Council argument about pay raises begins

As Austin’s unemployment rate goes down, the city’s employee turnover rate goes up, Acting Assistant City Manager Mark Washington told City Council at Monday’s budget work session. Currently, Austin’s unemployment rate is about 3.3 percent, and the projected turnover rate for the coming year is 8.5 percent, Washington said.

Because the city is competing with private companies, not just other cities, it is important to keep pace with the market, he said. In addition, 28 percent of city employees will be eligible to retire within the next five years, and only 47 percent of city employees who responded to a survey said they were satisfied with their salaries. That compares with 84 percent who said they were satisfied with their benefits.

That was part of staff’s presentation in support of management’s proposed 3 percent pay raise for all civilian city employees.

The presentation did not set well with Council Member Ellen Troxclair, who helped author an alternative plan that would give a 3 percent raise only to the lowest paid employees. Troxclair, along with Council Member Don Zimmerman, proposed 3 percent raises only for employees earning less than $15 per hour, with the pay raise dropping to .8 percent for employees making $50 per hour or more. Council Members Ora Houston and Sheri Gallo are also co-sponsors.

Washington, who served as director of the Human Resources Department until a few months ago, reported that published compensation data supports the 3 percent proposal. He cited four different publications as well as a survey of other Texas cities in supporting the 3 percent proposal.

Washington showed an example of a possible unintended consequence of arbitrary breaks for establishing pay raises based on current salary: Employee A, who makes $14.97 per hour, would get a 3 percent raise, bringing his or her salary to $15.41 an hour; Employee B makes $15.03 per hour and would get a 2.5 percent raise under the proposal from Troxclair, bringing his or her salary to $15.40 per hour.

The Zimmerman/Troxclair proposal could result in lower paid employees making more than their supervisors or making more than employees who have been there longer, Washington said.

Troxclair said she was frustrated by the presentation. “Ten pages of this was dedicated to a resolution that is before the Council, with no argument as to what the alternative could be,” she said. “I think that you’ve heard consistently from the Council that — or maybe not from all Council members, but at least some of the Council members, that we’re really concerned about the cost of living and the tax rate, and the 3 percent across-the-board pay increase is one of the biggest cost drivers that we’re facing in this budget cycle.

“So I think it is perfectly rational,” she said, to ask for an alternative that might save $6 million. Troxclair concluded by saying she is not necessarily “married to” her previous proposal.

Council Members Pio Renteria, Delia Garza and Leslie Pool each took a strong stand against the Troxclair/Zimmerman proposal.

Among the public sector benchmarks provided by Washington were proposals for 2016 from the city of Dallas, Travis County, Williamson County, San Antonio and the Austin Independent School District, among others.

Renteria, who is retired from IBM, said he would certainly not want the city to emulate the school district, which is unable to pay its employees what they deserve because the state takes away its funding. “It’s sickening what we’re doing to our employees at the school district,” he said.

Renteria went on to thank Washington for the program that provided his office with an intern, sending a clear message that he will not be supporting cuts to employee raises.

Pool said she thought it would be important for staff to compare Austin’s cost of living to other cities in the state when discussing salary, noting that it seems to be more expensive to live in Austin than most cities. She also stressed that the city should pay for any increases in the cost of health insurance so that raises would not be eaten up by rising insurance premiums.

While some members of Council said they were interested in the possibility of pay-for-performance, Pool rejected that notion based on her experience with the state of Texas.

Council Member Sheri Gallo pointed out that a lot of people choose to live in Austin because they enjoy the lifestyle, perhaps despite the fact that they make less money here than they might in New York or Los Angeles, for example.

Garza said many of her District 2 constituents were born in Austin and they continue to live where they grew up. She said she would not be supporting any move to diminish the 3 percent across-the-board pay raise.

After the meeting, the Austin Monitor spoke with AFSCME representative Jack Kirfman, who said the union strongly supports management’s budget proposal.

“We’re in a good time here economically,” he said. “It’s probably one of the best places to live on the planet right now (because of its economy). That’s when you take care of the people who provide the services. And when times are tough, those same people keep delivering the services because they know that when times are good, they will be taken care of.”

“There’s nothing wrong with the proposed budget,” Kirfman continued. “Pass it. I have to say the city manager has proposed a good budget.”

Council will return on Wednesday to discuss employee benefits and try to get through presentations from a number of other departments.