Record $5B budget includes pay increase for city workers – and for Council members

City Council’s $5 billion budget for Fiscal Year 2022-’23 includes a pay raise for city workers, including Council members themselves. Council voted to adopt the budget, which includes increasing the minimum wage for city workers to $20 per hour, in a 10-1 vote late Thursday, with only Council Member Mackenzie Kelly voting “no.”

Originally, the minimum wage was set to rise to $18 per hour, per City Manager Spencer Cronk’s proposed budget. But following a push by labor activists and Council Member Vanessa Fuentes, that number rose, first to $22 per hour before settling on $20 per hour.

The pay raise is funded by an unexpected increase in sales tax revenue, leaving the city with an extra $20 million as it hashes out the budget. The raise will cost an estimated $7 million per year.

Around 4,100 workers, roughly a quarter of the city’s workforce, will benefit. Those currently making right around $20 per hour will also see their pay increase out of fairness. Council members’ staffers will get raises as well. 

In the coming years, the minimum wage for city employees could rise further, up to $27 per hour, if the city follows through on a resolution from June of this year.

The pay raise comes as the city has experienced a dramatic increase in the cost of living since the beginning of the pandemic. According to the resolution, “Average rents in Austin have increased 35%, appraised values for (homes have) increased 56%, and inflation has hit 8%, all contributing to the Consumer Price Index (CPI) increasing at a rate unprecedented over the last 40 years.”

Council members also expressed support for requiring a living wage from social service providers that enter into city contracts. 

The city only has purview over the minimum wages of its own employees and the employees of third-party service providers, contractors or consultants. Texas state law forbids cities from setting minimum wages for all workers within the city limits. The current state minimum wage is $7.25. 

Meanwhile, Council also voted to give itself a 40 percent pay raise, though not all members were on board: Council members Kelly, Vanessa Fuentes and Paige Ellis objected.

With the raise, Council members’ salaries will rise 40 percent, from the current $83,000 a year to nearly $117,000. The mayor’s salary will increase 37 percent from just under $98,000 to $134,000. 

By comparison, Travis County commissioners make $140,000 per year; County Judge Andy Brown makes $160,000. The per capita income in the Austin metro area is around $65,000, according to FRED. 

Earlier Thursday, Ellis released a press release saying she was opposed to the salary increase: “I will vote no … as our priorities need to stay focused on working people right now,” she said. Ellis is running for reelection in November and faces conservative challenger Richard Smith. 

Conservative PAC Save Austin Now lambasted Council members in a press release. “Only the Austin City Council could be so stunningly tone deaf that they would propose a massive and unearned pay increase,” the release said.

The city’s Human Resources Department, based on data from peer cities, supported raising Council members’ wages.

Working from the city manager’s proposed budget, Council members approved $73 million for building and repairing city sidewalks; $27 million for cultural arts, historic preservation and live music, funded by Hotel Occupancy Taxes; $79 million for homelessness prevention, including $4.8 million to clean up homeless encampments; 55 new jobs at AUS airport; $1 million for trauma recovery center; and $3.6 million for wildfire prevention.

Council members also added a raft of amendments, among them $17.8 million to complete construction of the Goodnight Ranch Fire/EMS station in Southeast Austin; funding for nine additional full-time lifeguard positions; and $350,000 for reproductive health and wellness services and education in the wake of the Supreme Court’s repeal of Roe v Wade.

In a statement late Thursday, City Manager Spencer Cronk said, “The budget adopted by Council today puts the city in a strong position to recruit and retain the people we need to sustain the high quality of services our residents have come to expect. It does this while reducing the city’s portion of the annual property tax bill for the typical homeowner and investing in public safety, disaster response, and actions to address climate change. We look forward to implementing Council’s priorities in the coming fiscal year.”

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