City Employees to Get Bonuses in Exchange for Salary Freeze

In exchange for pay-freezes in the extension of last year’s collective bargaining agreements, the city agreed to pay out one-time bonuses to city employees if the city’s finances were “more favorable than expected.”

Mayor Michael Summers announced that the city will present a (one-time) bonus payment of 1.5 percent of the base rate for all full-time, city employees in October.

The exceptions being the mayor, council, court, and school guards which received a pay increase in August.

The total cost to the general fund for the payment is $340,000, with an additional $60,000 coming from other funds.

“We are grateful that all of our union leaders and members worked with us in this most challenging year by agreeing to these one-year extension agreements,” Summers wrote to council members.

During the collective bargaining which started last year, Summers said there were some concerns about the city’s uncertain financial future — including income tax collections, slashed state funding and the elimination of the estate tax.

He added that the city’s estate tax collections are currently at approximately $600,000 — an amount that will ultimately dwindle to zero.

“I believe our best use of these funds is to invest in our employees,” Summers said. “It is important to keep in mind that our 2013 revenues remain significantly below the 2012 levels.”

“Additional good news is the at our income collections are significantly higher than forecasted, costs are in line with reduced revenues, and the new state budget was neutral in its revenue effects.”