Discussions by the council following City Manager Kelly Traynham’s presentation Tuesday of her budget message for the upcoming fiscal year financial plan centered on issues related to employee recruitment and retention.

In what was predicted to be a lean budget early on in the planning process, the city manager presented a balanced plan of $17,659,857 which calls for no increase in the tax rate and pulls $250,369 from fund balance.

The proposed financial plan includes a 5 percent cost of living adjustment which Traynham said is recommended to partially offset the impact of inflation on employee real wages.

(A public hearing on the proposed budget is scheduled for June 6 at 5:30 p.m. in the Lloyd Andrews City Meeting Hall on Jackson Street. See related story at this link)

“The development of this budget did not come without several economic and fiscal challenges,” Traynham said in the message. “Specifically, inflation in labor and material costs have placed pressures on operational budgets and the cost of projects.”

Addressing recruitment and retention, she said, “The city is experiencing an extremely competitive labor market and recruiting and retaining talent requires continued focus on employee compensation to recruit and retain high-quality talent to continue to provide high-quality municipal services.”

She said the budget does not include merit salary increases or employee bonuses.

Traynham said, however, the city is currently looking at competitive wages and trying to maintain its current workforce. “Five percent is extremely common statewide and all around us.”

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COLA and bonus

Councilman Carl Ferebee said it would be advantageous for the city to look at both a COLA increase as well as a bonus. “When I was an employee I wanted to get mine now,” he said. “I didn’t want to wait all year. If I got a $1,000 or $2,000 increase per year it took me 12 months to get that versus if I got a thousand-dollar bonus and three percent increase then I had mine then pretty much.”

Traynham said some employees who get a bonus might be inclined to leave to take a competitive wage job elsewhere. “The cost of living is very high. It has changed significantly in the last few years.”

Councilwoman Sandra Bryant said, “Five percent this year, next year we’re going to be paying that plus the cost of increase for medical, dental, vision. I understand the cost of living but the city is not growing. We’re having to come up with the monies. We want to retain our employees and I think it’s important that we do that.”

Ferebee said there are employees on the lower end of the city’s pay system who are struggling. “A five percent increase to them — I won’t say it won’t help them because it will — but it won’t help them to the point of a bonus plus percentage. The turnover is going to be higher now because this generation is different and they’re not going to hammer it out and stay there like we did and try to get that longevity.”

Councilman Wayne Smith said a 5 percent increase for a person making more than $50,000 to $60,000 is “a lot more money than someone making $25,000. There’s very little turnover in the higher-paid range than it is at the lower end of the scale.”

Ferebee said he wants the city to continue to look at alternatives. “I would like for us to look at starting, mid-point and max. I think that probably is a big hit. I think that is a big part of why people turn over and the way they turn over. I think that’s a hit. We need to really look at that seriously.”

Ferebee reiterated that he wanted city administrative staff to look at alternatives such as a bonus plus a COLA. 

Public works

During the department head reports later in the meeting Public Works Director Larry Chalker said he has five open positions and five frozen positions. “We’ve been dealing with the frozen positions but the open positions are people that are leaving and we’re having trouble filling those positions.”

He said, “When the city manager comes and tells you we need a COLA, that information is coming from us department heads from what we’re hearing from our employees. The employees have had a bonus without a COLA before and they do not like that.”

Chalker said he would be willing to do a formal or informal survey, “But what the employees tell us is they want a COLA so it will be there every year after. That’s how you get ahead and that’s how you advance. Inflation hits us every year. As a department head I’m getting to the point where I need a COLA too. I know we hear the discussion we need to get the money down to the people in the lower end of the organization and we do. Those people deserve to make more money but some of us department heads, we’ve been in here a long time and we deserve a COLA too.”

Traynham said bonuses are typically spent immediately on a need. “The cost of living would increase their salary as they’re paid so they at least know they’re getting additional revenue.”

Ferebee, however, continued to lobby for a combination. “If you go back and poll your people I guarantee you the combination of that would be advantageous for them and they would like that as well as give you guys an increase.”

‘Steadily losing officers’

Interim police Chief Gorton Williams told the council he currently has 10 openings. “I have two officers who are going to be departing from the police department next week. I’ve got two officers now in the hiring process for other jobs. So at the beginning of June I’m going to have 14 openings and it could be more and as of today I’ve only received one application for employment so I’m steadily losing officers.”

Fire Chief Jason Patrick said his department is currently five firefighters short. “We do have a few applicants and we’ll try to test some on June 3 when we’re doing our physical agility tests.”

As far as raises versus bonuses, Patrick said, “Bonuses are greatly appreciated but as Mr. Chalker said that raise sticks with you from year to year. If you give us a bonus this year, next year will we be able to build off of that if we don’t get a bonus? If we get a raise they’re able to build off of it.”

Patrick said he believes the pay issue is the reason the city is behind and hasn’t been able to keep up. “We’re extremely behind in a lot of places.”

Parks and recreation Director John Simeon said, “I’m the longest tenured department head here and I can tell you that hands down my employees want a COLA. The bonus has already been discussed but for all these years the COLA is what the employees want.”