Monday, February 26, 2024

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Bonus or raise in Elon town government? Why not both?

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Elon’s town council was in a giving mood Monday night as its members discussed for almost an hour how much of an increase in pay to bestow on the town’s 68 full-time employees.

The council members had asked town manager Richard Roedner to put together a recommendation for bonuses, which he presented to the council Monday night: a $2,000 end-of-the-year bonus for full-time employees and $1,000 for 18 part-time employees.

But as the council discussed the bonuses, discussion ranged into whether some higher, and more permanent, increase in salary increases should be given.

Town manager Richard Roedner reported that prior to the Covid pandemic Elon’s compensation for its employees “was near the top” compared to other local jurisdictions.   However, that rank has subsequently declined, he said.

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Discussion fluctuated between discussion about bonuses versus raises for town employees.

Present in the council chambers and asked for their opinions were fire chief Landon  Massey and police chief Kelly Blackwelder.  Both confessed that they had not actually lost any employees due to salaries, but said “talk” about leaving had become more prevalent in their respective departments.

Massey said he felt that the “good culture” of his department has prevented many defections.

While Blackwelder said there had been “significant turnover” in her department, she outlined that some of those were from retirements and even at least one termination.

Blackwelder also distinguished that bonuses “don’t help me hire” new employees, but are appreciated by current staff.  She gave as an example that “Gibsonville has attempted to recruit [from her department] blatantly.”

Mayor Emily Sharpe summarized the distinction.  Bonuses are “good for retention, but not for hiring,” she said.

Sharpe said that Elon “could easily afford a 5 percent pay increase.”  Sharpe added, “We’ve got to retain people who are good employees.”

Elon town councilman Quinn Ray and mayor Emily Sharpe

Lori Oakley, the town’s planner, noted that there were two vacancies in her department following two departures and that she had no applications whatsoever.  She added that Burlington had advertised a lower-ranking position that would be toward the upper end of the ones Elon is trying to fill.

The discussion took a turn from either-or when Jill Weston, the town’s downtown development director, suggested that instead of either-or with regard to bonuses versus across-the-board pay raises, why not entertain doing both.

While general council discussion focused on “sending a message” to employees by providing a bonus, and letting them know of the council’s commitment and plans for future increases, discussion soon turned to Weston’s suggestion of doing both.

“Good will only goes so far,” said council member Stephanie Bourland, adding “People are always the most important thing” in any organization.

Elon town council member Stephanie Bourland

Council member Randy Orwig said, “We really need to think about raising salaries in the next few years.”

Elon town councilmen Randy Orwig and Michael Woods

At one point, new member Michael Woods suggested a 5 percent pay raise along with a $2,000 bonus for all full-time employees.

However, logistical questions came up that Roedner had only prepared a budget amendment for the $2,000 bonuses, with an estimated cost of $188,000.

The  5 percent salary increase would cost $143,000 over the next six months, or half of the full fiscal year, which ends June 30.

While the town has contracted for a municipality-wide salary study to be performed early next year, council members were inclined to give a significant increase immediately, arguing that even with a 5 percent raise, the amount discussed, Elon’s employees would inevitably still be below the average.

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The idea of acting before the $12,000 study is conducted, however, raised questions for councilmen Quinn Ray and Monti Allison, who wondered what the point of the future study would be if the council bestowed a significant increase before its results were known.

The town gave another 5 percent raise as a part of the 2023-2024 budget which went into effect July 1.

Ray also pointed out the significant budgetary effect of a raise, which would then become a part of the baseline for future budgets, as opposed to a bonus, which is a one-time payout.

Council member Monti Allison also questioned whether the council was “throwing money” at a situation without adequate information about where the town stands relative to other jurisdictions, one of the issues the pay study is supposed to examine.

But Orwig responded that giving raises “was not throwing money at it.”

Orwig also emphasized, “I don’t think we like being at the bottom” of municipal pay scales.  “[Particularly] when a position cannot be filled, that’s a problem.”

Most councilmen were focused on the results of the report from earlier in the evening from accountant Becky Loy, who outlined that the town’s savings, at the end of June 2022, which represented  more than 100 percent of the town’s annual budget.

The Local Government Commission recommends that all municipalities maintain at least 8 percent in reserves.  Loy said most towns and cities have an amount equal to half or more of their budgets in savings. Roedner said that Elon’s stated target is to maintain a fund balance of at least 40 percent of its annual budget.

Ultimately, the council voted in favor of the original Roedner recommendation: a $2,000 bonus for full-time employees and $1,000 for part-time employees.

However, Roedner was also requested to bring back another budget amendment in January which would confer a 5 percent across-the-board raise for employees.

The bonuses were to go out in semi-monthly paychecks; the one with bonus scheduled to be issued the next day.

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