City Council Agenda Packet 12-29-2005 Special
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AGENDA
SPECIAL MEETING - MONTICELLO CITY COUNCIL
Monday December 29, 2005
6 p.m.
Mayor:
Clint Herbst
Council Members: Wayne Mayer, Tom Perrault, Glen Posusta and Brian Stumpf
1. Call to Order
2. Consideration of salary schedule adjustments based on comparative data and cost of
living adjustments for 2006.
3. Adjourn
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Special Council Meeting Agenda: 12/29/05
2.
Consideration of salarv schedule adiustments based on comparative data and cost of
livin!! adiustments for 2006. (RW)
REFERENCE AND BACKGROUND:
At the December 12th meeting, Council was provided with comparative data on salaries for
cities similar to Monticello that indicated our salary schedule was below the average pay for
six selected positions. The positions analyzed would generally be typical jobs in each of
these communities and is used as a reference to provide a general background for the Council.
The comparative data used was actually compiled with the assistance of Susan Hanson from
Frank Madden & Associates, the City's personnel consultant, who utilized recent salary
survey information that was generated by a consultant for the City of Big Lake.
The survey of these selected positions indicates that on an average, the top step for
Monticello's salary range is approximately 89.19% ofthe average salary compared in other
communities. At the top end of our scale, Step 7, the City's pay schedule would average
around 72.73%.
In addition to the salary survey results, the Council will be asked to consider a separate cost of
living adjustment for our pay system for the year 2006 that will help keep us comparable to
the market place. As I noted at the previous Council meeting, the average cost ofliving index
is somewhere between 3.1 % to 4.7%, depending on whether you use the Mpls-St. Paul index
or the national US index.
The Personnel Committee recently met and reviewed the survey results with staff. While
there appears to be a difference amongst Personnel Committee members as to the specific
percentage increase that the City should consider at this time, there was a general
understanding that approximately an 8% increase appears warranted to bring the Monticello
salary schedule in line with the averages from surrounding communities that were surveyed
and in addition, once the salary schedule is adjusted, an additional 3% cost ofliving
adjustment seemed appropriate. The main discussion of the Personnel Committee related to
whether the City had sufficient funding to implement the entire 8% salary schedule and 3%
cost ofliving adjustment immediately. It should be noted that implementation of the entire
adjustment of around II % would have to be covered with 4% budgeted for 2006 along with
the balance coming from general fund reserves.
While it is anticipated that Councilmembers may have concerns with this larger adjustment to
keep us in line with the market place demand, Council needs to remember that in January
2005, Councilmembers wanted a salary survey done to evaluate how we compare to
neighboring communities to justify increases in our salary structure. With this now being
done and the results showing that we are 8% below the average, the documentation has been
provided that supports this type of an increase, and ifit is the Council's intent to have
competitive wages in order to retain and/or attract new employees in the future, adjustments to
our pay scale should be implemented as soon as practical. The salary survey is based on 2005
information and if our pay structure is not adjusted to reflect these results this year, we will
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Special Council Meeting Agenda: 12/29/05
only be further apart again next year as time goes on.
B. ALTERNATIVE ACTIONS:
Decision #1 -
1. Council could approve an adjustment to the overall salary schedule with an 8%
adjustment to bring in line with the averages from the survey results. This adjustment
could take effect January 1, 2006.
2. Council could approve an adjustment equal to 8% but implement the adjustments over
a period oftime during 2006 to be determined.
As an example, if 8% was agreed upon, 4% of this amount could be implemented
immediately as ofJanuary I, 2006 with the balance of the increase effective July I,
2006.
3. Council could approve a salary adjustment based on some other criteria.
Decision # 2 -
1.
Council could approve a cost ofliving adjustment based on the Mpls-St. Paul or US
index of3.1% to 4.7%.
2. Council could establish a cost ofliving adjustment at 3%, similar to what the majority
of other cities surveyed will be using.
3. Council could establish some other cost of living percentage.
C. STAFF RECOMMENDATION:
With the Council's decision earlier this year to have a salary survey conducted to see where
we are compared to other cities and with this survey indicating approximately an 8%
deficiency compared to the average, it is recommended that the Council implement an 8%
increase in the overall salary schedule. Although 4% was used in our 2006 budget, there are
sufficient funds within our general fund to cover this increase.
In regards to the cost ofliving adjustment, Council should also support an additional increase
of3%, similar to what other communities are using, to keep our newly adjusted salary
schedule in line with the market place.
D.
SUPPORTING DATA:
Agenda item for 12/12/05
Salary Schedule
Salary Survey
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Council Agenda: 12/12/05
11.
Consideration of salarv schedule adiustments based on comparative data.(JO)
A. REFERENCE AND BACKGROUND:
City Council has requested comparative data on salaries for cities in to see if the Monticello pay scale
is competitive with the marketplace. This request resulted from issues relating to the City's ability to
hire and retain employees within the boundaries of the current pay equity structure. Indicators
showing that the entire pay scale may need to shift are as follows.
. In order to attract candidates to accept a position, the City has needed to offer starting pay at
steps significantly higher than the entry level step. Positions filled high in the pay scale for
the position included Chief Building Official, Building Inspector, City Engineer, Construction
Observer, Assistant to Community Development Director.
. The actual City Engineer pay that was accepted by the winning candidate exceeded the
amount identified in the highest step in our pay equity plan thus creating a problem for pay
equity compliance.
. The City has lost public works employees to other cities and has had trouble attracting
qualified candidates to fill the openings.
In 2004 the City Pay Equity plan was certified by the state as acceptable so the problem is not relating
to disparity of pay between positions.
Salary Survev
Susan Hanson assisted in collecting data on certain positions commonly in place in other
communities. The job descriptions for these positions are relatively consistent across communities so
they represent a fairly good indicator or relative pay between cities. The positions selected for
comparison include City Administrator, Chief Building Official, Public Works Director, Liquor Store
manager, City Clerk and Street Superintendent. Cities selected for comparison included Buffalo,
Cambridge, Forest Lake, Elk River, Otsego, Saint Michael and the proposed salary schedule for Big
Lake in 2006. In sum, it appears that the top end of the Monticello salary structure is lower than the
average. At Step 6 which can be achieved in 4.5 years the Monticello salary structure is 89% ofthe
average. At Step 7 which can be achieved after an additional 3 years, the City salary is about 93% of
the average. It is presumed that a major reason why this disparity has occurred is due to the
cumulative affect of annual cost ofliving adjustments set at levels consistently less than what other
cities have granted.
B. STAFF RECOMMENDATION:
In order to remain competitive with the market place and word toward resolving issues noted above,
the following course of action is recommended.
I. Provide a standard cost of living increase.
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Council Agenda: 12/12/05
2.
Provide and additional increase in an effort to keep pace or catch-up to the market. If Council
adjusts pay to a point equal to the average for the cities listed, it is likely that the problems
listed above would be diminished or resolved. Increasing the salary structure in an amount
less than that may not have the desired affect.
3. Readjust step program so that step 7 can be achieved sooner or remove step 7 and shift the top
pay to step 6.
The City has had a history of good compliance with pay equity standards along with providing a
competitive salary structure. It is evident however that the City pay scale has been slipping relative to
the marketplace as noted above. Ifit is the goal ofthe City Council to continue to provide the service
that citizens have come to expect then it is important to develop a pay program that keeps and attracts
capable employees. Moreover, in this time of rapid growth and potential stafftumover in the next
few years, it is very important to retain trained staff familiar with the community. Establishing a
competitive pay scale will help achieve this goal. It appears that an adjustment above the cost of
living adjustment is needed to accomplish this goal.
D. SUPPORTING DATA:
Table showing salaries by Community.
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Council Agenda: 12/12/05
indicates that their adjustments would also take effect on their renewal date of April I, 2006
and would reflect adjustments to the pay scale adopted by the Council. Because of comparable
worth reporting requirements, we have always tried to keep union and non-union wages on a
similar scale to avoid any violations of the comparable worth law, which could result in
penalties being assessed against the City if we were out of compliance. The last time we
reported our comparable worth information we met all of the requirements and were considered
in compliance.
B.
ALTERNATIVE ACTIONS:
I. Council could establish a cost of living adj ustment for the wage scales that would apply
for non-union employees that is comparable to the US cpr index increases of 4.3% to
4.7%.
2. Council could establish a cost of living adjustment for wage scales that would apply to
non-union employees that is comparable to the Mpls-St. Paul cpr index through June of
2005 of between 3.1 % and 3.2%.
3. Council could establish a cost of living adjustment for 2006 wages based on some other
factor to be determined.
4.
Council could decide not to establish any increases at this time until information on a
salary survey is received from consultant.
C. STAFF RECOMMENDATION:
Since the Council has typically adjusted the wage scales based on cost ofliving information, it
is recommended that a percentage increase be established even before the salary survey
information has been completed by our consultant. The salary survey will likely help the
Council analyze where positions need to be adjusted to reflect various market conditions if
there are any pay inequities that currently exist but a general cost of living increase would still
seem appropriate just because of general inflationary reasons. It is very likely that the Mpls-St.
Paul cpr index will show an annual increase closer to the 4% range once this information is
available in early February and it would be my recommendation that an adjustment be
considered in the 4% range.
D. SUPPORTING DATA:
Prior years salary schedule adjustments.
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