All 10,000 Henrico County employees, including teachers, will see a bump in their paychecks this year — a minimum salary increase of 4.4% rising to nearly 18%.
Under a proposal County Manager John Vithoulkas presented to the county’s Board of Supervisors on Tuesday, a $25 million commitment to wage increases made in December would more than double, to nearly $55 million, in a spending plan to be released next month.
Vithoulkas called the pay increases “generational” in an interview, noting during the meeting on Tuesday that the county hasn’t had a minimum 4% salary increase in about a decade. Board members voiced support for the plan.
“This is the most exciting thing for me that we have done in my 10 years on the board. Our employees are Henrico County. They are the voices, hands and the feet of who we are. We cut $100 million last year not knowing what the future held. ... We turned a negative into a positive,” Supervisor Tyrone Nelson said in an interview.
Supervisors in 2018 tasked Vithoulkas with reviewing salary compression countywide on a three-year cycle, making 2021 “the normal year” to conduct a comprehensive salary review. The review began last November.
After axing $100 million from the current budget when the pandemic hit — including scrapping a planned 3% raise for all employees — the county finds itself with a projected $80 million surplus. Budget cuts were low enough to sustain services without needing additional reductions, and revenues outperformed expectations in real property, personal property, business license and local sales taxes.
The $80 million represents an anticipated excess in revenues for the current fiscal year, which ends June 30.
“By taking the drastic cuts that we did and having our revenue streams remain stronger than anticipated, we created this bucket of capacity, of current dollars, current revenues and recurring money,” said Meghan Coates, the county’s finance director, in an interview.
Among other moves, the county last year cut $22.7 million in new capital projects, eliminated the 3% countywide salary increase and implemented a 5% across-the-board reduction in operating expenses, generating about $9.1 million in savings.
The pay increases come in two waves for most employees and three for longtimers. In April, all employees will receive a 2% raise and a pay increase based on market rates. County employees who have 10 years or more of service will receive additional longevity increases in October. The longevity increase varies from a 10-year employee to a 15-year employee and so on.
The second April pay increases are for county teachers, police officers, firefighters, sheriff’s deputies and employees who are required to have a commercial driver’s license.
All teachers, regardless of their year with the county, will receive a minimum salary increase of 6.9%, with 38% of teachers receiving a longevity pay increase.
The county’s current staffing levels, despite nearly 450 intentional vacancies due to the pandemic, resemble the early 1980s, Vithoulkas said.
As the county moves forward, most of the vacant positions will be filled, Coates said. No county positions are being eliminated to implement the salary proposal.
“I get the staff members will be happy, they should be happy. This is a big deal, but our residents should be happy, too. And here’s why: We are paying for this with the existing balanced budget money ... without affecting our tax structure to our residents,” said board Chairman Dan Schmitt.
The county’s real estate tax rate has remained unchanged at 87 cents per $100 of assessed value for the past 42 years. In that time, the assessed value of homes has risen, meaning that taxpayers ultimately pay more.
According to county officials, the assessment on the average Henrico home rose 4.7% year-over-year in 2021, to $290,600 from $276,800. That boost would come with a corresponding increase of $120 on an annual real estate tax bill.
The county’s “ultra-conservative” budget process last year ultimately paved the way for the proposed increases, Schmitt said.
In the past 10 months, a lot was asked of county staff including loss of a promised raise; virtual school learning; librarians having to staff call centers; and firefighters, police officers and deputies needing to sanitize their vehicles after calls, he continued.
The proposal also seeks to increase minimum salaries for full-time hourly employees to $15 an hour by June 2022, with an increase to $12.50 or $13 in the first year. Jobs that fall into this category include some parks and recreation employees, custodians and aides in human services.