SPRINGDALE -- City employees would see pay increases if the City Council accepts the 2022 budget of $57 million proposed this week by Mayor Doug Sprouse.
The city earlier this year retained Johanson Group for a labor market study. The resulting report said the city needed to increase pay to all positions to keep the city competitive in the Northwest Arkansas job market.
This will cost the city about $3 million in 2022, said Colby Fulfer, the mayor's chief of staff.
The City Council will review the budget in an all-day work session today.
Sprouse and Fulfer said the budget follows the city's practice of conservation in its spending. The city sits in good financial shape, with sales tax receipts up 12% over the past year, Fulfer said.
The 2022 operating budget of $52,924,050 calls for an 8% increase over the 2021's $52,849,050. A 6% increase is more typical, Fulfer said.
Expected revenue for the city in 2022 is $62,671,700 -- up 17% from $53,369,720 since 2020.
City officials also project 2022 ending with nearly $5 million going into the budget's undedicated reserve fund. Council members often call on this fund for capital improvement projects throughout the city. Officials expect to end 2021 with $1.1 million added.
The 2020 census figures released earlier this year show Springdale with almost 90,000 people. The growth of the city has increased tax revenue but also has brought more responsibilities and costs to the city, Sprouse said.
Council members Tuesday received copies of Sprouse's proposed 2022 budget. Council member Brian Powell said nothing stood out to him as a red flag.
"It seems fairly simple," he said. "Then it's up to us, the council, to make sure we spend the money wisely to get the most bang for the buck."
Sprouse said the labor study found the city must compete for employees with the private sector more than with other cities in the region. The city invests a lot in starting positions, hoping employees will realize working for the city can be a good career.
The city provides ensured work hours, training and benefits workers might not find in the private sector, he said.
"We will never be able to match dollar for dollar what's paid in the private sector, but we work to add more value to the jobs with guaranteed work hours and benefits," Sprouse said.
The proposed pay increases are based on each job as it relates to the labor market.
Most full-time employees would see a 7% to 8% raise in pay, Fulfer said. Part-time compensation would rise about 4% or 5%.
He noted the increased pay rate will put about $32 million in the budget, and new positions will require about $700,000.
The Fire Department asked for seven new positions; Parks and Recreation, four; Planning Department, one; and District Court, one.
The Fire Department has asked for four upgraded administrative positions and three new civilian positions. The opening of three new fire stations over the past three years led to more positions for young firefighters, said Chief Blake Holte.
Sprouse said the 2022 budget is the most "comfortable" he has proposed in his 12 years as mayor.
The 2021 balance between revenue and expenditures is expected to put $1,107,770 in the unreserved category. The city in 2019 had to pull $905,701 from the unreserved category to meet that year's budget of $54,274,426.