Godfrey: Save $1M to pay employees later

May 31 2011 - 9:10am

OGDEN -- Mayor Matthew Godfrey wants the city to cut a little more than $1 million over the next seven years from its budget to help fund future employee pay raises and benefits.

Godfrey outlined the plan for the rainy-day fund in a letter sent last month to city employees.

"Virtually all economic forecasts are predicting a slow recovery over the next several years," Godfrey said in the letter obtained by the Standard-Examiner. "There is no good economic time in sight from which we will be able to set aside money and get out of the feast or famine cycle we experience in terms of employee raises."

Godfrey says in the letter he wants to set aside money in the fiscal 2012 budget so the city can offer a consistent annual 4 percent increase for employee pay raises and benefit costs starting in fiscal 2013.

"While there is never a guarantee of raises, this will at least put us in a position of financial stability that we have never had before," he said in the letter. "These raises will be based on performance and we are estimating that about 3 percent (of the funds set aside) would be for raises and 1 percent for benefits."

Still, it's financially challenging to establish a rainy-day fund when the economy hasn't fully rebounded, said Mark Johnson, the city's management services director.

"The problem is we are in a down cycle," he said.

The city's general fund would still be the primary source for raises and benefits, but the rainy-day fund could be tapped in financially lean times, Godfrey said.

Godfrey's proposal calls for about $200,000 to be trimmed from city department operations and set aside in fiscal 2012 to establish the rainy-day fund, with more money to be added annually, Johnson said.

Godfrey's proposed 2012 budget does not provide pay raises for the city's 557 employees, but includes $640,782 to cover an anticipated 12.5 percent increase in insurance premiums.

The city council has not made a determination on whether to implement Godfrey's rainy-day fund proposal but is studying the issue and will consider it during the fiscal 2012 budget process, said Bill Cook, the council's executive director. The council is examining ways to set aside money specifically for performance raises and having funds that are unrestricted in their use, Cook said.

The council plans to adopt the budget June 21.

 

This topic is being discussed at The Weber County Forum.

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