City “falling apart”: Fiscal panacea proves poisonous

Rosenthal, Brian

Fifty-nine city staffers, including most of the department heads and the city’s chief executive.

That was the toll of Evanston’s Early Retirement Initiative, put into place by the City Council last year. The window to take initiative closed at the end of last month.

Now, the dust of the mass exodus has settled, and the 800 city officials who remain are scrambling to adjust.

“Change is naturally uncomfortable,” said Ald. Edmund Moran (6th). “When you have a big turnover, there are always some adjustments and people are dealing with that.”

The initiative allowed 20-year city workers over the age of 50 to retire and start receiving full benefits before the normal minimum age, 60. Then-city manager Julia Carroll presented the plan to aldermen as both a lucrative deal for long-time staffers and a way to save the city some $5 million. Some of the retiring staffers would go unreplaced, with other city employees taking on additional responsibilities. And replacements would likely have lower salaries due to their lack of city service time.

The council passed the measure last January. Two weeks prior, a PowerPoint presentation to aldermen said 104 city employees would be eligible for the initiative, but just 51 staffers had expressed interest in taking the offer. When 59 staffers ended up taking the incentive, alderman and staff said they were shocked.

“Of course we didn’t know (so many would take it),” said Ald. Steve Bernstein (4th), who said the initiative “failed the city.”

Among those leaving under the initiative were the city manager, her assistant, the city clerk and six of the city’s nine department heads. Two additional department heads departed in the past year-one retired, one resigned-meaning 11 of the city’s 12 most senior bureaucrats have departed in since last summer.

The loss of the experience has hurt the city, residents said. “It’s a disaster,” said 64-year-old Elliott Dudnik, a community activist who received his Ph.D. from Northwestern in 1983. “It’s a tremendous loss of institutional memory. Who knows how long before the city recovers.”

IRONIC DEPARTURE

The most unexpected departure of all was Carroll, the city manager, staffers said.

Julia Carroll, 55, arrived in Evanston in 2005 with instructions to help a city in financial trouble. (Evanston faced a $3 million budget shortfall at the time.)

In 2007, Evanston’s human resources director approached Carroll with several suggestions to shave personnel costs, according to staffers. One of the ideas was the retirement initiative, which Carroll decided to pitch to the council.

The move was seen by some as part of a larger scheme by the city manager to replace existing senior staff with her own administration. Meanwhile, current senior staff were becoming increasingly unhappy with Carroll’s management style, according to May interviews with three retiring department heads.

In a phone interview in May, Carroll said she wasn’t aware of problems with fellow staff and “certainly” wasn’t trying to force them out. Amid the personnel difficulties, Carroll herself became eligible to take the initiative when she got to the 20-year service plateau in April, according to city documents.

And then she became ill.

On April 27, Carroll quietly filed a notice of intent to retire under the initiative with the Illinois Municipal Retirement Fund. The document, which the Daily obtained in a Freedom of Information Act request, came just three days before the initiative deadline (to allow 60 days warning before the June 30 final deadline).

The next day, Carroll cited unspecified health reasons in announcing her resignation from the $180,000+ job. “I finally decided that I needed to take some time to focus on my health,” she said at the time. In a May 15 phone interview, Carroll told a Daily reporter she was not taking the initiative. But two weeks later, on May 29, she filed her final application for early retirement, according to IMRF documents.

The little known decision, which cost the city an estimated $300,000 in retirement fees to Carroll, came as a surprise to some staffers.

“I’ve heard people in the city council whine about it,” Moran said. “But if they’d paid enough attention to it, they would’ve unde stood that she was eligible.”

Messages left for Carroll on Sunday and Tuesday were not immediately returned.

PICKING UP THE PIECES

With the initiative in the past, the remaining city officials are working overtime to keep the city productive. And they’re trying to move on.

On July 14, an internal memo outlining a transition plan was circulated by Carroll’s replacement, Interim City Manager Rolanda Russell.

Under the plan, new Human Resources Director Joellen Daley and Parks/Recreation Director Doug Gaynor are essentially splitting the traditional functions of the Assistant City Manager, the two officials said.

The vacancies continue to be filled.

Last week, the new finance director was announced. Martin Lyons, the current area vice president for Gallagher Benefit Services, will start next month.

“I met with the staff and they seemed like a very good group,” Lyons said. “I’m sure we’ll be able to handle our city’s finances in a professional manner.”

City hall is finally experiencing a “little bit of stability,” said Gaynor, the only department head who was not eligible to take the initiative. But some residents said they’ve seen increased mistakes from city hall.

“The official position you’re gonna hear from the city is everything’s fine,” said former aldermanic candidate Junad Rizki. “But I don’t think so. I think everything’s been falling apart a little bit.”

Rizki alleged the city is taking longer to get things done and is making more mistakes. As an example of the mistakes, he pointed to a city-leased apartment, whose lease had expired in 2006 without the staff noticing. Rizki added that the staffers themselves used the exodus as an excuse for the oversight.

The ultimate cost or benefit of the early retirement initiative will not be known for awhile. The large number of people taking the plan probably negated some of the financial gain, Bernstein said.

A cost estimate is expected in the next month, said Daley, who declined to speculate on what the estimate might say. Russell acknowledged that the benefit will fall at least a bit short of the $5 million projection.

Regardless, city staffers are looking to the future, said Russell, who said she has been working 14 hour days since taking over in May.

“We’ve really tried to make sure that the citizens continue to get good service and I think the staff here has done an outstanding job,” she said. “I think we have an opportunity to get people from other organizations. That lets you look at the same problem through different eyes, and that’s a good thing.”

[email protected]