City proposes significant budget changes amid rising costs

In a recent government meeting, officials discussed significant budgetary changes, including a proposed 6.7% tax increase and adjustments to employee compensation amid rising costs of living. The proposed budget for 2025 is set at approximately $101.3 million, reflecting a net increase of $7 million, primarily driven by rising expenditures in employee contracts and utility rates.

Key highlights from the meeting included the approval of a new contract for the Police Benevolent Association (PBA), which includes a 4% cost of living adjustment and a 3% step progression. In contrast, negotiations with the firefighter union are ongoing, with their pension contribution rate significantly impacting future contract discussions.

The decertification of the Labourers Union (LiUNA) on June 26 means their compensation will now align with nonunion rates, leading to a proposed flat 3% annual increase for all nonunion employees. This adjustment is expected to add approximately $1 million to the general fund, affecting 618 positions across various departments. Officials acknowledged that while this increase aims to address wage compression issues, it may not fully meet the financial pressures faced by lower-earning employees.

The meeting also addressed the rising costs of property insurance and the economic challenges impacting employees, particularly those earning below $40,000. Officials noted that the current economic climate necessitates these adjustments to retain staff and fill high-vacancy positions.

Additionally, the water and sewer funds are projected to increase by 13.01%, attributed to an 8% rise in utility rates effective October 1. The council is also considering adjustments to the current millage rate, which has seen a gradual decrease since 2016, with discussions on whether to maintain or exceed the current rate.

Overall, the meeting underscored the financial challenges facing the local government and its workforce, as officials strive to balance budgetary constraints with the need for competitive compensation and essential services.