Council makes amendments to city budget

Homer’s next budget is another step closer to being finalized after Monday’s City Council meeting, where several amendments were added to it.

The city’s 2018 budget has one more public hearing left on Dec. 11, after which the council will vote on adopting it. At their Monday night meeting, council members tackled several adjustments to the budget brought by members, City Manager Katie Koester and Mayor Bryan Zak. Chief among them was an amendment to include a .5 percent cost of living adjustment for city employees, which generated a lengthy debate.

The adjustments made to the budget include:

• The .5 percent cost of living increase for city employees, sponsored by Zak, cut in half from a 1-percent raise originally proposed by the Employee Committee.

• A $9,394 increase in salary and benefits for the Finance Department to “rearrange duties and hire (a) qualified accountant,” which was sponsored by Koester. “I think it’s clear that we need more help in the Finance Department,” said council member Heath Smith. “So, we need to move towards being fully staffed and more capable of generating less errors, and more eyes and hands on that kind of stuff is going to help us.”

• An adjustment sponsored by Smith to move $1 million from the city’s Health Insurance Fund and split it up among four other city accounts: the fund for a future police station will get $669,212, the Port and Harbor Reserves will get $171,429, the Water Reserves will get $88,424 and the Sewer Reserves will get $70,936. The Health Insurance Fund has about $1.6 million in it currently, Smith said, the majority of which came from when the city used to be self-insured. “That fund currently I think, basically is a subsidy fund for any wild swings in costs when we get back our annual increases on policy. So, it’s just a lot of money. I think there’s some prudence in having a fund to allow us to react to any wild swings … but I don’t think $1.6 million is an appropriate amount to have in there,” he said.

• A $33,415 transfer from the Water Reserves fund to pay for stewardship costs for preserving about 300 acres of land in the Bridge Creek Watershed, sponsored by council member Shelly Erickson.

• A $10,000 increase in funds to the Homer Public Library book budget, sponsored by council member Donna Aderhold. Representatives of the library and the Friends of the Homer Library testified during public comment opportunities that books get worn out very quickly while being circulated by the library, and that these funds will go to replacing them. Council member Tom Stroozas questioned the necessity of the funds during the Committee of the Whole meeting, to which Library Director Ann Dixon answered that it would actually take $20,000 to maintain the library’s current levels of collections and development, but that the library can make do with $10,000.

• A $750 allocation from the Park Reserves fund to pay for three signs to be posted at “points of entry into Kachemak Bay to warn recreational users of the hazards of cold water and limits of emergency response capabilities,” sponsored by Erickson. Council member Caroline Venuti moved to amend the adjustment to stipulate that the measure has to go through the Parks, Art, Recreation and Culture Advisory Committee before the signs come to fruition. No one opposed that amendment, and the budget adjustment passed.

When it came to passing the cost of living adjustment for city employees, council members debated the topic at length, with some saying that for the most part employees get raises to cover the cost of living hikes, and others arguing that it’s hard to afford living in Homer without cost of living adjustments. Erickson commented that the council had approved a cost of living adjustment last year with the understanding that there wouldn’t be another one to approve this year.

“Our employees, for the most part, are on a scale,” Smith said. “They get raises, and there are a number of employees that got anywhere from a 2 to an 8 percent raise this year. … I think that that’s more than adequate to keep pace with any inflation, plus give them more.”

A few city employees testified to the council that, since they were hired, their original work agreements have been changed. Members of the Employee Committee, who had originally asked for a 1 percent cost of living raise, or a $90,000 line item, told the council that, compared to cost of living adjustments from the Salary and Benefits survey and the Anchorage Consumer Price Index (CPI) from by the Alaska Department of Labor, Homer’s employee wage scale has fallen behind the survey average over the past six years by 5 percent.

Stroozas proposed an amendment that reduced the original proposal from 1 percent to .5 percent, or $45,000, which passed.

Council member Rachel Lord said she agreed with the compromise because it’s important to make the employees feel heard and that their needs can be met. Retaining qualified staff members for the city is important, she said.

“For future planning and budget purposes, the Employee Committee recommends that the Homer City Council consider implementing regular, incremental COLAs (cost of living adjustments) relative to the annual change in the Anchorage Consumer Price Index, rather than trying to catch up through the implementation of sporadic, larger COLAs, realizing that these COLAs are challenging to budget for,”said Employee Committee Chair Matt Clark.

On the actual amendment to the budget regarding the cost of living raise, the vote was 5 yes to 1 no, with Smith being the lone dissenting vote.

Residents have one more chance to comment on the 2018 budget before it is voted on, at the council’s Dec. 11 meeting at City Hall. Written comments can be emailed to council members, whose contact information can be found on the city’s website.

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