SHELBY – Shelby City Council passed the first reading of an ordinance on Tuesday evening with the purpose of raising the salaries of members of council starting in 2018.
Councilman Nathan Martin proposed an amendment to Ordinance 2-2017 on Tuesday that would set the salary for each member of city council as .065 percent of the previous year’s appropriations annually, to be paid bi-weekly. Typically, council members’ salaries are a flat rate set by the outgoing council in odd-numbered years.
“I don’t see where our compensation is in line with the value we create, especially when you look at the salaries of trustees in other areas and what their duties are as opposed to ours,” Martin said. “I started thinking about ways we could effectively ascertain the value of what we bring.”
Current members of Shelby City Council earn a salary of $3,772 annually, set by the council of 2015. With Martin’s amendment, members of council from Jan. 1, 2018 through Jan. 6, 2020 would earn .065 percent of the previous year’s appropriations. Council determines the city’s appropriations in March of each year.
“My initial calculations at .065 percent per council member, that comes out to roughly $7,600 per year based off of this last year’s budget,” Martin said.
Martin’s estimate is based on the city of Shelby’s $12 million cash balance as of Nov. 30, 2015, according to Finance Director Steve Lifer. Take the $12 million multiplied by Martin’s formula of .00065, and the result is a hypothetical $7,800 annual salary for each member of city council. Lifer noted the city had a $13 million cash balance as of Nov. 30, 2016.
However, the ordinance language as it stands states that the salary is based on a percentage of the previous year’s appropriations annually, not the cash balance. On March 21, 2016, council unanimously passed Ordinance 9-2016 creating $36.2 million in total appropriations for the year 2016.
Based on Martin’s calculation, that would give each member of city council a salary of approximately $23,400 annually – six times their current salary. Council’s salary comes from the General Fund, which ended 2016 with a balance of $4.6 million according to Lifer.
Asked about these numbers, Martin said on Wednesday that the ordinance language would be corrected in future readings.
“The bottom line is our goal is to be in that $7,600 range,” Martin said on Wednesday. “If we do find out the appropriations are higher, we’ll make an adjustment.”
The reason for the increase, Martin said during council on Tuesday, is partly due to the scope of responsibility set on the shoulders of Shelby City Council.
“I look at the threshold for catastrophic failure,” he said. “If we made decisions poorly, what level could we bring the city towards catastrophic consequence? Because of our size and scope, we could put the citizens of Shelby on the book for a lot if we made poor decisions.”
Shelby’s city council is on the lower end of salaries based on surrounding areas, according to Councilman Garland Gates. According to Gates, members of Galion council currently make $4,200 annually, while Ontario makes $5,566 and Bucyrus makes $6,179.21 annually.
Gates pointed out only Galion and Shelby are full-service cities providing both police and fire protection, water, wastewater, electric utilities and a city health department.
Both Martin and Gates also mentioned the difference in salaries of Shelby City Council compared to area township trustees.
“At the risk of sounding jealous, the salaries for township trustees and township fiscal officers are set not by the trustees in individual townships, but by the general assembly,” Gates said. “Our good friends who are trustees in Jackson and Sharon Township are getting around $10,000 a year each to be a township trustee. With all due respect, we have much more responsibility than do they.”
Gates also noted to earn a year’s service credit with OPERS, the largest public pension fund in Ohio, an employee must earn at least $600 per month, or $7,200 per year. However, Martin noted that retirement is not the only goal of the salary increase, but also to help attract the next generation of public servants.
“It’s a lot of work, and people attracted to city council tend to be retirees,” Martin said on Wednesday. “We don’t get a lot of younger folks and others interested because it’s a lot of work for $300 per month. I’ve had people who are trying to recruit for seats say it’s a lot to ask.”
Both Martin’s amendment and the first reading of Ordinance 2-2017 passed with a 4-5 vote on Tuesday, with only Councilman Steve McLaughlin dissenting. The ordinance will be brought up for a second reading at council’s next meeting on Tuesday, Jan. 17.
Once the ordinance passes, the salaries set by this council will not go into effect until 2018. All five Shelby City Council seats are up for election in the upcoming November 2017 election; the filing deadline is Feb. 16.
“I know it’s a touchy subject when you’re looking at raising the salary for us, but this doesn’t go into effect until next year so each one of us will have to answer to that during an election if we so choose,” Martin said on Tuesday. “Regardless of the seat that I hold, I think this is fair and equitable.
“This is a very active council; we’re trying to look at ways to bring our city along in the 21st century. I think the small percentage I have there is very well justified.”
