The San Luis City Council voted to implement a salary competitiveness policy that raises city pay to 97.5% of prevailing market rates, to create a longevity pay plan, and to authorize staff to make $1,200,000 in budget transfers to fund the changes.

Human Resources Director Adela Cortez told the council a 2024 salary study found the city was not a competitive employer: 83% of positions surveyed pay more than 5% below market and 257 current employees earn less than the proposed minimum for their classifications. Cortez said the consultants recommended bringing pay to market, but a finance analysis showed the city could not afford a full 100% adjustment immediately; the administration therefore proposed a phased approach beginning at 97.5% of market.

Cortez said staff recommended making the pay adjustments effective retroactively to the first pay period in January 2025 and that the city could implement a longevity pay plan in the near term. She described the longevity schedule as beginning after five years of total service: $1,000 at five years; $1,500 at 10 years; $2,000 at 15 years; and $2,500 at 20 years and above (the stated cap). Cortez also said the initial longevity payments would be limited to employees who do not receive a market adjustment; in later budget years the longevity plan could apply more broadly.

Council member Servin urged the council to consider larger longevity amounts, saying the proposed levels felt “really low” and asking whether the city could start at $2,000. Cortez replied that staff could analyze the fiscal impact of that alternative. Finance staff (Ms. Rola and Ms. Cinis) told the council they had identified available general-fund salary savings from current vacancies that could cover the retroactive pay period but warned that a remaining shortfall might require a later transfer from the contingency account. Staff estimated the retroactive cost for the January-to-March period at about $320,000 and described the total annual budget impact as previously calculated (staff language reported an estimate of about $1.5 million).

Council members asked how many employees would be affected by the initial longevity payments; staff said about 90–93 employees would qualify under the plan described. Cortez clarified that employees who receive a market adjustment would not also receive longevity in the same period — they would get one or the other under the terms presented.

A council member moved to approve implementing the competitiveness policy at 97.5% of market, establishing the longevity pay plan with the amounts and eligibility described, making the salary adjustment effective to the first pay period of January 2025, and authorizing staff to make the necessary budget transfers of $1,200,000. Another council member seconded the motion. The council approved the motion by voice vote.

The action implements changes to the city’s pay grade structure that staff said had been approved previously on June 12, 2024, and begins a phased approach to bringing salaries closer to market while explicitly tying longevity pay to budget availability in future fiscal years.