Mayor proposes $20 million mid-year spending adjustment

November 30, 2021

Mayor Greg Fischer today proposed a $20 million mid-year spending adjustment from FY21 that will provide funding to update the city’s fleet, including outdated Public Works trucks, to match a potential federal grant, and for potential salary/wage boosts in FY22 to hire and retain quality Louisville Metro Government (LMG) employees.

The proposed ordinance sponsored by Metro Council Chair Bill Hollander – and shared with other Council leaders – will be considered at Budget Committee Dec. 9, and could be voted on by the full Council as soon as Dec. 16.

The $20 million adjustment reflects savings from LMG agency operations as well as unanticipated revenue growth in FY21, according to Monica Harmon, the city’s Chief Financial Officer.

“The Administration and Council expected some agency savings due to the impact of COVID-19, with operational changes due to limited services early in FY21 and recovery of certain expenses from federal grants,” she said, savings that was reflected in spending on the Mayor’s No. 1 priority, Public Safety, in the FY22 budget. “However, the savings was greater than expected, as reflected in this adjustment.”

The proposed funding would provide:

  • $1.5 million in matching funds for a federal Build Back Better Regional Challenge (BBRC) grant of $50 million, which the city is seeking with eight partners. BBRC is a $1 billion grant program designed to assist communities nationwide in accelerating their economic recovery from the coronavirus pandemic and building economies resilient to future economic shocks.
  • $5.7 million to purchase additional fleet, primarily to replace outdated sanitation equipment and dump trucks within Public Works.
  • $12.8 million appropriated to the Office of Management and Budget for potential salary and wage adjustments – both union and non-union – necessary to meet marketplace demands.

“This proposal builds on the work we’ve been doing to improve critical city services, retain the best and brightest city workers and build a sustainable, equitable economic recovery,” said Mayor Fischer. “I appreciate the partnership of Budget Chair Hollander, and I urge the full Council to approve this measure.”

Metro’s current turnover rate, just five months into the fiscal year, is 7.04%, and many of those leaving, union and non-union, say they are being drawn to the private sector in large part by greater compensation, said Ernestine Booth, LMG Director of Human Resources, who added that the city’s compensation ratio is lower than market.

“With limited funding over the past few years, many of our union contracts included wage increases of zero to two percent, and our non-union grid has not been adjusted since 2016,” Booth said, hamstringing LMG’s ability to compete with higher-paying local and national competitors.

Plus, here and across the country, Booth said, COVID-19 has created what the industry is describing as a “resignation tsunami,” as employees are expecting more flexibility (remote work), higher wages, and more paid time off. All this has the potential to impact LMG’s ability to provide the quality services that Louisville residents demand and deserve, she said.

Councilman Hollander agreed. “A better-than-expected revenue picture and federal funds have put us in position to address some of the salary issues which are hindering our ability to recruit and retain employees needed to serve the public,” he said. “Council members have been discussing these issues for months and I'm looking forward to consideration of this proposal at the Budget Committee on December 9, before final action at the Council meeting on December 16.”

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