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Personnel Board discusses FY26 merit-pay approach; no cost-of-living raise expected
Summary
Staff told the board that, given tight budget projections, there would likely be no cost-of-living adjustment for FY26 and most nonunion employees would receive a one-step increase (roughly 2%) contingent on successful performance; final decisions await the town-manager budget submission.
The Personnel Board discussed nonunion merit-pay calculations for fiscal 2026 and was told Feb. 12 that town staff expect no cost-of-living adjustment (COLA) and that most employees will receive a one-step salary increase, estimated at about 2%, contingent on successful performance evaluations.
Jess said historically merit increases were calculated on the salary as of June 30 (the closing year), and that last year’s use of a different base was an anomaly. She said budget constraints make a COLA unlikely this year and that “the bulk of the employees... will move a step,” with only a small number already at top step who would remain there but could be eligible for cash merit payments.
Board members asked whether merit payments were an accrual from the prior fiscal year or funded in the new budget year; staff said budgeting practices vary and encouraged questions during the upcoming budget deliberations. Jess said she expected clearer information after the town-manager’s final budget is presented at the end of the month and planned to return with specifics at the March meeting.
Board members signaled support for using the closing-year salary as the base for merit calculations, consistent with past practice, and asked staff to bring definitive numbers when the budget is finalized.
