In a well-attended and highly combative mayoral debate sponsored by organized labor, the elephant in the room - the city's 2 percent cap on salary hikes - was allowed to hide.
Few issues animate labor interests more - or affect the city budget more - than salaries. Mayor R.T. Rybak and the City Council majority have imposed the salary cap as part of the five-year budget to cope with state and federal aid cuts.
The cap doesn't solve the city's budget problems. Even with 8 percent annual property tax increases and the wage cap, the city's five-year budget foresees more staff cuts in coming years. Going above the 2 percent limit means more cuts and/or finding new money.
Before hundreds of people April 14, Rybak and Hennepin County Commissioner Peter McLaughlin answered 75 minutes of questions about everything from closing the University of Minnesota's General College to their support for private-sector union organizing.
Yet Rybak, an architect of the 2 percent cap, was not asked to defend it. Similarly, McLaughlin - who is backed by AFSCME Council 5, Fire Fighters Local 82, Minnesota DRIVE and Steelworkers Local 12103 - wasn't asked to stake out his position.
William McCarthy, the Central Labor Union's president, said he was surprised the question didn't get asked.
Jim Niland, AFSCME Council 5 political director, said his union disagrees with what he calls the city's "2 percent box."
"That is why we are active in this year's Council and mayor's race - to get out of that box," Niland said prior to the debate. "We don't like the box."
Which way wages?
During the debate, Rybak pointed out that the city had settled 18 contracts without a strike during his tenure. Together, management and labor have held down health insurance costs.
McLaughlin touted his strong labor record at the State Legislature and the county. He has walked picket lines in the cold and urged private employers to sign neutrality agreements allowing union organizing, he said.
After the debate, the Journal pressed both candidates on the salary cap issue.
Rybak said he would like to improve employee wages, but, "I am not making any long-term commitments on that. We have had to do tough things in tough times."
McLaughlin did not give a yes-or-no answer about lifting the wage cap.
"I don't negotiate contracts in the newspaper," he said, saying it was bad for labor/management relations.
Asked about workers' frustration with the wage cap, McLaughlin said wages were an issue but "not the heart of the issue."
He pointed to a recent city employee survey showing worker dissatisfaction. He said unhappy workers are less productive and less creative. "It is an indictment of the current administration and its management - they ought to be ashamed," McLaughlin said of the survey.
"If I were on the board of directors of a corporation that had a report from the employees about employee dissatisfaction that was as negative as that report, I would be thinking about firing the chief executive, and that is what the people of Minneapolis ought to do," he said.
The city released the results of the anonymous, voluntary survey in December. It covered 1,800 workers, or nearly half thecity's workforce.
Some negative findings included: only 32 percent of respondents felt elected officials - mayor and City Council - valued their work, and just 39 percent said department morale was positive.
Some more positive findings were: 89 percent of respondents said they believed the quality of their work was important to the city's overall success, and 75 percent said they were satisfied with their job.
Rybak said he was proud of the survey, the first done citywide. Employees had been through tough times with budget cuts, and he wasn't surprised some aren't happy. "I'm not happy," the mayor said.
Every department business plan and management review this year must address how to improve issues raised in the survey, he said: "That is good management."
The money fracas
In discussing the salary cap question, McLaughlin framed his responses in terms of what he called wasteful decisions by Rybak and the city.
The implication: less waste means more money for staff and salaries.
McLaughlin criticized the cost of multi-agency merger that created the Community Planning and Economic Development Department, and said he could find some savings there. He criticized the Rybak administration for what he said was overpaying management compared to front-line workers.
Rybak said that it would be helpful for McLaughlin to do a budget to show how his ideas add up.
McLaughlin has repeatedly charged that Rybak botched the pension issue, leaving millions of dollars on the table.
The city has three closed pension funds: Minneapolis Employee Retirement Fund (MERF), the Minneapolis Police Relief Association (MPRA) and the Minneapolis Firefighters Relief Association (MFRA).
McLaughlin criticized the mayor's handing of all three funds, saying he "mismanaged" and "bungled" MERF's problems with a slow response - and suggested the Journal call MERF for a comment.
Judith Johnson, MERF's executive director, said Rybak could have saved a relatively small amount of money had he acted as soon as he got into office, but she said he had neither mismanaged nor bungled his responsibility.
"I find no fault with this administration," Johnson said, adding Rybak inherited the problem. "At least they are dealing with their deficits, which I didn't find to be the case with the prior [administration]."
Rybak and McLaughlin also differ on the police pension fix. The mayor and Council majority rejected an MPRA bill that would have increased state aid and retirement pensions. They said it passed the buck to future generations. McLaughlin said the measure would have saved the city millions of dollars.
City pay vs. county pay
Rybak noted that the city had capped wage increases at 2 percent while Hennepin County had frozen workers' wages.
McLaughlin said the freeze didn't apply to the "step" increases employees get if they are not at the top salary.
Rachel Gilchrist, county human resources staff, said 68 percent of county workers are at top pay for their grade. Step increases for the rest average 5 percent. The county's overall payroll increased 1.5 percent in 2004, and a similar increase is projected for 2005, she said.
The Central Labor Union, the umbrella group for 125 area unions and the official AFL-CIO endorsement, has not backed either candidate yet, McCarthy said.
McLaughlin "has answered the call" anytime that labor has gone to him, McCarthy said. Rybak hasn't hurt labor, but neither has he embraced it.
"[Rybak] is committed at this point - or at least he tells us now - that he wants to change that relationship," McCarthy said. "Of course, he is looking for our endorsement."
The Central Labor Union won't endorse until after the city DFL convention May 14, McCarthy said. "It's best to wait."