Burlington’s city council has decided to light up city hall with pay raises and bonuses this holiday season thanks to the unexpectedly robust revenues that the city has seen this fiscal year in spite of the lingering coronavirus pandemic.
The council approved these mid-year increases on Tuesday along with a number of other appropriations that were omitted from the city’s annual budget due to initial concerns about the pandemic’s financial impact.
The spending package that the council adopted that evening includes a 1.5-percent “merit-based” raise for most of the city’s full-time employees. The council also agreed to fill 13 “mission-critical” positions that had been frozen in response to the pandemic, and it set aside another $63,000 for external organizations that had seen their usual allocations trimmed back this year.
The council approved these allocations at the behest of Burlington’s city manager Hardin Watkins. But its members also threw in some treats of their own, including $500 bonuses for fulltime employees who earn up to $24 an hour and an extra $300 for many a part-timer with comparable wages.
The council’s prevailing stance on these year-end gifts was perhaps best summed up by mayor Ian Baltutis shortly before Tuesday’s unanimous vote.
“This is a great opportunity to reward and recognize our employees who have put in tremendous work this year,” Baltutis declared. “They have not missed a beat since this pandemic hit.”
A welcome windfall
The council ultimately approved all of these stocking stuffers on the strength of a financial report that it received from the city’s top brass during a regularly-scheduled work session on Monday.
During the work session, the city’s finance director Peggy Reece informed the council that the city’s property tax receipts were about $580,000 ahead of where they had been at this time last year. Reece attributed much of this unexpected bounty to the low interest rates that have helped drive the local housing market.
The council also received some good news from Burlington’s city manager Hardin Watkins about the city’s sales tax receipts. Watkins told the council that, between June and September, the local levy on retail transactions brought in 10.27 percent revenue more than it had during the same stretch of 2019. He added that the windfall has left the city with roughly $492,000 more than it budgeted for the same four-month period, which includes the final month of the previous fiscal year along with the first quarter of the current financial cycle.
The financial picture that Watkins and Reece painted on Monday was much sunnier than the outlook six months ago when the council adopted the city’s current annual budget. At the time, the city’s administrators were predicting a plunge of more than 11 percent in sales tax receipts as well as substantial reductions in other revenues, such as the city’s hotel occupancy tax and fees from recreational programs.
Watkins reminded the council at Monday’s work session that he had frozen 26 positions during the opening months of the pandemic in anticipation of these prospective decreases in revenues. The city manager also recalled the across-the-board cuts that he had imposed on the city’s departments. He conceded, however, that many of these austerity measures have proven unnecessary thanks to the resilience of the city’s sales and property tax revenues. He also acknowledged the benefit of $534,000 in federal pandemic relief that the city has received under the Coronavirus Aid, Relief, and Economic Security, or CARES, Act.
“We have been able to use CARES Act funding for some of our needs,” he went on to inform the council, “and revenue receipts, as we hoped back in June, are higher than projected.”
Sharing the wealth
Watkins told the council that these sundry infusions of revenue have left the city with enough money to cover many of the expenditures that were nixed from the current year’s budget.
The city manager had previously promised the council that some of these cuts could be restored if the current year’s revenues wound up exceeding the budget’s predictions. Among the items that he hoped to revisit was a 1 percent “merit-based” pay raise that he had incorporated into the budget but chose not to implement until he had a better handle on the city’s financial position.
During Monday’s work session, Watkins assured the council that the city’s finances were solid enough to allow the $147,200 outlay that he earmarked for the 1 percent raise. He went on to encourage the council to allocate another $73,600 in order to tack another half a percentage point onto this “merit-based” increase.
Watkins said that this combined sum of $220,800 would permit him to bestow a 1.5 percent raise on every full-time employee with “satisfactory” job performance – minus the city’s most recent hires and those with disciplinary issues. He also noted that the increase wouldn’t apply to the city’s police officers, who are covered by a separate compensation plan that allowed them to receive raises earlier this year. The city manager added, however, that this increase would provide a much-needed boost to many other municipal employees who’ve gone beyond the call of duty in their response to the coronavirus pandemic.
“It will go a long way,” Watkins said with respect to the merit-based raise, “and our folks have done some amazing work.”
In addition to the proposed pay raises, Watkins asked the council for permission to fill 9 full-time and 4 part-time positions that he had frozen in the opening months of the pandemic.
Watkins told the council that these 13 “mission-critical” posts were tasked with important duties in areas like building and recreation maintenance, cemeteries and grounds, street repair, solid waste disposal, animal services, and water line maintenance. The city manager added that he has already unfrozen three other slots in recreation, street maintenance, and the fire department, but he assured the council he has no immediate plans to fill the 11 other positions that have been left open due to the coronavirus pandemic.
The city manager also proposed other allocations for external organizations and programs that have been short-changed by the city’s current annual budget. He recommended one outlay of $23,000 for Residential Treatment Services, which would offset tax revenue that this organization has lost due to the pandemic-related closure of bars and related establishments. Watkins suggested another $12,500 for the local chamber of commerce, whose annual allowance had been trimmed back in the budget, and he requested $27,500 to cover some technological enhancements to the wellness program that the city provides to its staff members.
Gifts from the council
The 1.5 percent raise that the council approved on Watkins’ advice wasn’t the first remunerative pat on the back that the city’s municipal workforce has gotten since the start of the coronavirus pandemic. In fact, the budget which the council adopted in June bestowed a one-time bonus of $500 on each of the city’s fulltime employees as a consolation for the deferral of their usual merit-based raise.
The city manager’s mid-year compensation package didn’t initially include any other flat payments to city staff members. Watkins nevertheless broached the prospect of an additional bonus on Monday based on a suggestion that he had previously received from councilman Jim Butler.
The city manager ultimately let Butler brief the rest of the council on his proposal, which entailed some form of additional compensation or another to benefit staff members at the lower end of the pay scale.
“I was really concerned about some of our lower wage employees,” the councilman elaborated during the work session. “So, I asked Hardin if there’s a way we can boost those lower-level employees.”
The city manager’s response to Butler’s dilemma was to suggest a one-time bonus of $300 to $500 limited to the city’s 343 full-time employees who make $24 an hour or less. Watkins acknowledged that this sweetener would set the city back between $126,000 and $210,000 depending on the size of the approved payment. But the added expense didn’t discourage councilman Bob Ward from endorsing the proposed bonus during the work session.
“I’d be in favor of going with the one-time payment of $500 for the lower wage employees,” Ward told the rest of the council. “I think we can afford it, and I would like to move forward with it.”
“It’s certainly a morale booster for many of them,” added councilman Harold Owen, “and it’s frankly something that many of them can utilize.”
The council ultimately agreed to include this $500 bonus in the mid-year compensation package that it adopted on Tuesday. Yet, this consensus didn’t end Monday’s deliberations, which meandered along to address the financial plight of Burlington’s part-time employees.
The council’s discussion about the city’s part-timers began with an off-the cuff interjection from Baltutis.
“Has there been any thought to including part-time employees in this?” the mayor inquired after the council endorsed the aforementioned $500 bonus for lower-paid full-time employees. “They’re continuing to render service to the city and they’re also hit by the pandemic.”
After some dickering over various other options, the council settled on the idea of another flat payment for part-timers on the advice of councilman Harold Owen.
“What do ya’ll think of a $300 payment to those employees?” Owen asked the rest of the council.
“That makes it easy on Peggy [Reece],” Butler concurred, effectively clinching the deal.
The council agreed to extend this $300 bonus to any part-timers who works at least one day a week and makes no more than $24 an hour.
The council proceeded to give its unanimous nod to all of the proposed expenditures on Tuesday.