Explaining their decision as leading by example, the San Luis Obispo City Council agreed to take pay cuts ahead of major upcoming union negotiations.
On Dec. 6, the council voted 3-2 to adopt the pay cuts, which amount to roughly an 8-percent overall decrease for the city’s appointed officials, department heads, managers, and some unrepresented senior employees.
Under the resolution, the city would also cease paying the employer contribution to the California Public Employees Retirement System, becoming the first city in SLO County to do so.
The cuts would amount to an estimated $807,000 in savings annually, or about a quarter of what the city is trying to save as it attempts to rid itself of $3.1 million in compensation costs, or roughly 6.8 percent per employee.
The pay cuts will go into effect Jan. 1 and will remain indefinitely, pending any future action by a future City Council.
In June, the council adopted a two-year spending plan that trimmed $4.4 million from the city’s approximately $99 million budget in the first year.
While the majority supported the proposed cuts, councilmembers Kathy Smith and Dan Carpenter thought the plan didn’t go far enough.
“Frankly I’m disappointed,” Smith said. “I anticipated some dramatic financial leadership here. I’m going to bow to voters … it’s their tax dollars we’re spending.”
City Manager Katie Lichtig, whose base salary currently stands at $221,500, further agreed to completely eliminate her $450 monthly car allowance, which she had previously suspended.
Councilman Andrew Carter noted that city employees haven’t had a cost-of-living increase since 2009.
“It’s a good first step, an important first step,” Carter said of the new cuts.
The city has been in negotiations with its employees’ unions since September. Those contracts expire Dec. 31.
The SLO decision comes a week after leaders for Atascadero cut their compensation rates between 1 and 3 percent, mostly through voluntary furloughs.