Budget committee debates personnel increases
Group brings back funding for some community organizations in budget proposal that will go before the City Council
One of the most significant points of Newbergs proposed 2016-2017 budget, the hiring of five new positions, drew substantial discussion during the final budget committee meeting May 10. The committee is made up of the City Council and seven citizens.
Councilor Patrick Johnson voiced concern with how the five positions would be funded they are budgeted to be paid for through reserve funds, which came in relatively high this year.
Committee members also voiced concern over a scenario in which the city does not have the reserves to pay for the positions in the future. Paying employees is a continuing cost, several committee members noted, and hiring without a solid, sustainable funding source for those positions is a bit risky.
The question gets to be how is it sustainable? Is this now a sustainable budget? Councilor Scott Essin said.
Do we need these things? Absolutely, Johnson added. But he also cautioned that it sends the wrong message – even though the funds are separate from each other – to raise utility rates across the board and then turn around and hire five new positions in one year. He brought up the idea of a phased-in approach, in which a few positions come in over multiple years.
Councilor Stephen McKinney countered that the work will still have to be done, whether the city hires new employees this year or not. If nobodys hired, he said, the burden will fall onto the current employees, who will be forced to take on more work.
We do it at the expense of the personnel that are already doing more than their fair share, he said. That bothers me.
City Manager Pro Tem Steve Rhodes reminded the committee that the new employment positions were included because they corresponded with goals initiated by the City Council last fall.
These didnt just come out of the air, these are responding to the council priorities that the council set for staff and told us to achieve, Rhodes said. They arent just, gee, wed like to have these, its gee, we have some priorities that were set for us and we're trying to accomplish them.
Committee member Jack Reardon voiced concern with the skyrocketing price of insurance for city employees.
Im not sure we know how quickly thats getting away from us, he said, noting that the budgeting for Health/Life/LTD (insurance) costs has jumped 30 percent since last years budget cycle (although that includes the five new positions). Overall, the city spends about $1.6 million each year on the insurance services, compared to about $1 million on PERS.
We talk about PERS, but we dont talk about this number, Reardon said.
Meanwhile, in 2017-2018, when the PERS rate increases go into effect, the city is anticipating a PERS cost increase of about $200,000, Finance Director Matt Zook said.
To help offset the PERS increases for the first few years as they jump substantially, a new reserve fund has been created and is proposed to be funded with $179,255 through the 2016-2017 budget.
The increases would have been much higher, Zook added, except that the citys firefighters will be employed by Tualatin Valley Fire & Rescue when the increases hit, meaning there will be 25 fewer positions with retirement costs.
During its final meeting the budget committee also reversed last years removal of community support funds. This year three organizations -- Your Community Mediators, Homeward Bound and Yamhill County Transit area -- requested money. The transit services were proposed to receive funding through the budget, but the others were not included until an amendment was approved last week.
Your Community Mediators had requested $22,115 in funding from the city. In 2014 the city funded the group with $5,500 from the budget. Last year, as with the rest of the community support funds, the mediation services were not funded and that money was instead routed back into city operations.
Asked why the $5,500 figure from 2014 has since increased fourfold, a YCM representative told the budget committee it was based on the amount of service the organization provides in Newberg.
Reardon suggested the committee consider a lower amount of $7,500 in funding for YCM, and that was unanimously approved.
The committee also narrowly voted 7-5 to include $2,000 in funding to Homeward Bound, which provides spay and neuter services for pets in the area.
Those payments will come out of city contingencies, Rhodes noted.
The budget committee ultimately voted 9-3 to approve the budget, which will now go before the council.
Committee Chair Lon Wall thanked the committee for its work and for the particularly lively discussion during this years budget consideration.