Council approves pay hikes

City holds line on employee health care

Teena Ray hasn't been following Craig City Council's budget discussions, though its final decision affects her paycheck.

Ray, a city wastewater plant operator and laboratory technician, said she didn't know City Council was struggling to find money for employee raises; nor did she know it considered increasing employee health insurance contributions as a way to free up funds.

"Health insurance is a big benefit," Ray said. "Even if they had to increase it, it's nothing compared to what they do for us."

She said she trusts City Council to do the right thing. She wasn't disappointed.

On Tuesday, the City Council agreed to give all city employees a 4 percent cost-of-living wage increase without asking those employees to contribute more for health insurance.

Employees, depending on their pay scales, are also eligible for pay increases based on merit.

"Every time they give us a raise, it's always very generous," Ray said. "I feel fortunate that they think so much of their employees."

Ray has worked for the city for nearly four years.

Banking on sales tax

City officials are banking on sales tax revenues to continue to be higher than projected and that the increase will cover employee raises.

At City Council's regular meeting Tuesday, city staff reported a $77,408 general fund surplus. The 4 percent employee pay increase cost the city $150,000.

"We have to do this," Coun--cilor Tom Gilchrist said. "It's the employees who are keeping the city looking real good. I think 4 percent is great."

Ahead of projections

In the past three years, the city has ended each year an average of $264,000 ahead of projections.

If sales tax revenues don't keep pace with expectations, the city will dip into its reserve fund to pay the difference or will delay a purchase or project, City Manager Jim Ferree said.

Finance Director Bruce Nel--son said he doesn't think dipping into reserves or postponing projects would be necessary.

If the 2006 budget were revised to reflect the increase in sales tax the city has collected in the past two months, there would be an extra $70,000 in the budget, Nelson said.

Looking good

"The economy looks good, businesses are picking up, and we hope that continues," Nelson said.

The City Council had considered increasing employee health insurance contributions to 20 percent from 10 percent and increasing employee's co-pay to $20 from $10, but it backed away from the move after it learned it would cost the average employee $500 a year.

Still, city officials haven't ruled out the possibility of asking employees to shoulder more health care costs.

Increasing the co-pay and employee health insurance contributions would give the city an additional $40,000 to $60,000 a year, officials say.

Mayor Don Jones said employees could have a year to prepare for the change.

"I don't think it would be fair to give them two-month's notice," he said.

Cost-of-living increases go into effect Jan. 1. City employees received a 3 percent pay increase in 2005 and 4 percent in 2004.

Christina M. Currie can be reached at 824-7031, ext. 210, or ccurrie@craigdailypress.com.

Commenting has been disabled for this item.