HomeMy WebLinkAbout2008/04/15 Item 9
CITY COUNCIL
AGENDA STATEMENT
~f:. CITY OF
(HULA VISTA
APRIL 15, 2008, Item Cj
SUBMITTED BY:
Resolution of the City Council of the City of Chula
Vista authorizing the elimination of the scheduled
fiscal year 2008-2009 cost of living salary increases
for management and unclassified hourly employees
and authorizing the City Manager to reinstate all or
part of the pay raises dependent upon the
availability of fundin~
City Manager ~ \
ITEM TITLE:
4/5THS VOTE: YES 0 NO Ii]
SUMMARY
Executive, Senior, and Middle managers are scheduled to receive a 4% salary
increase in January 2009. Unclassified hourly employees are scheduled to
receive a 4% salary increase in July 2008, which was delayed from January 2008,
and a 4% salary increase in January 2009. Due to the financial constraints the
City is experiencing it is recommended that these scheduled salary adjustments
for all management and unclassified hourly employees be eliminated.
RECOMMENDA nON
That the City Council adopt the resolution.
BOARDS/COMMISSION RECOMMENDATION
Not Applicable
DISCUSSION
The City is experiencing serious financial issues as a result of the downturn in the
economy. Through the implementation of the budget reduction plan, $15.5 million
of expenditure reductions were made to the fiscal year 2008-2009 budget.
Despite these significant reductions, staff is currently projecting a General Fund
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APRIL 15, 2008, Item q
Page 2 of 2
budgetary gap of $8.8 million for fiscal year 2008-2009. As part of the solution to
help close the budgetary gap, it is recommended that the salary increases
scheduled for all management and unclassified hourly employees be eliminated.
The budget reduction plan approved by Council in December 2007 included the
elimination of the management salary increase scheduled for January 2008. The
salary deferral agreement that was reached with the Chula Vista Employees
Association delayed the January 2008 salary increase for unclassified hourly
employees to July 2008. The elimination of all of the scheduled salary increases
for both management and unclassified hourly employees will result in two
consecutive years where these employees do not receive a cost of living salary
adjustment.
As part of the budget-balancing plan before Council, staff is recommending the
implementation of an early retirement program and the extension of the hiring
freeze. The savings from these two proposals are anticipated to save
approximately $1.6 million in fiscal year 2008-2009. However, the actual savings
from the early retirement program will not be known until the close of the program
window. Staff is recommending that all or part of the salary increases be
reinstated if the savings realized through the early retirement incentive program
and hiring freeze are larger than anticipated or if revenues exceed projections.
The resolution before Council applies only to management employees and
unclassified hourly employees - the salary increases scheduled for July 2008 and
January 2009 for the Chula Vista Employees Association, International
Association of Fire Fighters, Chula Vista Police Officers Association, Western
Council of Engineers, and the Confidential employee group will not be impacted by
this action.
DECISION MAKER CONFLICT
Staff has reviewed the decision contemplated by this action and has determined
that it is not site specific and consequently the 500 foot rule found in California
Code of Regulations section 18704.2(a)(1) is not applicable to this decision.
FISCAL IMPACT
The estimated savings from the elimination of the management salary increase are
$406,000 and $99,000 from the elimination of the unclassified hourly employee
salary increases scheduled for fiscal year 2008-2009.
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RESOLUTION NO. 2008-
RESOLUTION OF THE CITY COUNCIL OF THE CITY OF
CHULA VISTA AUTHORIZING THE ELIMINATION OF THE
SCHEDULED FISCAL YEAR 2008-2009 COST OF LIVING
SALARY INCREASES FOR MANAGEMENT AND
UNCLASSIFIED HOURLY EMPLOYEES AND
AUTHORIZING THE CITY MANAGER TO REINSTATE ALL
OR PART OF THE PAY RAISES DEPENDENT UPON THE
AVAILABILITY OF FUNDING
WHEREAS, Executive, Senior, and Middle managers are scheduled to receive a
4 percent salary increase in January 2009; and
WHEREAS, unclassified hourly employees are scheduled to receive a 4% salary increase
in July 2008 and a 4 percent salary increase in January 2009; and
WHEREAS, the City is experiencing serious financial Issues and staff is currently
projecting a general fund budgetary gap of $8.8 million; and
WHEREAS, the elimination of the scheduled fiscal year salary increases for all managers
and unclassified hourly employees will help close the budgetary gap by saving approximately
$505,000; and
WHEREAS, the City is offering an early retirement incentive program and extending the
hiring freeze, which are anticipated to generate approximately $1.6 million in savings in fiscal
year 2008-2009; and
WHEREAS, the City Manager will reevaluate the actual savings generated from the early
retirement incentive program and hiring freeze mid year to determine whether additional savings
are available to reinstate all or part of the management and hourly salary increase.
NOW, THEREFORE, BE IT RESOLVED that the City Council of the City of Chula
Vista does hereby authorize the elimination of the scheduled fiscal year 2008-2009 cost of living
salary increases for management and unclassified hourly employees.
BE IT FURTHER RESOLVED, that the City Council does hereby authorize the City
Manager to reinstate all or part of the pay raises dependent upon the availability of funding.
Presented by
Approved as to form by
David R. Garcia
City Manager
-~~~\:)\~,.
Ann Moore
City Attorney
J:\Altomey\RESO\FINANCE\Elimination oreOLAs for mgml_04-IS.08.doc
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