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Council debates 4% COLA, compensation study timing and levy implications

New Prague City Council · August 26, 2025
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Summary

Councilors discussed whether to retain a 4% cost‑of‑living adjustment in the preliminary budget or wait for the compensation study; staff estimated a 1% COLA roughly equals $20,000 on the levy, and members weighed flat dollar approaches, steps and timing to avoid hamstringing budget flexibility.

Councilors devoted substantial time to wage policy and how to budget for a potential cost‑of‑living adjustment (COLA) while a compensation study is pending.

Staff recommended leaving a preliminary COLA in place to preserve flexibility, noting that preliminary filings commonly exceed the final adopted levy. The staff estimate presented at the meeting put a 1% COLA at about $20,000 on the levy, a figure councilors used to assess tradeoffs. Several members said a 4% COLA felt high before the compensation study, and they discussed alternatives including a flat dollar COLA, lowering step increases, or timing implementation with the compensation study to avoid compounding larger increases on higher salaries.

Councilors also debated the public‑relations tradeoff of publishing a higher preliminary levy versus leaving themselves little room to respond if the compensation study recommends larger changes. Several members asked staff to illustrate long‑term impacts (a 15‑year graph of actual dollars) and to return with compensation‑study timing options and modeled levy effects so the council can weigh flexibility against potential public reaction.

Staff agreed to continue modeling scenarios for the council and to incorporate compensation‑study outcomes when available; the council generally supported keeping an allowance in the preliminary budget but asked for clearer, data‑driven options when the study is complete.