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Dec 05

City Manager's Message 12/5/14 Beginning Budget Season

Posted on December 5, 2014 at 1:09 PM by Mary Bunting

As we near the end of the calendar year, we enter budget season. The budget season actually runs through May when Council formally adopts the budget, but we begin to assess where we are from a revenue and expenditure standpoint. Also, December is when the Governor releases the State budget.

Here is what we know so far... Our economy continues to improve, although not as fast as we would hope especially in the housing sector. This is not unlike other cities in the state but it does contribute to budgetary challenges. The State budget has been significantly underperforming as compared to its projections. To solve this problem, the State has compelled localities to contribute to the State's shortfall. Hampton is being required to write a check to the State for just under $700,000 this year and likely will have to do the same, or more, next year. This is especially frustrating.mWere it not for the State doing this, our FY 2016 budget outlook would be much better; but, the State requirement for localities to assist in balancing that budget will negatively impact all localities.

Nevertheless, the management team and I are in 100% agreement that employee salary increases are our highest priority for the FY 2016 budget. While I do not yet know how much we will be able to give, or how exactly we will achieve it, I have given one explicit instruction to the budget development team: give me a balanced budget that provides salary increases for all employees. Given the State impacts, we may have to make cuts elsewhere to achieve this absolute goal. However, if that is necessary, we will do so.

Because we have made cuts in past years, identifying additional ones will be challenging but not impossible particularly if we include more people in the cost savings identification process. I have often said that our employees are our best asset. This is true not just because of your work ethic and dedication but also because of the immense knowledge and talent you bring to the job daily. I believe that many of you may have legitimate cost savings and efficiencies ideas and I want to invite you to submit those for the budget team's consideration. 

 

To help facilitate employee ideas, we have developed a survey at the following link: https://www.surveymonkey.com/s/KGX8XQG. Savings generated will be dedicated to our highest budget goal: employee salary increases. As an incentive to participate, the the top three ideas that produce operating budget savings or efficiencies will receive cash bonuses (a minimum of $500 for first prize, $300 for second prize and $200 for third prize - actual awards may be higher as they will be based on the amount of savings achieved.) Other suggestions used in the budget process will also be recognized with achievement awards. The deadline for survey submissions is December 31st. We will announce the winners later in the Spring after we have evaluated the submissions for actual savings and fairly determine which submissions generate the most savings. 

 

Finally, before closing, I would like to give you an update on the compensation and classification study being conducted by Management Advisory Group (MAG). Thanks to everyone who participated in the Job Analysis Questionnaire (JAQ) process in September and October. Over half of you completed the JAQ either individually or as part of a group.  Since October, the following activities have occurred:

1.      MAG reviewed the JAQ information from employees and supervisors and started developing the new classification structure.
2.      Departments completed Administrative Issues Forms for MAG that identified challenges in recruiting and retaining employees. 
3.      MAG conducted on-site Administrative Issues meetings with the department heads to review the forms and discuss any other challenges related to classification and compensation.
4.      MAG submitted requests to localities for external market data in the Hampton Roads area as well as other localities with demographics similar to us with a deadline of October 31st. This information is used to further refine the new classification structure. 

Once the preliminary report is completed, along with any implementation options, we will provide information to Council and the workforce. We will then work to identify how to best accomplish as much of the study recommendations as quickly as possible. However, please note that most such studies have multi-year implementation schedules. Until we receive the reports and get further along the budget process, we cannot give more specifics. However, as I stated above, salaries increases will be proposed when the city manager’s recommended budget is submitted to City Council no later than April 15th. 

My messages of August 26 and September 23 contain the background about the project including an informational video.  These can be found online (http://hampton.gov/Blog.aspx?CID=1). 

Thank you for your continued patience as MAG and senior staff work on the study. I will keep you updated as we work through the process.

If you have any questions, suggestions or concerns, please do not hesitate to contact me, and don't forget to submit your budget ideas by December 31st. Thanks, and have a great weekend!

Mary

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