At a sometimes tense June 5 budget work session, Asheville City Council members failed to reach consensus on what size raise to give city employees.
In their last formal meeting on May 22, Council members had responded sympathetically to demands by police and firefighters for more than the 1 percent cost-of-living increase in the proposed budget. But personnel costs account for about two-thirds of the city’s expenditures, and each additional percentage point would add about $500,000 to the budget, according to staff estimates.
Devoting a greater share of potential sales-tax revenue to an increase and paying for some one-time capital improvements out of reserve funds, staff suggested, could free up enough money to provide a 2 percent increase, plus a $600 bonus for those making less than the median income for the the Asheville area — if sales-tax revenues turn out better than expected. Staff also presented Council with an option for a 3 percent raise, which would require delaying more projects and using more reserve funds.
Council member Marc Hunt pointed out that Asheville taxpayers already bear the costs for services and infrastructure that benefit an unusually large population of visitors. Regional and state governments, he argued, should recognize the city’s role as a “regional enterprise” and help fund it. Resolving the city’s long-term budget challenges, said Hunt, is essential to avoid becoming “a hollowed-out city, unable to provide services.”
Devoting overly optimistic revenue projections to a 3 percent raise “makes me very nervous,” said Vice Mayor Esther Manheimer. Because salaries are a recurring expense, she explained, maintaining those higher salaries would eventually require the city “to do something more drastic, like raise taxes.”
“Or more rational,” countered Council member Cecil Bothwell, who’s long advocated a property-tax increase to meet the city’s needs. At the last Council meeting, a proposal to do just that narrowly failed.
Council member Chris Pelly noted that while many city salaries are below state averages, some are higher. In the coming year, he wants the city to compare its pay rates for all positions, so it can make more targeted increases. Manheimer supported that idea.
Mayor Terry Bellamy was particularly vocal about the need for bigger staff raises, saying the city should delay as many infrastructure and capital projects as it takes to provide the funding. She called the current budget proposal’s lack of a more substantial pay increase “deplorable.”
That didn’t sit well with City Manager Gary Jackson, who replied, “We don’t have any fat in this budget.” Staff, he said, have repeatedly done the best they could in the teeth of the recession, and delays in purchasing equipment and infrastructure are already having a significant impact.
“They're at the point where our operating personnel are saying they can't do their job,” noted Jackson, adding that further cuts would have to come out of “supplies, fuel; you're cutting equipment they need to do their jobs.”
Council member Gordon Smith was absent due to a family funeral, but Manheimer reported that he favored both a 2 percent increase and, if sales-tax revenues are adequate, the bonus.
“He’s not here,” Bellamy replied.
After the meeting, Lauren Bradley, the city’s director of finance and management services, told Xpress that staff would probably draft two budget outlines, showing both the 2 percent and 3 percent options. During the meeting, Bradley noted that neither salaries nor infrastructure are at the levels they need to be.
“At the end of the day, there’s just not enough to go around,” she said.
— David Forbes can be reached at 251-1333, ext. 137, or at email@example.com.