At the Flagstaff City Council’s final budget retreat of the fiscal year this week, members voiced the need to make public safety a priority but were faced with growing pension costs for those retired from the same departments.
At the meeting the council directed city staff to explore a 3 percent merit-based pay increase for sworn police officers. Many council members expressed worry about attrition and persistent vacancies in the department.
Kevin Treadway, the police chief who is serving as deputy city manager, said the department lost 18 officers last year and 16 the year before. Hiring an officer is also a lengthy process, Treadway said.
The proposed budget for the 2019 fiscal year includes an additional $1 million ongoing contribution to pension costs for public safety personnel. The increase will eat away at much of the revenue growth the city saw in the past year, Interim City Manager Barbara Goodrich said in an interview before the budget meeting.
“Our financial health continues to improve, but an equal amount of fixed cost continues to increase,” she said.
At Tuesday’s meeting, Goodrich suggested that after the council’s summer break, the council discuss a possible sales tax dedicated to funding the city’s required contribution to the pension system, which would mean the city would no longer have to allocate general fund money to the system and could instead fund other programs or more positions.
Flagstaff’s unfunded liability is over $100 million, Goodrich said at the meeting.
Prescott passed a tax to fund its portion of the pension benefits, which was expected to raise $11 million to $12 million per year.
The budget also includes hiring two new police officers and three police aides. The funding for the officer positions will come from the second phase of increase primary property taxes. Last year, the council approved a 7 percent increase to the primary property tax levy, or the revenue the city collects in property taxes. The upcoming budget also includes an additional 7 percent increase.
The council also directed the staff to create a policy for four weeks of paid family leave for the birth or adoption of a child. Goodrich said the staff should be able to find a way to have that benefit be funded through ongoing funds, and would cost about $40,000 per year.
Goodrich proposed 10 new positions be funded through the city’s general fund and seven new positions be created using specialty funds. City payroll documentation shows the city having more than 700 employees.
The total ongoing costs for new personnel will be about $5 million. However, all but one of the general fund positions will be “offset” by savings elsewhere, usually by eliminating the need for outside contracted work to perform that job.