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Budget shows $30 million increase in salaries and benefits; staff and council debate causes and transparency
Summary
Staff told council that salary and benefit increases account for the largest single general‑fund expenditure increase in the proposed FY26 operating budget. Council members asked for a five‑year breakdown that separates salary increases from benefit cost changes and described pay‑band caps, bargaining steps and retention pressures.
City staff told the council that the single largest expenditure increase in the recommended fiscal 2026 budget is salary and benefits, roughly $30 million. Council members pressed for a multi‑year breakdown and an explanation of the drivers behind the increase, including negotiated bargaining unit raises, cost‑of‑living adjustments and health/retirement benefit cost changes.
John Bennett, the mayor’s chief of staff, walked the council through the staffing context: the city’s personnel per capita and millage are lower than peer cities, and the administration described a seven‑year CPI‑scale increase (about 30.6% from 2019 to mid‑2025) that staff said contributes to pay pressures. Bennett noted the city increased its minimum city wage in prior years and that those entry wage changes ripple through compensation bands.
Bennett described the city’s pay‑band system: every job classification has a minimum, midpoint and a cap; increases above the midpoint are reviewed case by case and require additional approval and documentation. Council members asked for a five‑year, line‑by‑line chart that separates (a) negotiated bargaining increases, (b) merit/step increases, (c) other salary adjustments (hiring/retention), and (d) benefit cost changes (insurance/pensions). Staff agreed to prepare that breakdown for the next budget hearing.
Several council members said they support competitive wages for recruitment and retention, especially for sworn public safety staff, but also requested more transparency and regular reporting on personnel increases and the fiscal effect of new hires, promotions and comparable market adjustments. No changes to the proposed personnel budget were made in the workshop; staff will return with the requested historical charts and the personnel cost detail in advance of the public hearings.
