The Stephenson County Board voted unanimously Oct. 8 to approve the county's fiscal year 2026 budgets and to cap general employee pay increases at 4% across departments.

The decision comes amid discussion of rising health-insurance premiums, an unresolved shortfall tied to the county nursing center and concerns from department heads about retention and compressed pay scales.

Board members discussed options including performance-based increases or a bonus program targeted at long-term employees, but agreed the budget adoption was not the venue to redesign compensation structure. County officials said a detailed review of pay policy will start after budget adoption.

Board members noted health-insurance premiums are increasing by more than 15% for the coming year and that the county still faces a multi-million-dollar funding gap related to the nursing center; that hole was referenced several times during budget deliberations as a constraint on available funds.

The GIS/IT technician position was discussed separately because the employee's salary and benefits are paid from the GIS fund (recording fee revenues). The board agreed to apply the same 4% cap to that budget line while acknowledging the GIS fund balance is relatively healthy.

Supervisors and department heads raised repeated concerns that recent minimum-wage changes and years of uneven increases had left long-term employees behind newer hires. Board members said those equity concerns will be part of a planned compensation policy review to be developed after the budget is adopted.

Motion and vote: A motion to approve the FY26 budgets with a 4% general increase passed unanimously; board members present voted in favor and the motion carried.

The board directed staff to begin daylighting options for compensation policy changes and to bring proposals to committee for the 2026 budget cycle, rather than implementing any new bonus or nonstandard pay mechanisms immediately.