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May 16

Manager's message: FY 2015 budget adopted

Posted on May 16, 2014 at 3:40 PM by Mary Bunting

All,

Yesterday City Council approved the FY 2015 City budget. There were only minor corrections – none of which changed the details of what I shared with you in my last communication on the budget. In summary, here is what the budget does for employees:

  • city managerMost jobs are protected – only a handful of jobs were eliminated and we believe we will be able to successfully place the few employees who are directly impacted (they all know who they are and have already begun working with Human Resources on ideal placements)
  • Employees will be eligible for up to $1000 of one-time, or bonus, payments, based on merit ratings. These funds will be spread across the fiscal year with the first payment in July and the second in December.
  • The bulk of the health insurance premium increase is being picked up by the City. The increase is relatively minor with employee impacts ranging from $1.59 to $6.43 per pay period, depending on type of coverage chosen by the employee. The one-time payments being made by the City (as described above) will more than offset this increased cost to the employee.
  • The bonus personal days (one per quarter) have been retained and will continue, uninterrupted, in the same manner as in the past two years.


As I previously stated, my clear preference would have been to provide a real salary increase to employees – that is, a raise that increases the overall salary, based on employee merit. In the current fiscal year, we did provide a real salary increase (of 1% plus up to $1,000 additional base salary adjustment) and it had been my hope that we could build on that increase with another; but the combination of declining revenue and cost pressures made my goal unattainable for FY 2015.

I would also like to reiterate what I shared earlier about other localities. I realize that several other regional localities are proposing raises this year. Please note that many of these localities are still converting the VRS requirement to their workforce. When the General Assembly mandated the requirement that employees pick up the 5% VRS employee share, they gave localities the option of doing this conversion – with an offsetting 5% raise – in one year or over five. Here in Hampton, we did the full conversation at one time, believing that was ultimately better for our employees. The earlier conversion allowed employees to have a higher base salary for VRS purposes sooner. Moreover, we did not just offset the 5% employee share with the mandated 5% salary increase – instead, we increased base pay by 6%, slightly more than the 5.75% that was truly needed to make employees whole. Most other localities throughout the region and state have committed only to the 5% for 5% requirement, and even then many are still doing the conversion. Similarly, in earlier years of the recession, other localities had furlough days or pay cuts when Hampton never imposed such cuts. I explain all of this so you understand what you observe in other localities is perhaps more complex than would be immediately apparent. Also, I want you to understand the extra efforts the Council and I have gone to, when our revenues allowed us to do so, to support our employees.

As I told you in my last communication on the budget, my Manager’s Message noted that a compensation study is under way which will assess our employees’ wages compared to both the public and private sector. I plan to push, and hopefully the community will too, for the appropriate pay increases supported by the study results next fiscal year. In the meantime, it is my hope that the bonus payment coupled with the raises we did provide this year and last, as well as the bonus personal days begun in FY 2013, will convey our serious commitment to the workforce.

We will also continue to do other types of non-monetary incentives throughout the year as we have done in years past. For instance, each year we are able to provide free tickets to employees for the Opening Night of the Peninsula Pilots game. This year’s game will be on Wednesday, May 28th. Showtime is at 6:05 pm and the first pitch will be at 7:05 pm. If you would like tickets for you and your family, please contact Donna Hodges in my office. This is just one of the many small ways we try to “surprise” and “thank you” throughout the year. Hopefully, many of you will be able to join us. I hope we will be able to do things like this a little more often in the next fiscal year.

In closing, I also want to reiterate my cautious optimism that this will be the last of the bad years. Hampton’s economy and housing market is improving and may be better next year. New housing construction is up, and high value houses are being built. New retail and restaurants are popping up in many locations; and, businesses are announcing expansions and new locations. Hampton is home to small start-up companies like Mango Mango Preserves, featured this year on Shark Tank, and rapidly expanding international businesses like Measurement Specialties, featured in Fortune and Forbes magazines. As more and more businesses like these choose Hampton as their home, our tax base will grow, making future budgets less challenging.

I hope everyone has a great weekend!

 


Mary

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