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Fraser HR proposes roughly $125,000 in non‑union pay increases; health‑plan 'hard cap' limits options for HSA funding
Summary
The city's HR director presented a non‑union wage study recommending pay adjustments costing about $125,000 and a package of benefit changes; council also discussed state 'hard cap' rules that constrain how much the city can fund employees' HSA contributions.
Jennifer, Fraser’s HR representative, told council on April 16 that she had compiled a non‑union wage packet using MML averages, a regional MGT study, and current job postings. She identified internal inequities — some non‑union department heads earn significantly less than comparable positions — and recommended wage adjustments affecting several department head positions. Jennifer said the estimated total cost of the recommended adjustments in the proposed budget is about $125,000.
Funding options and constraints: Jennifer and finance staff discussed ways to accommodate the increase, including using administration allocation adjustments, pursuing grants, or reconsidering the PA 33 millage allocation. Council members noted the city projects only a 2.7% overall revenue increase while prospective pay adjustments range from roughly 2% to more than 10% for particular positions, raising questions about affordability.
Health‑plan 'hard cap' and HSA funding: Finance staff explained state 'hard cap' rules that limit a municipality’s employer contributions tied to high‑deductible HSA plans; because the state cap has not risen in step with health‑care costs, the portion available for HSA funding has shrunk. Staff described options discussed with the insurance administrator — adjustments to stop‑loss levels and plan design — that can affect how much the city can earmark for HSA contributions without exceeding the hard cap. Any change that moves the city from self‑insurance to a fully insured plan could also require contract and union negotiations and change long‑term costs.
No action tonight: Staff emphasized there was no expectation of making final wage or benefit decisions at the workshop; Jennifer asked council to take time to review the packet and return with questions. Councilmembers asked for clearer scenarios showing how the recommended wage changes would fit within the overall revenue constraints and the proposed budget.
