Recession and an unknown future put COLAs on the table
Recession-minded town fathers entering the 2010 fiscal year budget process will include normally sacrosanct expense items, such as cost of living wage adjustments (COLA), in their budget building.
The message to town department leaders is the same from Chilmark to Oak Bluffs: if you want a raise, find the money elsewhere in your department's budget.
That's exactly the message Oak Bluffs managers received. "We have a target for a three-percent COLA, but to achieve it, we have to find the money elsewhere in our budgets," finance director Paul Manzi said this week.
Chilmark selectmen have been equally clear. "A level-funded budget means zero increase," J.B. Riggs Parker told library director Ebba Hierta late last month.
Ms. Hierta noted that finding money in a budget that is two-thirds salary is difficult. She faces a situation shared with Island colleagues: how to find money in a budget with few discretionary spending line items.
For most Island towns, other than West Tisbury, COLAs are either mandated by union contracts - police and public works departments, for example - or are discretionary for administrative and professional workforces.
"COLAs are definitely up there on the list of topics on the table," said West Tisbury finance committee member Brian Athearn. "I can't remember the last time I got a five-percent raise in the private sector," he said this week. "On the other hand, you want to take care of town employees and keep them happy."
Mr. Parker said recession is a good time to be a municipal employee, particularly on Martha's Vineyard. "We are reading about downsizing and layoffs, including municipal employees in other places," he said. "That's not going to happen here, in all likelihood.
"We have a responsibility to create a level budget for the town to consider at annual town meeting. Our residents, many on fixed incomes and pensions, have seen the value of their life investments decline substantially in recent months. If we can create a level budget that includes a cost of living adjustment, then so be it. The town has the right to change the budget at town meeting if they so choose."
Like several Island towns, Tisbury ties its discretionary wage adjustments to the Consumer Price Index. "The last reported quarter indicated a 4.1-percent rate, but the next one will probably be lower," reflecting the impact of recession, tax collector Tim McLean said.
COLAs aside, budget making is particularly tricky this year. "I don't ever recall a budget period with so many unknowns," reported Mr. Manzi. He is keeping an eye on excise tax receipts, generally $600,000 to $700,000 annually or between three and four percent of the $12 million town budget.
"Auto sales are off, and we don't have Island dealerships, so it's difficult to judge what the effect will be," Mr. Manzi said, noting that excise payments from the state have been as expected and on time to date. "But we won't really know the complete picture until they report in March at the end of our budget process."
Tisbury has the same difficulty in handicapping the financial future. "The recent drop in gasoline prices has been a savior for us, given the run-up in prices earlier in the year," Mr. McLean said, adding, "The finance committee is really looking at fuel, but there's really no way to predict it."
West Tisbury has experienced both the positive and negative effects of wild price swings in heating fuel prices. "We got the benefit of a lower rate this year than the market price because we lock in rates early in the year with Packer Fuel," town treasurer Bruce Stone said.
However, during the summer price run-up, West Tisbury locked at $4.02, well above the current price of $2.49. "We've heard some grumbling about that, but Ralph (Ralph Packer, president of Packer Fuel) ate the difference last year. We budgeted at the higher number, so we should be okay," Mr. Stone said.