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City workers worry over possible benefit cuts

Terri Harber
Appeal Staff Writer

Some Carson City employees are expressing concern about possible cuts in benefits or reimbursements.

An official e-mail sent by City Manager Linda Ritter detailed possible solutions to the projected budget deficit of $1.7 million during the next fiscal year, beginning July 1.

Several calls and inquiries about the memo and its implications came to the newspaper late this week.

Ritter, who is out on vacation and expected back at work early next month, sent the memo Wednesday to all employees with in-house e-mail accounts. It reads:

“As seen in recent headlines in the newspaper, we are not the only city seeing these declines. So you will not be surprised to hear that our budget deficit is growing,” she said. “Even though we were able to reduce expenses by $1.4 million earlier in the fiscal year, we have additional reductions to make.”

Employees don’t pay a share of the premium for their own health-care coverage, but share equally with the city the cost for dependent coverage, according to the city’s current benefits program.

This and other aspects of the employee insurance program are going to be reviewed. Potential dates for change could be at the beginning of the next fiscal year, July 1, or the start of the second quarter, Oct. 1.

Dependent-care coverage, if the total cost for dependent care shifts to the employee, could save the city up to $700,000, said Sue Johnson, the city’s finance director.

The full burden may not shift to employees, and it may not change at all, Johnson emphasized.

January’s sales-tax revenues are expected to be reported by the state early next week and “we’re anxious to see those revenues,” Johnson said.

Other costs to be scrutinized include annual raises and merit increase percentages; use of current staffing and opportunities for departments to restructure; types of services and the level at which they are provided. Supplies, travel expenses and training are also going to be looked over, according to Ritter’s memo.

“Layoffs will be the absolute last resort in balancing our budget,” Ritter also wrote. “I will stick with that commitment, but in doing so, other alternatives must be on the table.”

A variety of jobs have been left unfilled and a short-term program was offered last year allowing employees who were planning to leave city employment to obtain a bonus if they could provide evidence that would allow the city to not replace that worker and eliminate the need for the position altogether.

Employee salaries and benefits comprise 77 percent of the city’s budget of approximately $115 million. Cost for labor has risen by 24 percent over the past four years, but the number of workers has only gone up by 4 percent.

Written copies of the memo were to be provided to the rest of the city’s roughly 600 employees who don’t have e-mail.

Johnson cited such factors as the statewide sales cap tax and the economic slowdown in such areas as construction and the housing market as reasons why local governments are having to pare down operating costs.

While the employees have been worried, there are some large construction projects are now being reviewed by the city, said Andy Burnham, the city public works director.

Though revenue that would result from such new projects won’t completely fix the deficit problem, “it helps,” he said.

• Contact reporter Terri Harber at tharber @nevadaappeal.com or 882-2111, ext. 215.