ST. LOUIS, Missouri — Budget woes at City Hall may mean less pay than some city workers were expecting, and recruiting struggles at the police department could mean longer days for many officers.
The top three women in city government convened at the Board of Estimate and Apportionment on Wednesday to discuss the city's fiscal future.
Mayor Tishaura Jones and her budget advisers previewed their spending plan in a presentation for Comptroller Darlene Green, and Board of Aldermen President Megan Green. Their questions highlighted a number of key questions facing policy makers in the months ahead.
Pay raises postponed?
"We were not able to do the 3% additional raise this year that we had done for city workers the last two years," President Megan Green said after she left the meeting. During the meeting, Green called the news "disappointing to some city employees."
"Employees are getting a 1.5% percent merit increase," Mayor Jones said during the meeting. "They're just not getting the additional 3% that they've gotten in last three years."
Separately, a mix of projected short-term and long-term fiscal pressures prompted Jones to enact an emergency hiring freeze late last month. Her announcement barred city agencies from posting new job openings for any "non-essential" positions.
Hiring freeze
Green questioned the necessity of the hiring freeze, which stems, in part, from the Board of Aldermen's recent move to override the mayor's veto of a plan to consolidate two separate firefighter pension boards into one.
"We consolidated the two pension boards that should save about $500,000 per year," Green said. "It does not change the current pension system, we still will have two pension systems, the FRS and the FRP."
Under the new system, one collective board, comprised of firefighters and city appointees, will oversee the old Firefighters' Retirement System (FRS) and the newer Firefighters' Retirement Plan (FRP). The newly designed board revokes some of the mayor's power to appoint trustees to oversee pension investments, and gives majority control to firefighters.
"I think it's time after 12 years to empower workers again in our city and put the folks who are most impacted by those pension decisions back and control their own destiny," Green said.
Veto vengeance
The Board of Aldermen's rare move to override Jones' veto of the pension consolidation plan appeared to create something of a personal rift between allies at City Hall. Not long after the vote, several aldermen that voted to override the mayor noticed she had 'unfriended' them on her Facebook page.
Comptroller Green, whose office holds a board seat on the old pension board and the new one, defended the Slay administration's decision in 2012 to switch new firefighters over to the FRP.
"There’s been a $10M savings reported by the mere fact that we were able to go to an alternative and freeze FRS and go to the alternative of FRP," Comptroller Green said. "For those hard-working firefighters, we want to preserve the right for them to collect their hard-earned pension when they deserve it."
Alderman Bret Narayan (D-4th Ward) said his proposal to combine both groups of pensioners under one board of trustees "has virtually no fiscal impact on the City," but, "future decisions by the Board of Aldermen and mayor may."
Comptroller Green cosigned those remarks, cautioning against any imprudent fiscal maneuvers in the future.
"When we ‘saved’ the system, we had a savings that is undeniable. The reason behind going to the second board in the first place is so that there could be savings," the comptroller said. "Now there are other decisions that can be made with the new management. Let’s see what happens."
The fiscal fights ahead include much bigger headaches and could further test the political or personal divisions at City Hall.
Remote work and earnings taxes
Some of the same pandemic-era policies that showered St. Louis city coffers with $498 million in federal cash could soon drain the city from one of its most reliable long-term local revenue streams.
When shoppers and workers started conducting business and commerce from their homes to avoid crowded public places, Congress rushed federal relief to prop up local governments that relied heavily on foot traffic and the sales taxes that come with it. But now that so many workers have continued to work remotely from their homes outside the city limits, the city's 1% tax on their earnings has come under scrutiny in courts and the state legislature.
"Most of the general fund comes from the earnings tax, property tax, and sales tax, with a few other taxes and fees included," Mayor Tishaura Jones said in a livestream video on Instagram on Wednesday night. "I want to be transparent and share that these figures are subject to change as the Missouri State Legislature is exploring options to eliminate or reduce the earnings tax which will significantly impact our budget."
In a 2021 ballot measure, 79% of city voters opted to renew the 1% earnings tax for another five years. However, House Republicans in Jefferson City approved a measure that would allow remote workers to request a refund and opt out of paying into the earnings tax.
No House Democrats voted for the measure. None of the members who voted for it live in city limits.
Vacant jobs lead to city savings
Paul Payne, the city's budget director, offered a rough estimate of the impact of losing the earnings tax at $25.9 million in the upcoming fiscal year.
Because the city budget still sets aside funds to fill so many vacant jobs, there appears to be enough of a cushion in the spending plan to absorb the losses. In other words, the potential loss of revenue would not necessarily lead to layoffs, but could stall hiring at current staffing levels and cost current city workers another raise.
When the city leaves budgeted jobs vacant for a full year, those funds automatically roll over into cash reserves and a capital fund.
"We've had some success in restoring reserves to a level which is considered healthy compared to where we were about 10 years ago," budget director Payne said.
During the budget exchange, President Megan Green suggested the city could unlock those unused funds set aside for vacant jobs and rush the funding to pay for more dire emergency infrastructure needs.
Mayor Jones suggested that there's another benefit in hoarding funds in reserves: The city protects its credit rating with bond ratings agencies and increases the likelihood of a lower interest rate for any future projects that require borrowing, such as the airport or MetroLink projects she said are "coming down the pipeline."
"The first priority for our city really should be filling the vacant positions we have throughout city government, because that impacts the quality of city services," Green said as she left the meeting.
Police consider 11-hour, four-day shifts
The police department continues to struggle to hire enough new recruits to keep up with the rate of attrition.
According to a public database of trained officers on the force, the city currently has 352 vacancies in a police department that is authorized to hire up to 1,224 officers.
"Our police and fire departments will not see an increase or decrease this year and they will stay roughly the same," Jones said.
RELATED: St. Louis police exploring 11-hour shift schedule to improve coverage due to officer shortage
However, the written proposals in her budget document rearrange which revenue streams pay for police salaries, and they move $2.5 million out of regular police payroll to cover higher overtime expenses.
An aide in Jones' office said the budget reductions in regular police payroll to pay for higher overtime costs do not constitute a reduction in the authorized strength, because new recruits cost less than veteran officers who have earned higher salaries.
While Jones and her budget advisers consider ways to move money around, police brass are weighing their options for shifting officers' schedules.
"We are understaffed. And so any schedule change that may allow for longer shifts that then may provide for additional coverage are certainly things that we're going to look at," Sgt. Charles Wall said during a press briefing on Wednesday.
According to internal police memos obtained by 5 On Your Side, police captains, majors, and colonels huddled on Thursday morning to discuss ways to adapt to a shift rotation where officers could work for four, 11-hour days, then take four days off.
"I think long days like that can lead to fatigue," Board of Aldermen President Green said. "And I'd be curious to hear what the workers who would be involved in such a policy have to say about it."
Return to in-person meetings?
Very little can happen in the city of St. Louis without approval from the Board of Estimate and Apportionment. So why is such a powerful meeting still happening over Zoom?
"I'm happy to have the conversation with the mayor and the comptroller," President Green said. "I see no reason why we can't get back in person."
"I'm ready to be with the people when they want me to be with them," Comptroller Green said. “That certainly can return anytime. I am in City Hall doing the work, just like the other members when they can be. We can make that decision whenever it gets made. They can say, ‘Let’s do that.’"
The Mayor's office, which had previously signaled an openness to return to in-person meetings, said on Wednesday, "There is a helpful flexibility in some meetings, like E&A, being virtual."