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Home My WebLink AboutMINUTES - 08171993 - 2.4 - ..ti........ . . Contra T0: BOARD OF SUPERVISORS � ,Costa o. ;nlla�► ' FROM: Phil Batchelor County Administrator oo '- •'�v, �u' "� sra cavK'� DATE: August 17, 1993 SUBJECT: Performance-Based Incentive Plan SPECIFIC REQUEST(S) OR RECOMMENDATION(S) & BACKGROUND AND JUSTIFICATION RECOMMENDATION(S): 1 ACKNOWLEDGE that massive reductions in County funding through the State seizure of local property taxes necessitates a complete rethinking of County government services, including new ways to encourage efficiency and effectiveness of County programs. 2. AUTHORIZE the County Administrator to establish the Performance-Based Incentive Plan, including financial and management incentives that would increase the flexibility of departmental operations and provide additional resources for the department. 3 AUTHORIZE the County Administrator to offer the Performance-Based Incentive Plan to all department heads acknowledging, however, that the extent of participation by elected department heads is subject to their discretion. 4. SUPERSEDE the March 30, 1989 Board Order on evaluation of unrepresented employees and AMEND the previously approved Department Head Evaluation Program in accordance with the proposed Performance-Based Incentive Plan: -- CONTINUED ON ATTACHMENT: _YES SIGNATURE: dam: RECOMMENDATION OF COUNTY ADMINISTRATOR_RECOMMENDATION OF BoA54b6mMITTEE APPROVE _OTHER SIGNATURE(S): ACTION OF BOARD ON Au st- 17, 1 AAS APPROVED AS RECOMMENDEDX_OTHER X Supervisor McPeak included in her second to the motion clairifcation that there will be in the near future a process that finalizes performance standards and objectives in each department, and that the County Administrator is working on a process to have within each department employees evaluated according to their contribution to performance standards. VOTE OF SUPERVISORS I HEREBY CERTIFY THAT THIS IS A X UNANIMOUS (ABSENT ) TRUE AND CORRECT COPY OF AN AYES: NOES: ACTION TAKEN AND ENTERED ABSENT: ABSTAIN: ON MINUTES OF THE BOARD OF SUPERVISORS ON THE DATE SHOWN. Contact-Sara Hoffman,646-1390 ATTESTED August 17, 1993 PHIL BATCHELOR,CLERK OF THE BOARD OF SUPERVISORS AND COUNTY ADMINISTRATOR cc: CAO . Department Heads , BY— ,DEPUTY h3l:perfplan.bos i,_ I BACKGROUND/REASON(S) FOR RECOMMENDATION(S): New Era for County Governments Historically, the State has underfunded County government through its allocations of specific programs, such as capping its payments on services, while continuing to require the County to provide those services. The County has taken its local property tax revenues to backfill many of these State underfunded programs. Over the past two years, the County's ability to continue these actions has diminished considerably. The State seized millions of dollars of local property tax revenue from Contra Costa County. This is the County's largest, most stable source of local revenue. In partial recompense, the State has authorized a portion of the sales tax be allocated to the counties dependent upon the outcome of the November election. This shift of sales tax ignores the realities of increased demand for County services during recessions and hard economic times when sales tax receipts are usually at their lowest. Contra Costa County must now meet the demands for continuing services with fewer resources. The administrative staffs have been cut back considerably, reducing the County's departments' abilities to develop the comprehensive goals and objectives of the past. Performance-Based Incentive Plan Recognizing the new fiscal realities for Contra Costa County, the Board of Supervisors adopted guidelines for new performance-based budget system for the FY 93-94 budget process. This system included identification of measurable performance indicators for each department. The Board directed the County Administrator to assure that departments focused on key objectives. These objectives. would be measurable so that anyone could see whether or not they were achieved. The proposed"Performance-based Incentive Plan" responds to these Board directives. The plan would tie performance indicators to departmental incentives, including increased management flexibility and department head performance evaluations. Participating departments would be required to develop performance indicators for three to five key objectives (possibly more for larger departments). The performance indicators would measure the efficiency and/or effectiveness of these efforts on a programmatic and/or policy level. For example, the effectiveness of a program could be measured by the degree to which achieves its desired outcome, while the efficiency of a program could be measured by the cost of achieving each unit of outcome. For example, performance indicators for the General Assistance (GA) program in the Social Service Department could include: Ob ective: Promote self-sufficiency among GA recipients. Performance Indicators: 1. Percentage of GA recipients participating in Workfare training by number of hours per month. 2. Number of job interviews per GA recipient per month. 3. Percentage of GA recipients in Job Club who obtain employment. 4. Percentage of Work Incentive participants not on GA after 6 months. 5. Number of GA recipients graduating from General Assistance Alcohol and Drug Diversion Services (GAADDS) or "dropping out" due to employment (and consequent ineligibility). Obiective: Limit GA support to eligible individuals. Performance Indicators: 1. Cost/Cost Avoidance per fraudulent GA application detected. 2. Number of sharing-housing recipients identified. I 2 i Obiective: Assist unemployable GA recipients to obtain and maintain SSI aid. Performance Indicators: 1. Number of GA recipients who obtain SSI. 2. Number of SSI recipients who lose SSI eligibility and return to GA. 3. GA aid reimbursement from the federal government compared to program cost. Plan Incentives Two types of incentives would be provided to participating departments to maximize their performance: • Financial Incentives • Management Incentives The financial incentives would be funded through a portion of the fund balances of the department; however it is recognized that there are dramatic differences in the ability of departments to affect their final fund balance. Some departments have considerable potential to generate revenue, while others do not. Size alp affects the potential of departments to affect the fund balance. All departments, however, have the ability to control their expenditure through productivity and cost avoidance,. As a consequence, the County Administrator would establish a central fund from all fund balances that would support financial incentives for departments with limited revenue generating ability and/or are very small departments. It would be clear, however, that no department, regardless of size or financial status would be eligible to receive financial incentive if the fund balance was a zero or minus. It is proposed that the County Administrator be authorized to allocate not more than 40% of a department's fund balance for the financial incentives. The exact particulars of the amount and circumstances would be negotiated for each department depending on the individual circumstances. Financial incentives could be used for one of two purposes: 1. One time expenditures to increase productivity, automation, streamlining of operations or improve service delivery. The department would be required to allocate at least one-half of its financial incentive to productivity measures. 2. Performance incentive pay - Both unrepresented employees and represented employees (subject to meet and confer as appropriate) would be eligible to receive one time performance incentive pay if they receive an outstanding performance evaluation and are part of the department's approved performance plan. The financial incentive for individual employees would be required to be specific to that employee's performance and departments would not be permitted to provide "across-the-board"financial incentives to all employees. The department would be allowed to allocate up to one-half of its financial incentive to performance incentive pay. Management incentives could include such flexibilities as lifting the freeze, increased authority for personnel action, increased authority in purchasing and other areas of interest to the department upon approval of the County Administrator. All management incentives would be effective for the following 12 months. Their continuation would be dependent upon the next performance rating. Departments would have greater latitude and flexibility in the management of their department, although the County Administrator's office would continue to monitor budgets to ensure the fiscal integrity of the County. Incentive Plan Evaluations Each department's performance-based incentive plan would be subject to the review and approval of the County Administrator. Financial and management incentives would also be subject to the Administrator's review and approval. Incentives would be authorized only for results directly attributable to the department's actions. I i 3 I r Elected department heads would be invited to participate in the performance-based incentive plan. However, it is recognized that some elected department heads in the past have expressed concerns that incentive payments or incentive plans could be used inappropriately by political opponents. Consequently, the extent of participation by departments with elected department heads would be subject to their discretion. The performance incentive plan would be incorporated into the department head's performance evaluation process. Department heads would still be accountable for: • management and leadership skills; • improvements to public service standards; • generating and implementing innovative ideas; • increased productivity; • control of inappropriate sick leave usage; and • improvement of the affirmative action status of the department. Implementation The department performance plan would be evaluated every 12 months, at which time the plan for the following year would be reviewed and negotiated with the County Administrator. Implementation would be staggered the first year to ensure that adequate attention was given to each department, which would not be possible if they were all scheduled the same month. Scheduling of departments will take into account both the readiness and interest of the department in participating in the incentive plan. The performance-based incentive plan will focus on a few important objectives of the department. It is not designed to be a comprehensive evaluation that diverts scares administrative resources from the enormous task of providing cost effective, efficient services to the citizens of Contra Costa County. The County Administrator will be preparing implementation guidelines that include details and procedural refinements. These guidelines will be discussed with department heads in the near future. I I 4 i