FTPA Releases Study of Employee Salary and Wage Increases

FTPA Releases Study of Employee Salary and Wage Increases

News from:
FRAMINGHAM TAXPAYERS ASSOCIATION
Contact: Steve Kruger
(508) 788-1777

For immediate Release
FTPA Releases Study of Employee Salary and Wage Increases
Study reveals that general pay increases have far exceeded the increase in cost of living for the past twenty years and points to the need for stricter adherence to existing policies.
FRAMINGHAM, MA - February 9, 2004 - The Framingham Taxpayers Association has released a study of general salary and wage increases granted by the Town of Framingham to its employees. The study analyzes the history of general salary and wage increases since July 1, 1981 - the date that Proposition 2 1/2 went into effect. The summary presented in the study states that:
"In granting general salary and wage increases since Proposition 2 1/2 went into effect, the Town appears to have placed undue emphasis on how much money happened to be available, and insufficient emphasis on how much was justified by actual changes in the cost of living and what was sustainable given the up and down nature of our economy. Since Proposition 2 1/2 went into effect, the general increases in salaries and wages (often referred to as cost of living adjustments, or COLA's) granted to our employees have exceeded the increase in the Consumer Price Index (CPI) by more than 14 percentage points on a cumulative basis. The cumulative dollar value of the amount by which COLA's have exceeded the increase in the CPI since 1981 is on the order of tens of millions of dollars. The Town has policies in place that, if used effectively, should allow us to manage general salary and wage increases more carefully. However, these policies have not been utilized effectively, a situation which must be corrected quickly."
In commenting on the study findings, Enzo Rotatori, a member of the FTPA Executive Committee, stated "Many people have criticized Proposition 2 1/2 for causing a decline in our ability to pay for municipal services. This study clearly dispels that criticism as a myth. Not only have pay increases exceeded 2 1/2% per year, they've exceeded the rate of inflation -which has been higher than 2 1/2% per year. Despite Proposition 2 1/2 limits our spending has been continuing to rise at an alarming rate, and this study highlights one of the key reasons for this."
Steve Kruger, also a FTPA Executive Committee member added: "We certainly want to treat the Town's employees fairly, but we also want to treat the taxpayers fairly. The results of this study indicate that we've been overly generous to the Town's employees, and when you look at total compensation, including health insurance benefits, I think you'll find that our generosity has been clearly overdone. Its time for the pendulum to swing back the other way."
The full text of the study may be found on the FTPA website at www.framinghamtpa.org by clicking on the link next to the flashing "NEW" on the home page.
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FTPA Releases Study of Employee Salary and Wage Increases
News from: FRAMINGHAM TAXPAYERS ASSOCIATION Contact: Steve Kruger (508) 788-1777 *For immediate Release* FTPA Releases Study of Employee Salary and Wage Increases Study reveals that general pay increases have far exceeded the increase in cost of living for the past twenty years and points to the need for stricter adherence to existing policies. FRAMINGHAM, MA - February 9, 2004 - The Framingham Taxpayers Association has released a study of general salary and wage increases granted by the Town of Framingham to its employees. The study analyzes the history of general salary and wage increases since July 1, 1981 - the date that Proposition 2 1/2 went into effect. The summary presented in the study states that: "In granting general salary and wage increases since Proposition 2 1/2 went into effect, the Town appears to have placed undue emphasis on how much money happened to be available, and insufficient emphasis on how much was justified by actual changes in the cost of living and what was sustainable given the up and down nature of our economy. Since Proposition 2 1/2 went into effect, the general increases in salaries and wages (often referred to as cost of living adjustments, or COLA's) granted to our employees have exceeded the increase in the Consumer Price Index (CPI) by more than 14 percentage points on a cumulative basis. The cumulative dollar value of the amount by which COLA's have exceeded the increase in the CPI since 1981 is on the order of tens of millions of dollars. The Town has policies in place that, if used effectively, should allow us to manage general salary and wage increases more carefully. However, these policies have not been utilized effectively, a situation which must be corrected quickly." In commenting on the study findings, Enzo Rotatori, a member of the FTPA Executive Committee, stated "Many people have criticized Proposition 2 1/2 for causing a decline in our ability to pay for municipal services. This study clearly dispels that criticism as a myth. Not only have pay increases exceeded 2 1/2% per year, they've exceeded the rate of inflation -which has been higher than 2 1/2% per year. Despite Proposition 2 1/2 limits our spending has been continuing to rise at an alarming rate, and this study highlights one of the key reasons for this." Steve Kruger, also a FTPA Executive Committee member added: "We certainly want to treat the Town's employees fairly, but we also want to treat the taxpayers fairly. The results of this study indicate that we've been overly generous to the Town's employees, and when you look at total compensation, including health insurance benefits, I think you'll find that our generosity has been clearly overdone. Its time for the pendulum to swing back the other way." The full text of the study may be found on the FTPA website at www.framinghamtpa.org by clicking on the link next to the flashing "NEW" on the home page. ###

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Citizens for Limited Taxation