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How do I get a ‘rolling’ deal for myself?

Sunday, February 26, 2012
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I must say I am envious of some of these public contracts I’ve been looking at. My big regret is that I don’t have one myself.

First it was Edward Spychalski and his deal with the Saratoga Springs Housing Authority, the body that operates government-subsidized apartments for the old people and poor people in Saratoga.

Spychalski started work six years ago at a salary of $74,777 and now is making $152,000, which is not bad for a humdrum bureaucratic gig in a small, pleasant community like Saratoga. But even more interesting is how his employment is locked in, so that if the board of directors ever wanted to get rid of him it would have to pay him at least four years’ worth of salary, or $600,000, cash on the barrelhead, just to say goodbye.

Then it was Lawrence Spring, newly hired superintendent of the Schenectady City School District, who it turns out has a similar deal, requiring a minimum of two years’ worth of salary should the school board ever want to part ways with him.

It’s called a rolling contract. Five years in Spychalski’s case, three in Spring’s. The way it works is, every year the contract comes up for renewal for one more year. So in the case of Spychalski’s contract, after each year lapses, the contract gets extended for another year, so it “will always have a remaining five-year term,” in the words of the contract itself, which refers to this arrangement as an “automatic extension clause.”

Actually it will have five years left on it at the beginning of a new term, then that will wind down to four years and get renewed again. So depending on the calendar it will always have somewhere between four and five years to run.

By the same calculation, Superintendent Spring will always have somewhere between two and three years to go.

Which is very different from the normal understanding of a contract term. Normally, if you have a three-year contract, that means it runs out after three years and you start over. If you’re the employee and the employer doesn’t want you anymore, that’s the end.

Under one of these rolling deals, you always have a few years to go, and if the employer wants to get rid of you, he has to pay you for the remaining years even though you’re not going to work them.

For Spring, who was hired at $181,200 per year, that would mean a minimum of $362,400, not even taking into account the inevitable raises to come.

It’s probably too late for me, but I’m going to see if I can get one of these for myself. I have in mind 10 years.

I notice another item in Spring’s contract, and that is the conditions under which he can be fired, which are much tilted in his favor compared with the conditions that prevailed when the earlier, discredited Eric Ely was in office.

Since the school board didn’t see fit, or didn’t have the backbone, to fire Ely, despite having ample tools to do so, I don’t see the point of giving those tools away, but that’s what they did.

They could have fired old Ely simply by affording him a hearing with themselves as prosecutor, judge and jury, no appeal provided for. It was a very strong provision in their favor, which they shrank from using, preferring to “move on,” as the cliche has it, albeit it at a buyout cost of $100,000.

Under the new contract for Spring, a hearing-to-fire would have to be held before an independent hearing officer from the American Arbitration Association or the National Academy of Arbitrators, and it would be held behind closed doors. (Ely’s contract didn’t specify open or closed, and we news jackals would have fought for open, if it came to that.)

Well, as I say, it hardly matters. If the board couldn’t bring itself to fire Ely, it will never bring itself to fire any superintendent, even if it be Mephistopheles himself. I just take note that it surrendered the tools to do it, or at least the tools to do it handily.

But it’s funny how the pay and benefits for these public employees accumulate, isn’t it?

One of them gets a fresh lollipop, then another gets it, and pretty soon the lollipop is a standard part of the employment package and school boards say they have to offer it to stay competitive.

Winner or loser?

So, a woman from Schenectady by the name of Lynda Ferguson won $120,367 on a slot machine at Saratoga Casino and Raceway the other day, as the casino was pleased to announce.

But as far as I’m concerned, that’s only part of the story. The rest of the story is how much Ms. Ferguson has lost over the years. Without knowing that, the $120,367 in winnings is meaningless.

The casino did tell us that Ms. Ferguson is a platinum member of its so-called Player Extras Club, and a spokeswoman for the casino, Crystal Beauchemin, explained to me that this means she is a “pretty regular” customer, and has been one since she signed up in 2004, when the club began. Platinum, she said, is the middle level of membership, between gold and diamond, based on how much one plays.

Club members use a swipe card to enter a machine, and that allows the casino to keep track of all the customer’s activity, for purposes of bonus points and such things.

I asked if the casino thus had a record of all Ms. Ferguson’s wins and losses over the years, and Ms. Beauchemin said yes.

So naturally I asked what those wins and losses add up to, which to me is necessary information for a rounded story, and I was shocked, shocked when she replied, “We can’t tell you. That’s private.”

Private? After you just put out a press release about a big win?

But of course that’s the way it works. The casino, like the Lottery Division, never puts out a press release about anyone’s losses even though they know the losses perfectly well.

Some poor sucker can go into the casino day after day and lose his rent money and grocery money and maybe wind up embezzling from his employer, which happens, to keep his head above water, and we in the press never get an announcement about it.

It’s the last thing any casino or lottery operation wants you to know or even to think about.

But we do know the odds, and the odds are such as to eat you up if you’re a “pretty regular” player.

The payback on the slots at Saratoga is 92 percent, and at that rate, losing an average of 8 cents on every dollar you wager, you lose your shirt very fast, and your trousers too.

You might win once in a great while, if you’re very lucky, but if you play steadily year after year such as to be a platinum member of their little club, you will need at least $120,000 to get even, is my own personal wager.

The week in which Ms. Ferguson won her $120,367, customers at the Saratoga casino collectively lost $3.2 million, which worked out to a loss of $257 per machine, per day.

The numbers are pretty steady, day after day, week after week, year after year. The casino never loses.

 
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