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Board debates employee raises, weighing 9% pay-study recommendation against benefit costs and tax options
Summary
At an April 9 budget workshop, city staff presented a compensation study recommending an average 9% pay-scale increase; board members, department heads and staff debated affordability, benefit preservation and staged alternatives while staff was directed to return cost scenarios for 6% in July and 3% in January.
City staff told the Board of Mayor and Aldermen on April 9 that a consultant recommended roughly $3 million in total compensation changes citywide — about $2.7 million to the general fund — and urged the board to decide whether to fund those changes now or stage them.
"That recommendation was roughly a 9% increase to the pay scale," Andrew said during the workshop, describing the consultant's proposal and the additional adjustments recommended for about 25–30 positions below market. Bruce Richardson told the board staff presented an operating baseline with no raises so members could choose how to proceed.
The board debated whether the general fund can absorb the full increase without a tax change. "If we're not raising taxes and if this is accurate, then 2.3 (million) — we're already 400 over," Kyle said, referencing staff's current revenue estimate and warning that a full 9% implementation would exceed the forecasted capacity.
Several department heads pressed for at least a partial increase, arguing retention and recruitment costs make raises cost-effective. "Retainment has got to be the top of our list," one department head said, noting training, outfitting and academy costs can total thousands per hire. Chiefs from public safety described recent resignations to neighboring jurisdictions that offer higher starting pay.
Staff and board members also emphasized total compensation, not just base pay: Danielle noted the city's family benefit package costs about $32,524 per employee annually. Several aldermen said employees value benefits highly and offered views that a smaller raise with preserved benefits could be preferable to a larger raise paired with benefit reductions.
Board members discussed staged options — for example, a 6% raise in July and a 3% increase the following January, or a 3% across-the-board raise now with a possible midyear amendment if sales tax receipts exceed projections. Danielle confirmed any midyear increase would require a formal budget amendment and board approval.
Before adjourning, the board asked staff to return detailed budget scenarios showing the fiscal impact of: a 6% July raise with pay-scale adjustments and a 3% July plus 3% January alternative. The board did not take a formal vote at the workshop; staff will provide the numbers for a later decision.
The workshop included repeated questions about benefit comparisons with neighboring jurisdictions; several members asked staff to obtain Smyrna's employee cost-sharing details to make an apples-to-apples comparison.
Next steps: staff will prepare and present the requested compensation scenarios and comparative benefit-cost information at a future workshop or meeting.
