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In response to an inquiry by Mr. Broznsky, Ms. McKeehan reported that fewer than 60 percent of salary costs are for employee benefits. Mr. Brozosky asked what the industry standard was for benefits in the private sector. Ms. McKeehan mentioned that traditionally, the private sector was running about 30 to 40 percent. Given what has happened with workers compensation, there are a number of classifications now where workers compensation premiums are 100 percent of the payroll. She believed the market place had really changed with regard to the standards they are looking at, and structural changes need to be made, such as in health care. She noted that the City's health care costs are low compared to what others are paying. Mr. Brozosky pointed out the City pays 100 percent of employee's medical expenses, assuming they go with the Kaiser Family Plan. He asked if the employees paid any portion of their medical upon retirement? Ms. McKeehan noted that it depended on the years of service. If an employee has a career position with the City or the employee has worked a number of years, the employee may get to the point that the medical benefit is fully covered. Ms. Brozosky wondered if an employee who was working for the City today had any deductions for retirement? Ms. McKeehan said this was a different question. Prior to her employment with the City, there was an exchange made between the City and the employees, at the City's request. Employees were asked in-lieu of taking a compensation increase, to have the City pay their retirement conla'ibufions, which they agreed to. Moving forward in time, this still shows up in total compensation and in comparisons with other organizations. Most other organizations have done this as well. Ms. Ayala referred to the 2003 salary adjustment comparison sheet provided by staff and asked if she was looking at the correct sheet. Ms. McKeehan noted that the comparison sheet was only for fire personnel and was provided to Council in dosed session. To make it clear to the employees of the City, Mr. Brozosky stated that he was looking at this matter as a policy issue, and not at any one person or position. If he were working for a corporation and he proposed a five percent increase per year in today's economy, he would probably be fired. He was concerned that things were spiraling out of control. He did not believe it was a problem in Pleasanton, but it was a common problem with the way government separates itself fxom private industry and uses only other public entities for comparisons. He thought using government entities is too narrow, and would like to see a survey as to how employees are paid throughout the Pleasant City Council 18 10/21/03 Minutes