Some Sitka city employees may be getting a big raise this year, as the city tries to bring pay for non-union employees in line with the professional market.
The Sitka Assembly heard recommendations on Thursday night (5-29-14) from a study that found that some city salaries are well below the market average. If the plan is approved, some managers will see their pay jump by over $10,000 this year.
Under the proposal, the salary for the position of Electric Utility Director would increase by nearly 20-percent, or more than $22,000, this coming year, from $117,853 to $140,441. The public works director would get a 13-percent raise, from $107,682 to $121,326, an increase of over $13,000 this year. The Harbormaster would see a 19-percent raise, from $68,619 to $81,952. And the city finance director would see an increase of about 10-percent, from $109,845 to $121,326.
Those are big numbers. But city administrator Mark Gorman says the real question is why this hasn’t happened sooner.
“I think the better question is why has it taken us so long to get to this point,” Gorman says. “The last time there was a compensation study done for the City and Borough of Sitka was 1997. We’re way behind the times on this one.”
The recommended pay raises come out of a study that the city commissioned to find out how Sitka stacks up against similar communities when it comes to pay for city workers. The study only covers non-union employees. That’s about 52 people, out of a total city workforce of about 160. Many – though not all – are managers and supervisors, including all of the city’s department heads.
The study was prompted in part by a concern that pay for non-union employees hasn’t kept pace with increases for union members, who are covered by collective bargaining agreements renegotiated with the city every few years.
Consultant Lori Messer, of the firm Fox Lawson and Associates, compared Sitka with places like Ketchikan, Kodiak, Juneau and Nome — fifteen districts in all. She found that nearly half of Sitka’s positions were, quote, “significantly misaligned” with the market.
Human resources director Mark Danielson said that affects the city’s ability to keep good people on staff.
What this is really all about is recruiting and retaining your employees,” Danielson said. “Because we have to hire people, because we have to pay what it takes to get the people we need. We have to pay what it takes to get an engineer.”
Most of the proposed raises are more modest, falling between 2.5- and 4-percent. The police chief, fire chief, and library director will get raises of about 3-percent (to $102,250, $92,742, and $72,871 respectively). So will the city engineer and government relations director (to $107,346 and $95,065, respectively)
Some of the lowest-paid non-union employees would get the largest percentage increases – an administrative assistant in the electrical department will see a 17-percent increase (to $42,515); a payroll specialist will get a 20-percent raise (to $49,233); a planner, 25-percent (to $56,784).
But the biggest raises, in dollar amounts, would go to department heads. At Thursday night’s meeting, Gorman said that’s necessary.
Your senior department heads, who are all in this room, they’re working 50, 60 hours a week consistently,” he said. “I know several of them could walk out at any moment and command higher salaries than we’re proposing here. And so on that end we’re vulnerable.”
To determine the appropriate pay for each job, consultant Lori Messer ranked the comparison communities from lowest to highest, to create a pay-range, and identified the midpoint of that range. The plan calls for all of Sitka’s non-union employees to be brought up to 90-percent of that midpoint. That means that even with the proposed raises, most employees’ pay would still be 10-percent below the market average.
Gorman says that’s a key point.
“That’s a very very conservative approach to compensation,” he says. “We’re not saying we’re a high-end payer, we’re saying we’re a middle of the road payer, and we’re not even aiming to achieve the middle of the road.”
The plan also calls for an across-the-board 2.5-percent raise this year for non-union employees, to match increases for union members.
The total cost of the adjustments plus that raise comes to $304,696 this year. The city already included the changes in the 2015 budget, so the assembly will not have to find extra money to pay for it.
The ordinance would also make significant changes to the way that employees get raises in the future. Under the proposal, after an employee reaches a certain point, salary increases would be based on performance, not longevity.
And the proposal would grant city employees an automatic 1.5-percent cost-of-living adjustment each year – less than the 2.5-percent that is typical now.
Human resources director Danielson told the assembly that the goal is a system where employees’ base salaries rise less quickly.
“The whole purpose of this is to make a sustainable plan for our community that we can actually do, that isn’t going to cost us too much,” he said.
The proposal would also place the city administrator and city attorney on contract, so the assembly would decide their pay directly. That decision will come before the assembly in a future meeting.
The assembly passed the ordinance unanimously on first reading during Thursday’s special meeting. It will come before the assembly again on June 10, at the next regular meeting. If passed, the changes will take effect on July 1.