The full council met before the Dec. 16 regular meeting to discuss establishing a dedicated funding source for employee Cost of Living Adjustments (COLAs). Although the meeting went overtime and will likely be continued at a second work session, comments indicate the council, mayor and department heads are concerned about the city’s ability to pay and to stay competitive with other municipalities.
City Police Chief Jim Roberson has cited COLAs as an important recruiting tool for Homewood PD officers and former Parks and Recreation director Berkeley Squires, now Director of Public Services, had also suggested finding a permanent funding source for yearly COLAs. The Mayor at his budget presentation in August put the council on notice that cost of living increases could be considered in January or at the mid-point of the budget year (March). If money was available.
This item was originally sponsored by councilman Peter Wright, on the Finance Committee, and was carried over from the Dec. 2 committee meeting.
Members present: Michael Hallman, Britt Thames, Fred Hawkins (arriving late), Patrick McClusky, Walter Jones , Jenifer Champ Wallis, Heather Reid, Richard Laws, Peter Wright, and council president Bruce Limbaugh. Also present but arriving late was Mayor Scott McBrayer.
Members absent: Vance Moody
Staff present: City clerk Linda Cook, city attorney Mike Kendrick, mayor’s chief of staff J.J.Bischoff, and city finance director Melody Salter. Also present but arriving late was Building, Engineering and Zoning employee Greg Cobb.
Audience attendance: 1
The council discussed COLAs and general staffing concerns for 40 minutes before deciding to carry over the discussion to an additional work session in January, time to be announced. Mr. Wright began by citing a conservative approach to budgeting that should postpone the discussion of increases until the end of the fiscal year to determine whether there was a surplus to pay them. However, Wright said finding a permanent funding source now would eliminate those yearly discussions.
Mr. Jones, committee chairman, cited the need to reduce “top heaviness” on employee payroll, identifying a permanent funding source for COLAs, and setting parameters for COLAs in the city’s fiscal policy. Several members mentioned various common funding sources, such as the capital expense or debt service funds, or increasing local sales or property taxes. Mr. Jones again mentioned the constraints of having a large number of employees and some with large salaries. Currently six key employees make a total of $500,000. He suggested postponing this discussion pending the results of an ongoing staff analysis.
The mayor then spoke for about 10 minutes on the subject of staffing. He mentioned that after the most recent 2.5% increase, Homewood moved up two spots in a ranking of municipal employee benefits, landing 4th after Mountain Brook, Vestavia, and Trussville. (Chief Roberson has said the city’s ranking affects recruitment of police officers.) However, the Mayor agreed with Mr. Jones, saying he preferred to defer the COLA discussion to the end of the fiscal year (Sept. 30, 2014), and that long-term options were to reduce staff or increase revenues, not reduce services or increase taxes.
The mayor warned the council about committing uncertain funds. He pointed out the expense of managing a number of city employees to cover a wide array of businesss such as industrial, retail, hospital, and universities mixed with residential. McBrayer compared Homewood to Mt Brook which has 150 employees in a concentrated residential/retail area; he said they manage their services differently from Homewood. Homewood has 486 employees that would be eligible for COLAs, if they were approved by the Council.
Mr. Kendrick said the council can change any fiscal policies it chooses, but there are limitations on workforce reductions through the Jefferson County Personnel Board’s merit system, which has jurisdiction over Homewood.
In conclusion, the Mayor said the city’s finance director Melody Salter had compiled a presentation of options for funding sources of COLAs, but he preferred not to present them at this time. Instead, he would ask Ms. Salter to email those options to the council. That said, the council agreed to carry over the discussion to another work session in January–time to be determined.
Meeting adjourned 5:45.