Five of six employee groups for the City of Hollister have
agreed to accept a 5 percent pay cut, a top city official informed
council members Monday. City officials have been negotiating with
employee representatives for more than two months and recently came
to informal agreements with five of them, with the police union the
last remaining group in talks.
HOLLISTER
Five of six employee groups for the City of Hollister have agreed to accept a 5 percent pay cut, a top city official informed council members Monday.
City officials have been negotiating with employee representatives for more than two months and recently came to informal agreements with five of them, with the police union the last remaining group in talks, City Manager Clint Quilter said.
The moves – which will be made official once officials complete paperwork for employees – are set to save the city about $570,000 this year and another $800,000 in 2010-11. The lower amount in 2009-10 is due to the reductions occurring more than three months into the fiscal year.
Before the pay cuts take effect in November, the city and each group also must decide whether to employ basic reductions or furlough time. Quilter noted how “in some areas, it’s very difficult to do furloughs.”
In August, Quilter had pointed out how the city faced a $1.6 million deficit this fiscal year. To close the rest of the deficit beyond the pay-cut savings, officials plan to replenish a general fund reserve that is heading toward a zero balance by transferring over most of the revenue from the sale of the old Fremont School property to the county for the new courthouse.
The city’s Redevelopment Agency sold the property for slightly less than $1.4 million. Since RDA funds legally are restricted to economic improvements or affordable housing, officials devised a formula – assuming the lot would have produced a certain amount of tax revenue – to allow for discretionary use of the money in the general fund used primarily for employee compensation.
They came up with a split of 87 percent going to the general fund and 13 percent heading back to the RDA, Quilter said.
With the additional injection, the general fund reserve would increase to $3 million this fiscal year. If conditions don’t improve, however, officials estimate it would be at around $767,000 by 2011-12, according to a report given during the meeting.
Look back for more on the cuts and officials’ intention to transfer RDA money to the general fund.
