Routt County approves raises for employees who weathered recession wage cuts
October 30, 2013
Steamboat Springs — Routt County employees learned this week that effective Jan. 1, they will receive a 2 percent cost-of-living pay increase, their first since salaries were cut in spring 2009 in the midst of the Great Recession. And employees also will be caught up with the annual salary steps on which they missed out while salaries were frozen.
In an Oct. 28 memo announcing the pay raises to staff, the county commissioners collectively acknowledged that since 2009, when the county imposed 5 percent pay cuts, "the annual budgets have been balanced on the backs of employees."
Veteran Commissioner Doug Monger, who was on the board in 2009, said repairing that situation was given special emphasis this budget cycle.
"As we began preliminary discussions for the 2014 budget, the new commissioners (Steve Ivancie and Tim Corrigan) and I, with department heads and the county manger, had discussions about where our priorities were," Monger said Wednesday. "It was pretty unilateral among the three commissioners that the No. 1 priority was to bring our employees' salaries back."
County employees had their salaries restored to 2009 levels in 2013, when a 5 percent pay cut was eliminated, but they have taken a hit in the meantime. County Finance Director Dan Strnad acknowledged in November 2012, as the 2013 budget was being finalized, that a county employee whose salary was $50,000 in 2009, had lost $12,500 in pay.
Sullivan confirmed Wednesday that money is gone and isn't coming back, but the cost-of-living raise puts county employees on a better track going forward.
For an administrative assistant IV hired to work in a county office at a beginning salary in 2012, for example, the combination of the 2 percent raise and restoration of annual salary steps would result in a 9 percent increase in compensation before 2014 is over.
That employee would have started with an hourly pay rate of $18.20, or $37,856 annually. On Jan. 1, that employee would see both the 2 percent raise and the salary step he or she would have received in 2013 reflected on his or her pay stub for an hourly rate of $19.22. Then, on the anniversary of employment in 2014, he or she would see another salary step bringing the pay rate to $19.88 hourly, or an annual salary of $41,350.
For veteran employees, the pay increase will be more significant, but not always everything they are due Sullivan said. An employee hired in 2008 will see three salary steps added to his or her pay. That employee is technically eligible for six steps, but the commissioners capped this year's accrued steps at three. That doesn't mean the other three are forgotten, Sullivan said, just on hold.
The restoration of the 5 percent pay cut cost the county $636,000 this year, and the cost of restoring salary steps and the 2 percent raise in 2014 is just more than $1 million. Monger said he's optimistic the county's financial picture has improved enough to sustain the pay increases.
However, with the realities of the recession and the Routt County real estate downturn hitting hard in spring 2009, the former board of commissioners, including Diane Mitsch Bush and Nancy Stahoviak along with Monger, initially announced a 10 percent pay cut in the form of reduced hours for employees. That lasted 10 months before employees and department directors agreed to work 40 hours at a 5 percent pay cut.
"It was something we had to do," Monger said this week about the salary cuts. "Facts are facts. We balanced our budget, service levels and the need to maintain roads by putting the burden on our employees."
Monger said although the large majority of county revenue comes from property taxes, it was actually a steep decline in the county's 1 percent sales tax as well as in building-use taxes (sales tax collected on building materials), that was alarming in 2009. Because the county had prudently amassed significant mill levy credits under the Taxpayers Bill of Rights, it was able to cushion the impending blow of declining valuation of real estate in the county.
Between 2009 and 2014, the county also has reduced by 22 the number of people it employs, realizing substantial savings, Monger pointed out.
Sullivan agreed. The county lost almost $2 million in sales tax revenue in 2009 alone, he said. Had the county not cut employee compensation, it would have been forced to look at more than the relative few layoffs it enforced.
"I would say the majority of our employees wanted to see people keep their jobs, and they were willing to take pay cuts" rather than risk being the ones to lose their jobs, Sullivan said.
However, he was quick to add that the work ethic of county employees during the salary cuts was exemplary.
"Those same employees were stepping it up and providing the same level of service, so the citizens didn't have to take the brunt of it," Sullivan said. "They take pride in their work and wanted to do a good job. Finally, we're able to reward them for sticking around with us for so long. Hopefully, they'll continue to work for us for a long time and have a good wage going forward."
Monger said that prior to authorizing the pay increases, he and his fellow commissioners asked Human Services Director Chris Hensen to conduct an informal salary survey. It compared current Routt County wages to those of corresponding counties and found that prior to this year's restoration of salary cuts, they were 10 percent behind the market rates. Now, that gap is being closed, he said, and the commissioners will ask for a more formal survey to review the criteria in use prior to the 2015 budget process.
Sullivan said he will step back and let an employee committee led by Yampa Valley Regional Airport Director Dave Ruppel conduct that review.