September 17, 2008 – Butkovitz Recommends City Go Paperless in Payroll

Audit Date: September 17, 2008
Audit Categories
  • Financial
Controller: Alan Butkovitz

Executive Summary

For Immediate Release:
September 17, 2008

Contact: Harvey M. Rice

Butkovitz Recommends City Go Paperless in Payroll
Cites Savings of Up To Half a Million Dollars per Year While Going Green


(Philadelphia) –Today, City Controller Alan Butkovitz released his report, “Paperless Pay: Saving Tax Dollars-Protecting the Environment”. This report was prepared as part of an ongoing effort by the staff of the City Controller to explore ways to minimize operating costs and make more funds available for essential services.

Butkovitz stated, “Printed pay checks and pay-stubs for city employees and pensioners use more than one million pieces of paper annually and cost Philadelphia taxpayers up to $500,000 in materials, labor and postage. Moving to paperless paychecks (direct deposit/debit cards) will increase productivity and eliminate unnecessary expenses.”

Butkovitz continued, “In addition, it will help advance the City’s sustainability goals by eliminating almost 5 tons of paper per year and saving more than 130 trees. A transition to paperless pay would place Philadelphia in the vanguard of municipal governments in green operating policy and set an important precedent in the City and the region.”

The report found that the environment effects of eliminating almost 6 tons of paper would be avoiding the 94.4 million BTU’s of energy required to produce it, in addition to 56,600 gallons of waste water, 6,300 lbs of solid waste and 12,300 lbs of carbon dioxide released into the atmosphere.

Almost thirty percent of the nearly 63,000 active city employees and pensioners are paid by paper check.

In addition to the environmental factors and the savings to taxpayers, other advantages of a paperless payroll system include: eliminating trips to the bank and less vulnerability to loss and theft of cash.

Butkovitz made the following recommendations to the Finance Director for implementation of a Paperless Payroll System:

• Direct deposit or debit cards should be mandated for all City employees and pensioners.

• Debit cards can be issued, at cost, to those who choose not to enroll in direct deposit.

• Individual payroll information should be made available electronically to employees.

• The City should develop an Employee Self Service website with relevant records, including payroll, leave status, and benefits. Employees not assigned a PC should be provided access, for instance, through kiosks in employee lounges or other methods.

• The transition to paperless should be accompanied by training seminars for all employees on a voluntary basis.

• The City should work with banking institutions to facilitate the provision of “second chance” accounts for employees who need them.

Butkovitz concluded, “The time has come for city government to use the technological tools that are available. In this time of budget constraints moving to a paperless pay system we will save a half a million dollars a year, while at the same time taking the necessary steps to move the Philadelphia forward as an environmentally sustainable city.”