Our View: City right to wait on bonuses
March 21, 2010
The majority of Steamboat Springs City Council members were wise last week to postpone a decision on paying out $250,000 in performance bonuses to city employees.
Until there's evidence that the local economy has made a lasting turnaround, it would be premature to allocate unspent 2009 funds on bonuses for employees whose hours were cut along with their pay.
Make no mistake — we're appreciative of the work and sacrifice made by city employees who were subjected to a furlough program last year that reduced their pay and hours by 10 percent. The city handled the furlough program well, meeting with employees in advance and working with them on a structure that ultimately resulted in most city departments adopting 36-hour work weeks.
While closing City Hall and other departments on Fridays may have caused an inconvenience to some residents seeking services on those days, the effect was to give city employees three-day weekends, which for some allowed more flexibility in seeking other, part-time work, and others the chance to save a day's worth of child care expenses each week. The city made the most out of a difficult situation for its budget and staff.
It's similarly important to acknowledge the prudence and responsibility demonstrated by the council when adopting and revising its 2009 budget. When initially handed a budget in which former Finance Director Lisa Rolan projected only a 4 percent decrease in sales tax revenues, the council, led by current President Cari Hermacinski, expressed serious reservations about those projections and revisited the budget a couple of months into 2009. At that time, the budget was revised to project an 18 percent drop in sales tax revenues, and additional cuts were made. The revised projection proved to be spot-on, if not a tad conservative. And we think conservative is a good thing, particularly during a recession. When the books closed on 2009, the city had $750,000 in surplus revenue.
While it represents only a fraction of the city's 2010 budget of $40 million, we don't see why that $750,000 is burning a hole in the pocket of some council members and city officials.
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On Tuesday, the council voted unanimously to spend $250,000 on efforts to improve Howelsen Hill — no specifics were given, though officials said they're hoping to leverage those funds and the success of our Olympians into major grants and fundraising opportunities — and another $250,000 on projects in various city departments, including sealing cracks in city roads and training for police and firefighters.
In a split decision, the council voted, 4-3, to postpone giving $250,000 in performance bonuses to city employees. Instead, that decision will be made in August, when officials will have a better understanding of the 2010 financial picture, particularly city sales tax revenues.
Hermacinski, Walter Magill, Meg Bentley and Kenny Reisman voted against awarding the bonuses at this time. They deserve kudos for taking the right stand, even though it surely wasn't popular among city employees.
Hermacinski told her fellow council members, "The debate is not whether staff deserves it. The debate ought to be, should we even be spending it?"
That's the conservative approach that got us to where we are today — with a small surplus in spite of a battered economy. And that's the approach we think officials should maintain as they continue to guide the city through the recession.