can reuse it? >> it can be filtered out and used for other products. >> [speaking spanish] >> it is going to be a good thing for us to take used motor oil from customers. we have a 75-gallon tank that we used and we have someone take it from here to recycle. >> so far, we have 35 people. we have collected 78 gallons, if not more. these are other locations that you can go. it is absolutely free. you just need to have the location open. you are set to go.

>> good morning, everyone. welcome to the april 14th meeting of the audit and oversight committee. i am david campos, joined with mark farrel and david chu. the clerk is andrea osberry. and we want to thank the sfgtv staff for covering this.

do we have any announcements? >> turn off all cell phones. if you want to speak, fill out a public speaker card. copies of all documents will be included in the file and should be submitted to the clerk. >> can you call item no. 1? >> this is the hearing on the controls report on the current and projected budget costs, with the use of overtime hours. >> thank you very much. this is an item i introduced with the understanding that for every member of the board of supervisors and the mayor, the issue is a very important one, something we have been watching for some time. and i thought it would be important to have this discussion here, at the

oversight committee. let me turn this over to the comptroller's office, and i thank you for being here. >> this is a committee, as you know, the comptroller's office monitors this on a biweekly basis. we thank you for calling to this hearing -- i have a very short powerpoint to submit to the hearing this morning, and i can give a copy to the public. a number of limitations -- about three years ago, by the board of supervisors. that ordinance requires the comptroller to submit monthly overtime reports to the mayor and the board, identifying these departments and their overtime. we have the existing ordinance

requiring overtime twice per year, estimating the total over time. finally, the administrative code section also established the individual employees for the city and the county, stating that they could not earn more than 30% of the overtime as compared to the straight time. in this fiscal year, over time spending is estimated to be about $40 million, more than has been budgeted for overtime. this is $12 million more than the overtime spent last year. this is based on the evidence of about seven months, and generally, the department that is getting the overtime budget has the available dollars in the regular account to pay for the

work. this is based on a straight line projection, but seasonal fluctuations do occur, and some are aware that over time is used more heavily because of vacations, such as the municipal transportation agency. they are working overtime because of the construction work and the other kinds of things that require additional transit. these suggestions should be used only as a starting place, to make the department heads aware of the overtime compared to the budget, for the mayor and the board of supervisors to be aware of this as well. and so, on page #4 you can see a line graph that shows the overtime usage, since 2005.

this is the percentage to the gross salary. you can see that a number of years ago, this was under 5.8% of the overtime, and this was 6.6% and it came back down to 5.45 and you see the projections for the current year are 5.6% of the overtime. since we have been reporting a couple of years ago on a monthly basis, the five departments using the most overtime have been constant. the municipal transportation agency and the fire department, the department of public health and the sheriff in that order. there was one month in the last couple of years, when they exceeded the overtime hours, but this was an anomaly.

looking at page 6 of the report, what we have done is look at those five departments and the actual overtime since the fiscal year 2005 and 2006. the overtime has gone up in the last six years. almost 40 million in 2007, going up to 46.5, and the actual expenditures were $45.6 million, and based on a straight line this year, this would be $51 million. there were some changes to the scheduling, with a number of construction projects requiring overtime, and also, the municipal transportation agency. this is mostly in the drivers and the parking control officers.

these garnered the most overtime, and the municipal transportation agency is aware of this and they do have the salary dollars in the budget, although not in the overtime account. the level of appropriation is for total salary, and we make sure that the departments are not overspending. the police department is the next-highest overtime user, but if you look at their actual use of overtime over the last year, this has come down significantly. this has been reduced from a high of $26 million in 2007 and 2008, to the all-time low that is expected in the current year of $10.5 million. this is over time to the general fund. the police department also had overtime when there are events

in the city, paying for the police coverage. this is paid, the dollar for dollar, by those businesses. we have the general fund overtime paid by the taxpayers. the public health department is the next apartment, and the last couple of years, the overtime use of the health department has hovered around 9-$10 million. the overtime as a percentage of total time is much less than the other departments and this is because the health department has these programs for the nursing staff. and as they have vacancies or need to replace the vacant shift, the use this rather than over time. the use overtime only if they are not able to place the shift

with the civil service nurse, as well as the private nurses. the rest of the overtime is it in areas where this is difficult to recruit, with these highly- technical positions and they are unable to recruit. in the area of the fire department, this has increased fairly significantly as the line chart shows, however, the fire department has shown that their use of overtime as less costly than the hiring of additional firefighters. and when the brownouts' happened a couple of years ago, there was a backfill of that service, and the fire department opted to use overtime because this was less costly. and this did happen, if you look at the chart on page 6, between

2006 and 2007, 2008 and 2009. this was because the fire department staffing all of the apparatus. this was down to $21 million in the past fiscal year, on a straight-line projection expected to be about $27 million. and although the sheriff is exceeding their budget in the current year, based on a straight line projection, the overline -- the line will be the lowest ever of all the years we have been tracking this with the board of supervisors. the next chart shows each of these in a line graph, and as you see, the bottom three, a sheriff and police and health -- the fire department had increased and this was based on

overtime hours, the hours used, and you can see that they are using this at a higher rate than they have in prior years. the annual report shows that the public health departments does not have a sufficient amount of salary dollars,, and these will be pending shortly before the finance committee to correct the shortfall in these departments. those shortfalls have been known to the mayor and the board of supervisors, and we have reported these in the last few projections, the second part of the restrictions on overtime speak to the individual over * for the individual employees.

over time is limited to 30% of the regular hours for each employee, and for those employees working full-time and the legislation does exclude the emergency and critical service employees, and we typically see this to be the police officers and firefighters. unless those employees are working in the non-essential categories. under this section of the code, this may only be assigned one work cannot be completed during the regular work hours, and that the department request waivers for the selected classification, and this must go to the department of the human- resources director, and the office the man's monthly

reports so that the departments can monitor the use of overtime by the employees. this was not so much to reduce the overall amount of overtime, but to spread this among the staff so that we do not get increased accidents and other kinds of workers compensation injuries, but what happens in our during the pay. in the bi-annual report, this is on page 11, 74 employees exceeded the cap, based on a pay period ending on january 7. three of them have exemptions -- and three of them are within the deputy sheriff's institution, and the request has been submitted to the department of human resources. the last was a clerical employee

and that was an oversight on the part of the department. this year, the director of human-resources did provide exemptions for the firefighters who are having a difficult time staffing because of the lack of recruitment that has been done in the current year. to summarize on page 12, the continue to monitor the overtime, and they are limiting the overtime use by the employees, and we will continue to report on a monthly basis and the bi-annual basis, and the department's staff is here to answer your questions. >> i know that we have the department heads and the department's staff here, to present, as well as the director of human resources. but one thing jumping out for me is in terms of the budget process, the mayor has convened

a working group with the community-based organizations to look at possible areas where the savings can be had. this is a very positive thing and this is a good thing to do. i do believe that since we are talking about over time -- or over-spending and over time above $40 million from what was budgeted for the fiscal year, i actually think this group should be treated for this issue of overtime. if you look at the overtime for the last few years, the amount of money given back is that the most around $40 million. this is a figure that we are talking about, this is a figure that we are above budget. so, is there a working group, if you will, of the city leaders

and city employees, looking at the issue of overtime for the whole city, figuring out how to make sure that we stay within the budget, and i just had a budget meeting in my committee, yesterday. we were asking a lot of groups to share the burden, in terms of closing the deficit. and yet, we are overspending by $40 million. >> some departments argue that the overtime budget does not represent the amount of overtime that they actually need over the course of the year. the overtime may be artificially budgeted out at a low amount to encourage the departments to keep the overtime down. if you look at the sheriff's department and the police department, this has gone down in the last few years, and there

is an intended effort to try to reduce overtime. and again, the fire department's overtime use has been shown to be less costly than hiring additional staff members. the mass transit authority is difficult to get around because the board of supervisors has limited ability to change the overtime budget or any part of this budget. they have to live within the salary line, which they are currently doing. the answer to this question -- this is not done as a group but as an individual basis with the mayor's office, working with the department heads during this. >> what i would say is that i do think that this is not enough to do this on the individual department basis. we need to do this as a city, collectively thinking about what this means for the budget. i understand how budgeting

works, but we just went through this exercise, with this report about pride and the organization. one issue is that they do, quite well, that they would have a deficit at the end of the fiscal year. if the departments are budgeting an amount that actually is not the amount that this should be, with overtime, the budget will need to change. you have to stay with the budget that you have passed. if the budget is expected to be higher, then -- i do believe we can do this going forward. president chu: i agree with what you have said, although i may,

at this differently. the police and sheriffs, public health, these are all moving in the right direction. with the big picture, after three years of overtime coming down, my first question is what you expect in 2011-2012. what is the current thinking of next year. >> the mayor's office -- the department's overtime numbers will probably go up. we have all the accounts in the current year, before this board and the finance -- the health

department's overtime has been constant, but the supervisor -- they do not reflect the actual spending. there is a realignment of dollars so that we have more realistic and accurate projections as to what the over time should be, and the overtime in the highest five departments are generally spent in the 24-7 areas, and perhaps they could be avoided in some departments by hiding -- hiring additional staff. but over time has been shown to be more cost-effective. i do expect, from your direct question, that there will continue to be pressure from the administration to the departments, to take a look at the overtime reductions before the leading positions were

cutting salaries. >> is mass transit authority here? i know that the fire department is here. i am still puzzled about how we cannot figure out, with a little bit more predictability, what the needs are going to be. and i will bring these questions when the department comes up. i want to recognize them and thank the department's moving in the right direction and i do feel that we have to get a handle on this across the city. this is not acceptable to us that we cannot seem to get our hands around how to keep these costs contained. we have to figure this out. i do have a quick question about exemptions. the vast majority of the employees are giving exemptions from human-resources or the city. can you talk about the places

where these are granted? >> as part of the presentation, we will hear this from the director of human resources. >> and other any other questions? thank you. we will now hear from the director of human resources. thank you for being here. >> thank you. i do not have a specific presentation by i am prepared to talk about the exemptions that we have granted and what the process has been for doing this. at the risk of sounding self- serving, we have had high standards and i think that, although i would agree that the primary effect of having the individual over time limit as to spread around over time, there is belief that people get used to getting overtime, departments are used to giving us, and so to

the extent that people are depending on this, the limit has had an effect. and since the limit was put in place, there has been a general trend of reducing overtime throughout the city, and this is at least part of the reason. we have several basic criteria for approving the exemption. if the employee is held over for mandatory overtime -- an example would be a radiology technician, with a specialty in and they have to hold a person over. this would be the other example. we grant exemptions to the homicide investigators in the middle of a complex case, and they have to be the person who is handling this. you cannot relate -- readily hand over the work with the

jeopardizing the work itself. we also have an exemption we can grant, if an employee would be forced to work and voluntary overtime assignment and so the idea is not to force people to work overtime when others are available, to do this for the same price. and if the employee is assigned to mandatory training, again, we see this in the 24-7 operations. there has to be training in a cost-effective manner, other than five sections of the same training. the overtime would apply for a combined total of regular and straight our supporting to the week. if i have a 32-hour schedule, and i work the additional eight hours by i am working at the straight time rate, this is

considered overtime. but this is not precisely overtime. we have given exceptions to the following groups. we're just going through some questions about the circumstances. we believe that there will be approval there. and the sheriff's department was above the limit, and they have mandatory staffing. and the fire department you have heard about on an hour by hour basis. this is associated with the medical benefits, so on the hourly basis this is often cheaper to use fire fighters on the overtime basis. and the question comes, do they have to work the overtime. and since there is a staffing minimum, they do. in order to comply with the labor agreement.

that is how this generates. >> this is happening at what level? >> i can see that the chief is here, but we do have requirements. if you read the labor agreement, they will say a certain number of -- number of people on the truck will provide the staffing level. we have absences, and we have to get people in on overtime. 300 hours per day. 300, minimum staffing. >> so this is not for each truck with staffing. >> this is the city-wide minimum staffing level. >> we were joined by the fire chief. we just want to clarify this, so thank you for being here.

>> we are here with 300. this breaks down into the minimum staffing, so the engine company, the smaller of the two apparatuses, this is staffed with one officer and three firefighters. this is staffed with one officer. and there are specific minimal requirements, for the overall total of 300 for each shift. >> i understand why you would need a certain number of people. the question is about how many engines that you need. we can figure out how many that we need, but is there a minimum number that we need across the city, set by these greater standards. >> the way that we are currently staffed, this works well on any

given day in the city, and in the event of a large-scale disaster, we have 19 companies working and 42 engine companies. >> before we continue, once we hear from the director, we will hear from each one of the five departments. we should let the director continue. >> i will be brief. my part is the most boring. we do have requirements in the labor agreement, and we do provide an exemption and for the police i mentioned the homicide inspector. we have a group of our technicians -- and i cannot speak to the mass transit speak to the mass transit authority exemption, because the