Pat~201~4~organizational regret.doc £tq[/'Report-Or£ani~atio,al Structure Apffll2, 2004 Page 3 The establishment of a public works director and City Engineering department xvould be a benefit to other city departments that coordinate activities xvith the cit3T engineer, to the orderly development of the city, and to many or our citizens. The benefits xvould include improved customer sen, ice. An additional benefit for me is that I would have one employee reporting to me instead of three; the consulting engineer (not technically a ciD, employee), the street superintendent, and the wastexvater treaunent chief operator. Also, the street supe~wisor and the xvastewater treatment chief operator xvould benefit from the hiring of a public xvorks director. They xvould be receiving direct supervision from someone xvho has more expertise than me in their xvork areas. The timing for thc establishment of a City Engineering department and public xvorks director position is dependent upon available funds and the actual cost to the city'. It is likely that monies for this position and department will not be available for a fexv years. Community Development Director The most common feedback ~vhich I reccivcd xvas that the city needed to consolidate a number of current departments within a Cormnunity Development department and underneath a community development director. This director position would supervise planning/code enforcement, building/environmental and economic development activities. Thc estabhshment of a community development director position would reduce the number of direct reports to me from three to one. The estabhshmenr of this position would provide for better communication and coordination of our development activities and this xvould result in better customer service. The community' development department would have to coordinate activities with other departments, especially the city engineer, the finance director, and thc parks and recreation director. With the community development position, the City Council xvill have a choicc of hiring a ncxv employee for this position or promoting internally xvith the community development director having a dual responsibility until additional staff can be afforded. If hired from the outside, this position would cost the city about $100,000-110,000 in xvages and benefits. If promoted from xvithin, this position ~vould cost thc ciD, the equivalent of a mid-level position. The hiring of a community development director could happen at any time if promoted internally. If the position is filled from the outside, then the position competes for funding with other requested ciD' positions. Public Safety Director It is not recommended that the city establish and hire a public safety director. The cost for this position does not justify it being established. The cost in wages and benefits would cxcccd $110,000. The direct reports to me would only be reduced by one. It is also questionable if this position would hnprove services being offered to the pubhc. The current coordination of activities and communication between these t~vo department heads is excellent (especially noxv since they are officed in the same building). A number of communities have estabhshed this position, and over time, gone axvay from it as it was not necessary and/or cost effective. Administration and Finance This "General Governmcnt" area includes four department heads: the finance director, prosecuting attorney, hquor storc manager, and the ciD; clerk. There is a ~vide range of activities and responsibilities remaining xvithin the Administration and Finance areas. Many cities have an assistant city administrator position that also functions as the S:~C(mncil~l)at~2OO4~organizational regret.doc :4i~ri/12, 2004 Pa~ge 4 human resources director; and/or this assistant cit3, T administrator supervises the city, clerk position and "miscellaneous" administrative responsibilities. In this Administration and Finance area, xve need to be flexible. This is thc area that is hkely to change last in our reorganization, but the thning depends on available funding and staff turnover and hoxv changes in this area rank as compared to our other needs. With that being said, one recommendation being considered is that the liquor store manager could report direcdy to the finance director. Within this Finance and Administration area, ~ve also need to remember that the information technology and the human resources activities are supervised by the finance director. It should be noted that I believe xve ~vill need a full time human resources coordinator/director in the very near future. I am not prepared to make any recommendations in the Administration and Finance areas at this time; but ultimately the activities in this General Government segment should be managed by no more that txvo employees that report directly to me. Options and Recommendations My recommendations may be viewed to be somexvhat conservative as I believe it xvill take time to make all of the necessary changes in an orderly fashion. All of the available monies for additional personnel cannot be dedicated strictly to thc reorganization and adding management staff as, over the next five years, xve will certainly need additional employees in Streets, Pohce, Building, Cable ~15;, Finance, etc. Also, xve are trying to make these changes at a time when our state aids (LGA) has been reduced. It should be noted that some of the recommended changes may be stressful for some employees. Some of the changes may impact existing employees in terms of their current responsibilities, and this in turn may hnpact their comparable worth point rankings xvhich may ulnmately impact their pay. Everyone needs to look at the proposed changes from an objective point of viexv but it is vcLw hard not to consider thc individuals in the positions that xvill be impacted. The city should really bc working with a "clean sheet of paper" when laying out its future organizational structure but this is hard to do. It is hkcly that some titles xvill change in this reorganization process xvhereas some current departmcnt heads may have their titles changed to reflect the fact that they are managing a division within a department. Also, the thning for some of the recommendations may be best when xve have a turnover in employees that are in key positions. There are numerous possible variations to the recommendations included xvithin this memo. One of the variations has the Engineering department being included within Community Development. Txvo years ago I suggested estabhshing a pubhc services director position that supervised Building, Planning, Economic Development, Streets, and Wastexvater. This is still an option to consider. (This position is similar to ~vhat is in the City of Blaine model. As ~ve gro~v to a fully developed community of about 35,000 xve may xvant to pursue an organizational structure that is similar to the City of Blaine, xvhereby only about 3 to 4 department heads report directly to the city administrator and then each of these department heads manage about 4 to 5 divisions.) Another option is the hiring of a public safety director, but again, I don't beheve that this xvould be cost effective for the city or beneficial in terms of improved customer services. The most significant number of variations is xvithin the Administration and Finance areas xvith the possible establishment of an assistant city administrator position that is equivalent to a department head position. Finally, I do not support S:NCouncilN1)atN2004~ organizational mgnx~t.d oc ~4;bri/12, 2004 having the Sewer department shift to the Utilities nor the establishment of a Ci~ Assessing deparunent. The parks and recreation director position is happening in 2004. This nexv position will impact the 2004 and 2005 budgets as the entire annual salary gets incorporated into the department operating budget. This will bring the direct reports to me down from 15 (this nurnber includes the consulting city engineer) to 13 in 2004. The communiU, director position needs to happen soon. This change would bring the direct reports to me doxvn from the new total of 13 to 11. For all of the same reasons that a parks and recreation director makes sense so does the community development director. The reasons include better direction by a supervisor to his/her employees, better communication bet~veen departments, and through this better coordination of activities, better se~wices xvill be offered to the public. An internal promotion could be absorbed into the budget ahnost in, mediately. Funding for the hiring of a director that is outside of our organization could not happen until 2005 and it is likely to be even later. Other budget request for additional personnel in 2005 that are known include; a cable TV employee, (parts of) two pohce officers, a Street department employee, a f~re inspector (partially for apartment inspections), and an employee for the Finance department. Accordingly, depending on Council priorities, if the community developrnent director is not hircd from within our organization, it is hkelv that this position will have to wait and 2006 seems too long to wait if we are intent on malting some organizational changes. My recommendation is that xve hire from xvithin. The next step in the process would be to estabhsh the pubhc works director and the City Engineering deparunent. Unfortunately, based on the above scenario, it does not look like funding will be available for this position and department until at least 2006 and it is very likely that it xvill not be available until later. While our need for additional engineering services is a high priority, I think that the expenses associated xvith the department and the director xvill be somexvhat imposing. In this regard, I think that xve need to ~vork xvith TerU, Maurer and the Howard R. Green Company in order to tU, to get more of Terry's hours available to us here at City Hall xvithout it significantly impacting our budget. If xve can xvork out an arrangement xvith Howard R. Green for more of Terry's thne, without it breaking our budget, then this could serve as a good transition step xvhilc xve plan out the necessary manpoxver, vehicle and equipment expenses; hoxv ~ve can recover some of these expenses through our improvement projects; and then finahze the thning for actually moving fo~xvard xvith the public works director and the engineering department. In the meanthne, assuming ~ve do the parks and recreation director and the community development director, xve have reduced the direct reports to me from 15 to 11. When the Public Works deparunent is estabhshed (in 2006-077) this ~vill further reduce the direct reports to me from 11 to 9 and then xve are getting to a more reasonable number. At this time, I want to %vait until the dust settles" a little bit with the parks and recreation director and communiU' development director before xve proceed ~vith the public works director/City Engineering department and with any changes in the Administration/Finance area. Over the past fe~v years rnost of these recommendations for changes have been discussed to sorne degree, so nothing in this memo should be too much of a surprise. I need feedback from the City Council on how to proceed with some of these issues outlined in this memo. S:~(~ouncil~ I~at ~ 2004~org;mizational regret, doc Cffv Admi stramr City of Elk River Dozember, 2003 P. ~2 N N ORGM 7ZATIO_ 'Mi MANAGENLENT · Develop ~ plan which provides Lbr more feedback and evaiuation of sta~pe~brmanc¢. Initiate 1/01/2004, Evaluate every 30-90 days · Assist semor staff'ir, developing individual goats and department goals ;c ensure personal and prcfessionat growth and department effectiveness. 1st Quarter 2004 With staff assistance and Council input, propose options for preferred organizatiozai smacm.re, staffing leveIs, reporting relationships and a timetable ~br ultima:e implementation over 2-3 ye~ period. Initial report - 1" Quarter 2004; Final plan 2"a Quarter 2004 C OL~'CLL/STAFF KELAYIONS · With Council input, develop a system for more "informal" Council discussions to evaluate proposals and policies prior to formal Council approval. 4~ Quarter 2003 · Wbrk with the City Council on "acceptable rules of behavior" for Cotmcil, staff and Administrator interaction and communications - formal and informal. 4~ Quarter 2003; 1't Quarter 2004 GO k~ER.N,azNCE · Arrange tbr goal setting/strategic planning session for Council and sta22:.1~' and ?a Quarters 2004 · Assess and provide options to the Council for the pr:fen-ed governance model to guide policy development, options, and guidehnes for decision, making..2"~ Quarter 2004 CITY OF ELK RIVER ORGANIZATIONAL CHART '~ c:,. :, COUNCIL ~t,?, (b BOARDS & ' ,., COMMISSIONS _. ,~.~.Z Z ~ ' AD MI N I STRATO R CI-FY CLERK ECONOMIC DEVELOPMENT PLA, NNING BUILDING & ZONING STREETS & PARKS POLICE FIRE RECREATION ICE ARENA LIQUOR -- STORE PUBLIC UTIL!T1ES CONSULTING CITY ATTORNEY MAYOR & CITY COUNCIL CITY ADMINISTRATOR BOARDS AND COMMISSIONS EDA HPC HRA ICE ARENA LIBRARY BOARD PARK & RECREATION PLANNING COMMISSION RECREATION DEVELOPMENT BUILDING/ ENVIRONMENTAL RECREATION PARK MAINTENANCE ICE ARENA SENIOR CENTER PLANNING/ CODEENFORCE ECONOMICAL DEVELOPMENT I ~%BRLKICS [ [ PDOELIPCTE II ENGINEERING & MAPPING WWTP STREETS/ BLDG. MAINT./ EQUIP. MA1NT. PROSECUTING FIRE DEPT THIS ADMINISTRATION/FINANCE (OR "GENERAL GOVERNMENT") SECTION NEEDS FURTHER STUDY