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City ponders larger raise for employees

City ponders larger raise for employees

City ponders larger raise for employees

Improvement in the economy after years of austerity has led to a discussion of whether the city of Statesboro should give its employees a 2.5 percent raise instead of a smaller raise and another one-time bonus.

Toward the end of Monday’s all-day budget work session, City Manager Frank Parker addressed the mayor and council on the state of the current, fiscal year 2014 budget and the outlook for the 2015 budget, which will open July 1.

“We will increase our reserves in the general fund and most of the enterprise funds this year,” Parker predicted.

The 2015 general fund budget he suggested shows a slight, about $6,000, reduction in spending from this year’s budgeted amount, with expenditures and revenues for both years rounding to $13.7 million. The general fund amounts to a little more than one-fourth of the city’s total budgets, which for the current year total more than $51 million.

The projections also showed general fund revenue contracting by about $10,000, despite marginal growth in tax revenue, because of declines in other revenue sources, such as permits and fines.

But Parker predicted that the city will be able to conclude the current fiscal year with about a $550,000 reserve in its general fund and should grow the reserve to about $600,000 next year. Fee-based funds, such as those of the natural gas, water-wastewater and solid waste departments, have their own reserves.

Noting that the general fund has been the area of greatest struggle, Parker mentioned that cuts had been made in the budget as presented for council’s consideration.

 “To make the budget work, we’ve cut in a lot of different areas just a little bit rather than one major item any one particular place, and we well could have some additional annexations this year with some costs involved in expanding services,” he said.

Still, the projections he and Finance Director Cindy West presented were conservative, Parker said. He expressed hope that next year’s budget would result in revenues slightly higher, and expenses slightly lower, than the predicted levels.

He also noted that he was not expecting City Council to vote any property tax increase. Parker then recommended the 2.5 percent pay increase and a $100 Christmas bonus. Last year, city employees received a 1 percent raise accompanied by a promise for several hundred dollars in bonuses. They reportedly have received one, $400 bonus.

Something similar has been done for several years.

But the 2.5 percent raise would provide a cost-of-living raise in the framework of the job classification and pay plan prepared by the Carl Vinson Institute of Government and adopted by the City Council in 2006, Parker suggested.

“You’ve seen all our employees stepping up to the plate and doing more, more productive, more dedication, and morale has a lot to do with that,” Parker said. “I think this goes a long way to showing our employees that they’re appreciated.”

The raise he suggested had been built into the budget figures.

However, Councilman Will Britt, who had already asked where the money was going to come from to add three more police officers next year after three were hired this year, noted the relatively small increase predicted in the year-end balance.

 “That two-and-a-half percent will cost the city $300,000,” Britt said. “I don’t know if it’s there. We’re only increasing our reserve $50,000.”

Only about half the money, or around $150,000, would be from the general fund, Parker said. The rest would be from enterprise funds with their own reserve levels.

Britt said he liked the idea of a bonus and 1 percent raise like those of recent years.

But this practice has caused employee morale to plummet, Water-Wastewater Department Director Wayne Johnson told council members. Employees, he said, cannot budget living expenses on a promised bonus. Nor, he observed, do bonuses count toward retirement.

“Our working employees are struggling, and if this job market turns around, we get a major industry into this town, we’re going to lose the lifeblood of the city of Statesboro,” Johnson said. “We’re going to lose those young employees that have invested 10, 15 years of their life in the city of Statesboro with the intention of staying here there whole career because we’re not competitive.”

Probationary and merit increases, previously frozen, would remain so under Parker’s proposal. During his four years as city manager, all raises combined have totaled 3 percent for hourly wage workers and 2 percent for salaried, Parker said.

The current year’s arrangement had included a promise of a further bonus in June if the city’s finances would support it, Britt said.

Figuring the total for the previous and promised bonuses at about $270,000, Mayor Jan Moore said that a raise costing roughly $300,000 wouldn’t be that different.

“I’m not seeing a monetary difference other than the fact it’s perpetuated, versus potentially voted no,” Moore said. “I’d say in good faith, if the money looks the same to go ahead and do it … go ahead and give the raise.”

Britt said he might consider a graduated raise, with 2.5 percent going to the lowest-paid employees and a smaller percentage to those higher on the pay scale.

Councilman Travis Chance asked how sustainable the raise would be and whether it would max out the city’s ability to react to other changes without a tax increase.

“Our job and what we’re tasked to do is to be good stewards of the tax dollars, to take care of our employees,” Chance said, adding that part of that would be avoiding layoffs in the event of an economic downturn.

No votes were taken at Monday’s work session and the budget was not on the agenda for Tuesday’s regular meeting. The council usually adopts its budget in May or early June.

Al Hackle may be reached at (912) 489-9454.

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