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June 8, 1971
<br />
<br /> While the proposed budget reflects an increase
<br />$1,634,357 is mn £ixed costs, such as debt service,
<br />This leaves $277,690, or 14% of the increase, to he
<br />
<br />of $1,844,507 over the current year,
<br />retirement, and funds allocated to school
<br />allocated to the operating departments~
<br />
<br /> The primary mission of City Government is service to its citizens, so it would naturally
<br />follow that the largest expenditure is for personal services, or salaries and wages for
<br />employees. This amounts to $8,465,098, or 52%. The balante of the operating funds are as
<br />follows:
<br />
<br />Contractual-Services $ 676,228 .04 %
<br />Fixed & Sundry Charges $2,398,563 .15 %
<br />Material ~ Supplies $ 9S0,486 .06 %
<br />Debt Service $2,562,596 .16 %
<br />Welfare $ 993,766 .06 %
<br />Equipment $ 47,062 .002%
<br />
<br /> Under personal services, no provisions have been made for additional employees over the
<br />current budget level. In fact, ther ms a reduction due to retirements and attrition. Our
<br />employment_ level on a per thousand population basis compares favorably with the surrounding
<br />communities and is sub'stantially lower' than the national average. The employment level in
<br />this b~dg~t averages 11.38 employees per thousand population, against a national average of
<br />19. From the best information agailable, Norfolk's ratio is 12.53, Chesapeake -- 12.69, and
<br />Virginia.8~ach -- 8.26.
<br />
<br />One of the most important elements of City Government is employee morale and this is governed
<br />largely by the ability of the City to pay a living wage and compete in the market place.
<br />Due to the City's current revenue picture, it is not feasible to recommend an across-the-
<br />board percentage pay increase. We have, however, developed a uniform pay plan to include all
<br />hourly, salaried, and fire and police personnel. This'has been one of the most important ob-
<br />jectives of the administration for fiscal year 1971-72.
<br />
<br /> Unlike possible inequities in previous years, the uniform step plan will establish an
<br />equal percentage increase for all eligible employees in the future, upon-authorization by
<br />the City Council.
<br />
<br /> Because of current r'evenue problems, it is not feasible to recommend implementation of
<br />this plan on July 1, 1971, the start or'our new fiscal year. In order to equitably merge the
<br />three existing pay plans into a uniform Flan, without reducing any salaries, and giving equal
<br />compensation through conversion, a 5% increas~ over the current Fayroll would be required if
<br />established on a full fiscal year' basis.
<br />
<br /> Therefore, I am recommending that the new pay plan not become effective until October 1,
<br />1971. This would provide over the 12-month fiscal period an average increase of 5%, the samel
<br />percentage increase as that recommended by the Schcol Board for school personnel.
<br />
<br /> All automatic pay increases previously authorized for July 1, 1971, would be included
<br />im the conversion to the new plan on 0cto'ber 1, 1971.
<br />
<br /> In addition to the new unform pay scale, it is also recomm'ended~improvements be made in
<br />the sick leave benefits to allow additional sick leave days. At the pre~ent time, employees
<br />are granted six days per year or 1/2 day per month accumulative to 120 days. It is recom~
<br />mended that employees be granted one day for each month worked and be allowed unlimited ac-
<br />cumulation. This is in line with the surroundinggcommunities.
<br />
<br /> There are only 6 departmental categories that reflect any substantial increases over
<br />the current budget. The highlights of these are as follows:
<br />
<br /> The Retirement Board increase of $203,830 is based on an actuarial evaluation of the
<br />system. These additional funds are required to maintain an actuarially sound basis. Pro-
<br />visions assuring retired employees:an annual-adjustment in pensions, plus additional personnel
<br />over the previous two years has created this increase. Also, the rate mncrease in Social
<br />SBcurity as of January 1, 1971, has reflected a cost increase to the City.
<br />
<br /> The Health Department %udget reflects an increase of~$92,764. This appears, to be a
<br />substantial increase but there are additional compensatory revenues. While Medicare and
<br />Medicaid are largely responsible for this increase, there is reflected, however, under the
<br />category of hospitalization for indigents, a reduction of $126,400.
<br />
<br /> The $157,655 increase in the Police Department budget is created largely by two federal-
<br />ly-funded programs -- the traffic investigation squad and the mobile crime laboratory.
<br />Included in the revenue are funds from the Federal Government, offsett'ing this 'cost. Funds
<br />also are included in this department's budget to cover automatic-step increases.
<br />
<br /> there is a new budget category for the landfill operation established at Craney Island.
<br />The cost i~ estimated to be $87,265 f~ the next fiscal year. This expense has been necessi-
<br />tated by r~st~ictions under the, anti-pollution laws, and regulations of the State Health
<br />Department against pollution. The disposal of bulky materials has been ~problem for some
<br />time and we are most fortunate to obtain this land~r a landfill opDration.
<br />
<br /> Our debt service cost is increasing by $400,167 through two bond issues -- one in
<br />September, 1970, and the other in April, 1971. $5 million in bonds were issued for the Manor
<br />High School~and the balance of the bonds were issued for capital pro~ects now under construc-
<br />tion or authorized. The increase in debt service would have been $225,000 higher except'our
<br />final loss-of-revenue payment to the City of Chesapeake under the annex~$ion decree is reduce,
<br />by the above amount.
<br />
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