Department responsible for S. Tahoe’s finances stays intact
By Kathryn Reed
While employees keep dropping off the payroll in South Lake Tahoe, and even more layoff notices are expected next month, the finance department has for the most part remained fully staffed.
In fact, while other departments are asked to do more with fewer employees, this department hires temporary workers. This is at a time when there are fewer paychecks and other money related items needing processing, and the fiscal projections from this department are regularly off the mark or not fully accounted for.
Admittedly, no one has a crystal ball to know what the future holds, but South Lake Tahoe’s finance experts in the last handful of years projected increases in revenue from hotel and property taxes – at a time when everyone said the country was in a recession. Those projections were wrong. Those are two of the three main revenue sources for the city.
And the director of the department, Christine Vuletich,was told by City Manager Tony O’Rourke to put the potential $1.8 million loss from redevelopment into the budget – something she had kept out until recently. It makes the city’s deficit headed into 2011-12, which starts Oct. 1, $5.2 million instead of $3.4 million.
Christine Vuletich
Each year the city’s general fund is supplemented with redevelopment money, which is really the TOT collected in those areas. The hotel tax is higher in the redevelopment areas than the rest of the city. Tax increment is not enough to pay all of the millions of dollars in redevelopment debt the city has incurred, and therefore TOT is used for debt, too.
Here are the dollar amounts that have been transferred from the Redevelopment Agency (which is governed by the council members) to the general fund:
• Fiscal year 07 — $338,000
• Fiscal year 08 — $457,000
• Fiscal year 09 — $834,000
• Fiscal year 10 — $834,000
• Fiscal year 11– $1.3 million.
Another $500,000 each of those years has gone from RDA to the general fund to pay back the $7.2 million that was “borrowed” to pay for the Heavenly Village and parking garage projects.
Until the state makes a ruling in January about the future of redevelopment agency’s the city is not voting on what to do with its agency.
Other TOT issues
This also is the department that is accused of letting transient occupancy tax dollars go uncollected.
Councilman Tom Davis at the Aug. 23 meeting asked Vuletich what is going on with the annually unpaid $500,000 in TOT from private vacation rental owners. Instead of answering the question, Vuletich at first got defensive and argued the amount, not the fact the city is not being paid what it is owed.
The half-million dollar figure is what property management companies have told city officials is not being paid.
Even Lake Tahoe News last September was able to uncover nearly $1,000 in TOT not being paid by B Gorman, executive director of Lake Tahoe South Shore Chamber of Commerce.
Vuletich told the council that last week she met with vacation rental owners and the police chief.
“We have a joint effort under way to address that issue and that will be pretty effective,” she told the council. Specifics were not divulged.
After the meeting Lake Tahoe News asked her if she thought people were deliberately not paying the tax or if they did not know they had to. She wouldn’t venture a guess.
Finance department staffing
Vuletich’s salary was increased in March when airport and parking came under her leadership. This was at the same time staff was laid off.
She is the lone director remaining from the Dave Jinkens eight-year reign as city manager. O’Rourke defends Vuletich – saying she is competent and does a good job.
While O’Rourke when he was hired a year ago said the first budget produced with him at the helm would be easy to read and ready early, insiders say it won’t happen. Clearly, it is not early. The budget will be before the council for a vote 18 days before it takes effect. It will be released at least a few days before the Sept. 13 meeting, so readability can be judged then.
While Vuletich has more in her pocket, her employees keep being spared.
In the 2006-07, 2007-08, 2008-09 budgets the finance department had 14.5 full-time equivalent positions. The amended 2009-10 budget brought this number to 13.73. The current budget is back up to 14 FTE.
When it comes to defending her hires, Vuletich emailed Lake Tahoe News saying how other departments also use temps – like the police department for the boat patrol (though she failed to mention their salaries don’t come from the general fund), stormwater for an environmental analyst (often paid for by grants), and parks and rec summer employees (whose wages are less than the fees they collect).
The finance department uses a temporary accounting technician to process business licenses. Their fee is expected to be $7,000, according to Vuletich.
“The total temporary labor expense in the Revenue Division is expected to be approximately $30,930 at fiscal year-end and is a combination of the former temporary full-time Technician ($23,930) and the current seasonal temporary Technician costs ($7,000),” Vuletich wrote LTN. “Accounting Division: Temporary Budget Analyst hired work on budget preparation and analysis during the budget preparation period. The cost has been $5,725.50 so far through July 31st and have $23,000 budgeted for the 10-11 fiscal year, but expect to be paying for approximately 5 more weeks for a total of $10,725. All temporary labor expenses in the Finance Department have been eliminated for next fiscal year 2011-12.”
Is it just me or does anyone else wonder why the city manager continues to cut employees and ask for decreases in salary while he remains to get paid his costly salary. Why not he take a cut for the community? Oddly enough, neither he nor his family resides in the city (family remains in Colorado). I see a “burn and turn” on the horizon. The city manager will finish off the city and return to Colorado wealthy.
Keep the beancounters, give them raises and trash the people who serve the taxpayer. Great plan.
Ah yes, the “Finance Department”, aka the “Sacred Cow Department”. This is a good introductory article about the finance department’s staffing/expenses but these somewhat low temporary employee fees aren’t what cost the City big time on an ongoing basis. Temps don’t receive benefits so there’s no medical or retirement costs associated with those individuals. The real costs to the City are the top-heavy mid-managers making in the area of $100,000 apiece annually along with all their medical & retirement benefits. You’d think they’d be responsible for the leg-work in connection to the budget preparation and that the help of a temp shouldn’t even be necessary. I wonder why that is.
The city manager is great at cutting employees. But I haven’t seen anything to indicate he can run a city.
The goal of this City Mgr. is to replace all City workers with Temporary workers and contract out the work to private contractors. all but 3 from street maint are going to be layed off and wuor streets will be plowed by people that don’t the area or how to run the City equipment.
TONY O’OROURKE IS GOING TO BRING THIS CITY TO IT’S KNEES AND THEN HE WILL LEAVE,
And the Council is letting him have a free run.
They should fire the S.O.B.
Hey X LOCAL,you’re exactly right on all counts. I know of a few former city workers that were laid off after many years of work and then were offered their jobs back for reduced pay and be considered temporary employees with lower pay and no benefits.
I worked in the private sector for many years and a similar thing happened to me. Retirement aint what it used to be. Some american dream, eh? I guess for Tony O’Rourke it’s alive and well.
You People out there in the City that think he is doing a great job will soon see that he has screwed all of you. You will see that in about 4 months when it begins to SNOW.
He also plans to close down Fire station 2 in Al Tahoe and let another 15 firemen go, even after they agreed to his demands under duress and threat of lay offs.
Tony O’Rourke is going to ruin this City.
The City that he called a “DIRTY,S—– LITTLE CITY ” WHEN HE FIRST ARRIVED AND HIS FAMILY LEFT BECAUSE “SHE WOULDN’T WOULDN’T LIVE IN THIS DIRTY LITTLE CITY”
But he is alright with his $200,000 dollars a year plus benefits and full Medical for he and his Family
It appears that his plan is to get rid of the majority of employees that make over $20 per hour, regardless of their seniority, ruin the City financially so they’ll be forced to give up the incorporation (wasn’t that denied at a recent council meeting?)
It appears that his plan is to get rid of the majority of employees that make over $20 per hour, regardless of their seniority, ruin the City financially so they’ll be forced to give up the incorporation (wasn’t that denied at a recent council meeting?), then have Vail come in and buy up everything. Has anyone googled Mr. OTerrible in the local newspaper from Colorado? I hear there are some verrrrrryyyyyy interesting things. I’m just sayin………
What makes yall think Hal Cole has no input!! especially with his old hand Tom Davis at his side.
Ms. Vuletich is from the Jinkens years when you couldn’t get a straight answer on anything, especially financial matters?! She was sitting there when Mr. Jinkens would tout what great financial shape we’re in, and would never speak up and counter that?!
Plus, it’s frustrating to hear that Ms. Vuketich got a raise for taking on added responsibilities. Maybe makes sense in good times? But how about making a sacrifice and doing some extra work for the good of the town? Many in the private sector, including myself, have been taking on extra work. Not for extra money, but to keep our jobs! Too bad that’s not the mgt. style of our City!
And there’s this conspiracy theory out there, that I truly don’t know if it’s true or not! But it’s sure gaining steam. That Mr. O’Rourke will intentionally issue some bonds that can’t be repaid so as to make the City insolvent? Again, don’t know if it’s true? But it’s being implied here on LTN posts and I’ve heard it ‘out in the world’! If true, you’d definitely want a Finance Dir. in your corner to help you fudge some numbers!
Tried to make it to the Council Meeting last week but that marijuana issue took too long. I believe the City could raise the annual vacation home rental permit fee from $144 to $250 and then have enough dollars left over to pay a temp to visit the management companies to uncover even more money from the owners who are not paying their fair share of TOT. Looks like a win-win to me. Anyone?
X Local wrote-The City that he called a “DIRTY,S—– LITTLE CITY I don’t see a problem with that, it is a dirty city and I have been up here 35 years. The truth hurts and we need a change from the way we do things and Mr. O’Rourke is doing it but he is just a scapegoat because he can do nothing without approval of the council. Funny thing about all the rumors about his family gone as I saw him and his family at a concert at Harveys. As far as I know his family is here and I know because I asked rather than put out false facts on this site as I have been chastised for doing that before.
Mr. Stiles, take the time to count all the VRBO rentals that do not pay any tax as they are done by the owner on a web site. I did and there are over 550 listings in the city alone on VRBO.
Some VRBO rentals DO obey the laws. My neighbors rent through VRBO, and they have the laws posted, pay taxes, won’t rent to anyone under 25, AND they put in a bear box first thing. If only all second home owners were this good!
Good point Ski Bum! Just because The Council let Jinkens get away with so much, shouldn’t excuse this Council if actions are being taken the Community doesn’t like! And thus I should rephrase, the rumor is the CM ‘will talk the Council’ into issuing bonds that will be unable to be repaid.
Couple of comments for the discussion:
1. Non collection of TOT by VRBO is a concern is quite a few destinations and many municipalities are trying to figure out how to collect those funds.
2. With regard to the budget and layoffs it is what it is. The past city manager and city councils kicked the can down the road, bad decision after bad decision and the reckoning is here. It appears the city manager with the support of the city council is doing what many city managers across the country are doing right sizing the organization for the revenues that are available. The private sector went through this process in 2008.
In addition to job cuts there may be consolidations, salary and benefit reductions and outsourcing. The hard fact is every organization at some point has it’s own budget reality.
3. It does seem interesting the finance department has not been cut, it would be interesting to compare the head count here vs. other communities.
4. As far as vail buying everything, not sure.
1. Park City and Steamboat Springs have the same problem with most of their rentals being VRBO but one difference is their councils have the backbone to go after them and they all pay their TOT.
2. Very true statement. Although if the Council would stop allowing the two largest taxable revenue business’s to not pay their tax through sweethaeart deals and political correctness layoffs would be a moot point.
3. If you can’t collect any revenue you can’t pay anyone. Staff should be increased to go after the VRBO, Vail and the Collectives.
4. Check with any business that has anything to do with winter recreation up here and you will find that Vail is attemping to purchase that segment of business that is profitable or will increase their visibility in town. That might not be a bad thing as they are successfull.
Skibum…wouldn’t you think the city would already have someone going through the VRBO site to see if the VHRs were all licensed? There are over 1200 VHRs licensed in the city, I understand. I could see about getting that list of names to compare it at my leasure to the VRBO site but would the city do anything about it if I did locate those tax bums?
OMG the MACHINE keeps chuggen along.
Robert, no they don’t have anyone activley doing so as far as I know as I have asked various council members and they probably would not tax them. Every city employee that I have contacted has said they are overworked since the furloughs and are blaming Mr. O’Rourke for all their woes.
Ski Bum
With regard toVRBO you are correct it takes a commitment to do the collections. Hey I know if the city staff doesn’t want to do it let’s outsource it and give the collection firm a percentage. If the numbers are as you suggest 550 units hell I’ll get on the phone and do collections. Seriously a commitment to doing the audits is the only way it happens.
Sounds like a business opportunity to me, Carl.
VRBO, has an employee who was laid off in finance who’s main job was handling the VHR’s I can tell you for a fact that we check the VRBO, Homeaway, airbnb, etc. Since both the county and city VHR’s are on these sites it is hard to tell where they are located. I have sent more than a 1000 emails confirming addresses and permit numbers. I also had a number of locals helping me with sites that they find and management companies letting me know when they locate one. Since I have lost my job I trained the new department on how to do the research and I know that they are continuing it. So I believe 100% that the number posted is not correct. Looking for missing revenues was a big part of my job besides collecting what we know about. Now with the department being dismissed they will not be people being able to do the research so it is time for voluteers, so be sure to contact the voluteer department at your local city offices and help with the laying off of team players. Due to what happen to me I left this city because it is way toooo expense to live here and the most ungrateful residents after being here for 24 years it went from a family caring community to a hateful, jeously community and this type of article is the proof. No real research being done just the writers own jeously put in words.
PS. C.Vuletich was the last person to get a raise look into every other management and check out their rasies. (again no research)
VRBO, has an employee who was laid off in finance who’s main job was handling the VHR’s I can tell you for a fact that we check the VRBO, Homeaway, airbnb, etc. Since both the county and city VHR’s are on these sites it is hard to tell where they are located. I have sent more than a 1000 emails confirming addresses and permit numbers. I also had a number of locals helping me with sites that they find and management companies letting me know when they locate one. Since I have lost my job I trained the new department on how to do the research and I know that they are continuing it. So I believe 100% that the number posted is not correct. Looking for missing revenues was a big part of my job besides collecting what we know about. Now with the department being dismissed they will not be people being able to do the research so it is time for volunteers, so be sure to contact the volunteer department at your local city offices and help with the laying off of team players. Due to what happen to me I left this city because it is way toooo expense to live here and the most ungrateful residents after being here for 24 years it went from a family caring community to a hateful, jealously community and this type of article is the proof. No real research being done just the writers own jealously put in words.
PS. C.Vuletich was the last person to get a raise look into every other management and check out their raises. (again no research)
Facts that should be openly considered: 1): Finance Department manages approximately 3.5 million dollars per month.
2): This includes paying the city taxes collected by the Federal Government and California State Government.
3): Finance Department comes in well below costs of contracting to an outside accounting agency, this still includes Payroll. (Finance would still be required dc the bulk of the work giving the numbers to an outside agency.
4): Finance Department has been understaffed for awhile including prior to Tony O’Rourke’s arrival as City Manager. Now since Tony O’Rourke’s taking the reignsa-the Finance Department is currently operating severely understaffed.
5): Finance Departments position, (single position for the City), for collecting TOT has been severely diminished covering the other duties to maintain and sustain the fiscal accountability for 3.5 million dollars per month.
6): The Finance Director has taken other responsibilities overseeing other Departments outside of Finance Department.
7): Finance Department has approximately six full time employees.\
8): With more cuts coming in less than 2 ;months Finance Department will lose 2 more employees.
9): I challenge anybody to speak with any other department and see if they can do it at cost with the same labor.
10): Finance Department took pay cuts long before Mr O’Rourke came. Finance Department has been carrying the load for awhile. All members in the small Finance Department took severe compensation pay cuts while other departments such as Police and Fire took none.
If anyone sincerely doubts the above statements, then Come be a stand up person and see firsthand for yourself. Thank you
The City had someone doing audits, but they cut the staff. Reading is fundamental.
Thank you for publishing my response yesterday. It’s a shame that Finance Department can’t openly come forward about the changes that are coming and all the turmoil. I’m surprised the City Manager Tony O’Rourke with his tremendous organizational skills still maintains a deficit in the PR department. I emphasize with Jobless Single Mom on Tahoe years ago being very much a family, caring community. But Tahoe community members are still vital-as the City works for them. Which is why, I strongly believe Tahoe members should be better informed. For example-Tahoe has been operating trhough summer without a Fire Chief and a loss of division heads. A Police Chief instead, now heads this up. Also, with all Public Works slated for being laid off shortly-there won’t be any regular employee’s to plow the streets this winter. To me-the 2 most important necessities in keeping Tahoe running are Fire protection and Snow removal.