Council compromises on compensation after split votes derail two plans
Published 7:42 pm Thursday, February 17, 2022
City Council compromised on a compensation plan for city employees, and resulting from it will be a step plan, regular pay increases and a citywide minimum wage of $15 per hour.
After a pair of 4-4 votes defeated two different compensation plans for city employees, council voted 6-2 in favor of a compensation plan that provides for a 2.5% incremental pay increase and a 60% credit for time of service. The plan will be prorated for the current fiscal year beginning in April and then fully implemented in July with the start of fiscal 2023.
City Manager Al Moor had recommended a plan calling for the same 2.5% incremental increase for city employees with a 50% credit for time of prior service and 50% credit for time in their current position. In voting against the compromise, Mayor Mike Duman and Councilman Tim Johnson supported the 50%/50% proposal.
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However, four members of council — Roger Fawcett, Donald Goldberg, LeOtis Williams and Vice Mayor Leroy Bennett — supported a 70% methodology that called for a 2.5% incremental increase and a 70% credit to employees for their time of service.
After the first 4-4 vote defeated the 70% methodology, the same four supported a compromise motion for a 65% longevity plan that would have cost nearly $8.36 million in the first year, with more than $1.23 million in projected overtime costs. Again, the motion failed.
The total cost for the 60% plan is just over $7.8 million with $1.15 million in projected overtime costs. The 50%/50% plan would have cost about $6.75 million with $970,000 in projected overtime costs, while the 70% plan would have cost close to $9.1 million, with $1.4 million in projected overtime costs.
As part of a market analysis in preparing compensation plan proposals, Evergreen collected salary data from South Hampton Roads cities, along with Newport News, using that data to develop recommended pay scales. The market analysis incorporated a minimum $15 per hour rate.
In recommending the 50%/50% plan, Moor cited fiscal 2023 budget considerations. They included:
- Increased debt service: $988,000
- Anticipated Suffolk Public Schools additional request: $1 million to $3 million
- Suffolk Center for Cultural Arts additional request: $1 million
- Increase in risk budget: $1 million to $2 million
- Increase in overtime due to the compensation study: $970,000 to $1.4 million
- Inflation impacts
- New budgeted positions (minimum of 18 new firefighters at $1.3 million)
- State legislation impacts to revenues
- Tax rate adjustments (1 cent equaling about $1 million in real estate taxes)
“The impacts, to me, on this plan, seems affordable as we look at our budget growth this coming year, FY ‘23,” Moor said.
However, Goldberg said he was looking long-term at the compensation issue in supporting the 70% methodology — “I want to get it right, I want to get it fixed (and) I want to get it done, he said — and Fawcett said that plan “brings our employees to the market across the board. It does not, in the 50/50 plan take it to market and we are not going to be competitive when these other cities come online and start doing their pay plan.”
Fawcett said the compensation issue is about every city employee.
Council next will need to adopt ordinances in March to fully adopt the compensation plan and appropriate money for the current fiscal year cost, and amend necessary city code sections. The plan is then set to be implemented in April after the new pay system has been completed and tested.
Of the $7.8 million for the 60% longevity compensation plan, $3.4 million will go toward sworn public safety staff in the first year, with $277,360 for non-sworn public safety staff and another $844,170 to go toward benefits for public safety staff. More than $2.68 million would be spent for general employees and another $613,083 would be spent on their benefits in the first year of the plan.