Ellettsville’s full-time employees could get a $10K raise from income tax hike

A proposal to give every full-time employee a $10,000 raise next year is causing some division among leaders in the town of Ellettsville.

The raises would cost the town about a half million dollars and contribute to a spending hike of nearly $1.4 million for 2023. Overall spending would increase 28% from this year. The bulk of that increase, just over $1.1 million, would come from a county income tax hike pushed through this year by the Bloomington City Council.

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Ellettsville Town Council President William Ellis said the raises would help halt an exodus of town employees, especially in public safety. However, fellow council member Dan Swafford said passing the budget as proposed would be irresponsible.

Town Manager Mike Farmer, who proposed the raises, said many employees have not gotten raises at all in five of the last 10 years, and many are not making enough to be able to afford a decent living in Monroe County.

The town’s 46 full-time employees, excluding town council members, earn base salaries between $38,480 for laborers and $72,523 for the police and fire chiefs. At the low end, a $10,000 pay increase would amount to a 26% raise, while for the chiefs, the raise would be nearly 14%.

Council to discuss budget Monday

The town council will discuss the budget proposal in its Monday meeting, which is scheduled to begin at 6:30 p.m. at 1150 W. Guy McCown Drive.

William Ellis, president of the Ellettsville Town Council

Ellis said the town has to “right-size” its salaries because it keeps losing employees, which costs money in the form of recruitment and training.

In addition, he said, the hikes are being made possible by the income tax hike that was forced upon the town by the Bloomington City Council. Bloomington officials in May increased the local income tax by 0.69 percentage points. The tax is paid by almost everyone who lives in Monroe County and earns an income. The hike will mean an extra $345 or so per year in income taxes for individuals or couples who, after varying deductions, have a state adjusted gross income of $50,000.

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Ellis said the Ellettsville town council had no input on the tax hike and even examined, albeit unsuccessfully, whether it could refund the tax to Ellettsville residents. The town council also rejected an additional property tax increase beyond the 5% approved by the state.

Public safety spending

Beyond employee retention, Ellis said constituents have mostly complained about “crime trickling in from Bloomington,” prompting a proposal to increase public safety spending. The new budget calls for the hiring of one additional police officer and two firefighters.

Ellettsville Fire Chief Kevin Patton said eight of the department’s 11 career firefighters have had to be replaced in the last couple of years, with all but one going to another fire department. A $10,000 raise per firefighter would make the local department more wage competitive, he said.

The turnover and staffing shortage is making it more difficult to send enough firefighters to emergencies, Patton said. At full staff, a fire engine would leave a station with three firefighters, but because of vacation and sick time, the Ellettsville engines usually leave with a crew of two. And that often means the department has to request help from nearby departments.

Fire department staffing levels

Patton said current staffing levels mean the department cannot meet some federal guidelines for fire departments, such as having 10 to 12 firefighters on scene in less than 10 minutes.

He said he understands that young firefighters view the small Ellettsville department as a training ground, but with staffing shortages almost everywhere, the department is now losing firefighters because of a pay difference of $1,000 or $2,000 per year — and because larger departments can guarantee that fire engines leave with a crew of at least three, which means more safety for the firefighters and a lower risk for property damage or deaths.

Patton, who has been with the department for 35 years, said the two additional firefighters and the $10,000 raise would “at least slow down some of the turnover.”

Swafford, the council member, said the town spent $25,000 a couple of years ago on a wage study and then increased employee wages to make them competitive. Raises at the time averaged near $4,500, he said.

He said he can support hiring more safety personnel and giving those employees big raises, but not at the same time as giving big raises to every other employee.

“I wish we could give them a million dollar raise but we’ve got to be fiscally responsible,” he said.

Farmer, who has worked as town manager for three years and as utilities director for 23 years, said that as an employer, the town has the responsibility to provide people with adequate wages and benefits.

In addition, he said, given the level of competition for workers, the town has to increase wages if it wants to attract and retain talented, hard-working employees who often spend extra time on town business, which means it keeps them away from families.

Even with the $10,000 raise, town employees won’t be getting rich, Farmer said. The town should have a discussion less about the size of the raises and more about how much it is paying its employees.

Excluding the dollars from the income tax hike, the Ellettsville budget proposal for 2023 would be about $250,000 or 5.1% higher than this year, though the comparison is skewed as the costs of seven existing public safety officers have been moved out of the town’s general fund, its main operating fund.

The town has ample spending reserves. In the general fund, the town had a cash balance at the end of last year of nearly $2 million, or 63% of annual spending. The Government Finance Officers Association recommends a reserve of at least 16.7% of annual spending. The city of Bloomington targets 33%. The town of Ellettsville has carried a surplus in its general fund every year since 2014, according to Gateway Indiana, a government finance portal.

This article originally appeared on The Herald-Times: Ellettsville considering $10,000 raise for every full-time employee