City of Gonzales
CITY MANAGER DEPARTMENT
STAFF REPORT
TO: Honorable Mayor Rios and City Council
DATE: January 18, 2022
FROM: Rene Mendez, City Manager
SUBJECT: Resolutions No. 2022-06 and No. 2022-07 - Miscellaneous and Management Employees Level of Benefits
RECOMMENDATION
It is recommended that your City Council consider and adopt:
• Resolution No. 2022-06, A Resolution of the City Council of the City of Gonzales Establishing the 2022-2024 Level of Benefits for Miscellaneous and Fire Safety Employees; and • Resolution No. 2022-07, A Resolution of the City Council of the City of Gonzales Establishing the 2022-2024 Level of Benefits for Management Employees.
BACKGROUND
As your Council is aware, because neither the Management or Miscellaneous employee groups are represented as a bargaining unit, and neither have a Memorandum of Understanding (MOU), any changes to their benefits need to be done via resolution. Staff recently negotiated MOUs with the Public Works bargaining unit and the Police bargaining units, which are part of this agenda.
REVIEW AND ANALYSIS
The attached resolutions include the following changes and recommendations.
For both Management and Miscellaneous:
1. Salary Adjustment Schedule:
• First Full Period of 1/2022: 3.5%
• First Full Period of 1/2023: 3.75%
AGENDA
ITEM
18 • First Full Period of 1/2024: 3.75%
2. Increases the progression between steps in the Salary Schedule from 4 to 4.5%.
3. Reflects a new step to the Tenured (longevity) Pay incentive by adding an additional 2% bump in pay at 30 years of continuous employment with the City.
4. Increases the safety boots allowance from $150 to $200 maximum per year.
For Miscellaneous employees:
5. Adds a deferred compensation match contribution of up to $600 per year.1 Employee must be in active status at the time of the City Contribution.
These are consistent with the MOUs with the Police and Public Works units.2 The proposed changes are being recommended to remain competitive with South County cities, enhance retention, promote longevity and to acknowledge the great work being done by all of our employees. Especially over the challenging last 2 years, they have more than stepped up to help our community get through the COVID-19 pandemic.
Explain Recommendation and How it Supports the Vision
Gonzales will continue to be a safe, clean, family-friendly community, diverse in its heritage, and committed to working collaboratively to preserve and retain its small-town charm.
Explain: Recommending salary and benefit adjustments for our employees when financially feasible and prudent, is important to maintain a healthy and productive work environment needed for the City employees to execute all the work, initiatives, projects, programs, and tasks needed to support the Vision for Gonzales provided by the Council.
Explain how the Recommendation Directly Implements the Mission The City Council and Staff of the City of Gonzales will realize our Vision by providing the leadership, commitment, and resources necessary to provide excellent services that enhance the quality of life of our diverse community.
Explain: Please see explanation above for the Vision.
City services will be delivered in a cost-effective, respectful, and friendly manner to insure the safety and well-being of the residents and the promotion of business, recreational, housing and employment opportunities in an environmentally sustainable manner.
Explain: Please see explanation above for the Vision and Mission.
Strong fiscal policies allow us to provide appropriate infrastructure for:
1 This equates to the City contributing $.20 (twenty cents) for every $1.00 (one dollar) an employee contributes to deferred compensation. Employee would need to contribute $3,000 (three thousand dollars) per year to realize the full City yearly contribution.
2 The Management Employee benefits package will automatically be applicable to City Manager/Executive Director René Mendez. Section X of his Employment Agreement states that he receives the same benefits, including retirement benefits, as are provided to the City’s Management Employees. • Public Safety X Yes No N/A
• Housing X Yes No N/A
• Recreation X Yes No N/A
• Environment X Yes No N/A
• Education X Yes No N/A
Explain: Recommending salary and benefit adjustments at a reasonable and meaningful level during times when financially feasible and sustainable, is prudent and necessary to maintain the personnel infrastructure necessary for all these priority areas.
ALTERNATIVES
Alternative 1 – The City Council could choose to not approve the resolutions as too expensive and direct staff to modify them. Staff recommends against any changes, because the adjustments are prudent, financially feasible, sustainable, and sends a very positive message to the workforce.
Alternative 2 – The City Council could reject the idea of increased salaries and not approve the Resolutions. Staff believes the recommended increases are warranted.
BUDGET IMPACT
If approved, the recommendations are expected to have a three-year financial impact of approximately $332,200 spread out over several funds. The cost increase reflects the proposed COLAs, the increase in the step progression in the Classification Schedule and assumes 100% participation in the deferred compensation match program. It does not reflect costs from the longevity adjustment and the increase in the allowance for boots since that is very minor. The incremental financial impact per annum of approximately for 2022 are $103,200 ($51,600 for the remainder of the 2021-2022 Fiscal Year); for 2023 are $112,400, and for 2024 are $116,600.
It is important to note that the estimates are based on existing personnel and reflect several assumptions on the possible application of benefits. It is possible that the actual cost impacts will vary depending on future personnel, and/or benefit costs. It is anticipated that the increases can be covered with existing appropriations in the Council Approved FY 2021-2022 City Budget; however, if needed an adjustment will be brought back as part of the FY 2021-2022 Mid-Year. Further cost impacts will be built into the budget for 2023 and 2024. Over the long term, with the expected and currently underway growth in the Gonzales Agriculture Industrial Park, projected revenues in Property and Sales Tax, and other funding sources, there will be sufficient resources to cover the increase.
CONCLUSION
It is recommended that your City Council consider and adopt:
• Resolution No. 2022-06, A Resolution of the City Council of the City of Gonzales Establishing the 2022-2024 Level of Benefits for Miscellaneous and Fire Safety Employees; and • Resolution No. 2022-07, A Resolution of the City Council of the City of Gonzales Establishing the 2022-2024 Level of Benefits for Management Employees.
Attachments:
1. Resol 22-06 Benefits for Miscellanous Employees
2. Resol 22-07 Benefits for Management Employees