By JIM BROOKS
Nelson County Gazette / WBRT Radio
Tuesday, Sept. 2, 2014, 11 p.m. — At its monthly working session Tuesday night, the Bardstown City Council discussed the best way to affordably raise employee pay to match the pay scales of cities of similar size.
While the council seemed to be in agreement that the city employee’s pay ranges lagged their counterparts at other Kentucky cities, there was no consensus about how the city should fund the higher wages.
The wages and salaries discussion began last week at a council finance committee meeting. The committee heard from city staff regarding their surveys of other municipal pay scales and how they compared to Bardstown. Pay for nearly every city employee lags the pay found in similar positions at other small cities.
The electric utility department generates revenue — revenue that could be used to immediately equalize pay in the line crew, Jeff Mills, city electrical engineer told the council. The amount needed to bring the pay up to parity amounts to an 8.6 percent higher payroll for that department over two years ago.
“This is broken bad,” Mills said of the city pay ranges. “If we don’t fix this we’re going to start losing people.”
As an example of the pay disparity, chief operating officer Mike Abell said the starting pay for the customer service representatives (CSR) at City Hall is $11.49, while the Kentucky League of Cities reference guide states the average CSR starting pay is $13.83. At cities that also have CSRs handling cable TV and electric issues, the starting pay is $16 an hour.
“They’re doing the same thing,” he said. “When you compare apples to apples, across the board, Bardstown employees are generally low paid.”
Mayor Bill Sheckles said city administrators were aware of the disparity in wages. The recession and tighter budgets left city employees without raises or cost-of-living adjustments over several years, and the city council held the line on raising taxes. “We chose not to put that burden on taxpayers,” Sheckles said.
While the utility departments generate revenue, other departments do not, and these departments must be funded from general fund revenue. The council has some options that have been presented on finding money for raising employee pay without raising taxes.
The City of Bardstown currently funds $400,000 of the $500,000 budget of the joint city-county recreation department. Canceling the interlocal agreement would allow the city to reallocate that money for salaries.
Sheckles explained that under the current funding arrangement, city residents are taxed twice for recreation — they pay city taxes and also county taxes, both of which fund the recreation program. By comparison, county residents are only taxed once for recreation because they do not pay city taxes, Sheckles explained.
Another $200,000 could be saved by ceasing the city’s funding of the E-911 Dispatch Center. When the dispatch center was first established, it depended on city and county funding for its operation. The center is now receiving 911 telephone fees, Sheckles said.
Other options the council may consider are raising the city’s occupational tax, which at 1/2 of one percent is the lowest in Kentucky, or passing an insurance premium tax. According to the state’s Department of Insurance, 356 cities and 36 counties currently tax insurance premiums. The only Nelson County city with an insurance tax is New Haven. It places an 8 percent tax on all insurance premiums.
Abell pointed out that the revenue generated by the occupational tax changes several years ago are all being used. In considering staff pay, the council will also need to find a way to fund the better wages.
“We need to pay people what they are really worth, but I don’t want to increase taxes to do it,” Councilman Roland Williams said.
Members of the Bardstown Fire Department suggested the city consider an Emergency Services Tax that would help fund the city fire and police departments.
The council members generally agreed that a consultant should be hired to evaluate the city’s pay scales and compensation to determine where it needs to be.
-30-