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Knoxville Mayor Indya Kincannon announced Friday she’s including requests for better pay for city employees, including a $15 an hour minimum wage and a 6% across the board raise. How the city will pay for it, though, hasn’t been decided.

She made the announcement outside of the downtown fire station, surrounded by firefighters, police officers and city workers as snow flurries fell. The raises will be a part of this spring’s annual budget request, which must be approved by the city council.

The push comes as the city’s COVID-19 financial fears have evaporated. A new compensation study found city salaries, on the whole, are 10% below the market rate.

This has made it difficult to recruit and retain employees, especially first responders, Kincannon said.

“During the pandemic, we saw the cracks of a staffing shortage emerge,” Kincannon said. “Now, amidst an increasingly competitive labor market, we’ve reached a breaking point. We have nearly 150 vacancies at the city, and that’s translating into longer response times and fewer hands to do the critical work of protecting public health and safety.” 

In all, she proposed the following:

  • $15 an hour minimum wage for city employees. Kincannon called it joining the “$15 club,” which many major private employers have touted in recent years. 
  • A one-time 6% across-the-board salary increase for all employees, up from the typical 2.5% annual raise. 
  • Adjustments to salary ranges across city department to better match market comparisons and address compression. This would, as an example, reconfigure salaries for employees who have been in a position but haven’t been given a promotion from someone who has just began the same position.
  • Implementation of a step pay plan for Knoxville Police and Knoxville Fire Departments, allowing uniformed employees to advance each year throughout their careers. The system would likely mirror the county’s and would reward employees for their longevity and potentially provide different salary levels within a singular job title. 
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    Both Police Chief Eve Thomas and Fire Chief Stan Sharp said the increases will help, with Sharp saying it costs roughly $40,000 to fully train a new firefighter so being able to retain more will help in the long term.

    “This compensation fix can’t come quickly enough,” Thomas said in a news release. “We’re 42 officers short of full strength, and our officers are being stretched thin. We know that we are losing officers to other cities or career opportunities that pay better, far too often. Our officers deserve better and so do the people of Knoxville.”

    Budget crunch coming

    Last week at the city’s budget retreat, Susan Gennoe, the city’s chief financial officer, said the compensation survey would likely show the city needed to make up some $9 million to $13 million in salary fixes. On Friday, Kincannon said that estimate is the best guess the city has to work with, though they’ll know more when they begin the budgeting process this spring.

    Last week, Gennoe said next year’s budget — fiscal year 2023 — was the “cautionary year” where the city’s fund balance, or rainy-day fund, shrinks to nothing.

    Knoxville Police Chief Eve Thomas announces her retirement during a press conference at the City-County Building in downtown Knoxville, Tenn. on Friday, Nov. 12, 2021. Chief Thomas joined the police force in 1993 and served in various leadership roles before being named Chief in 2018.

    So, Kincannon has a decision to make. This year or next she likely will have to cut services, propose a property tax increase or plan out a mixture of both to keep the city in good financial shape.

    For her part, Kincannon said all possibilities are under consideration.

    “We’re weighing all the options, and (a property tax increase) is one of them,” she told Knox News after the press conference. “We need to make sure we keep high-quality services for the people in Knoxville.

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    “More people want to live here and move here and have their businesses here and that requires services and services require people,” she continued. “And people need to be paid fairly, or else they go to other jobs.”

    Kincannon will outline her plan and present the full findings of the compensation study during a city council workshop planned for March 3. If approved by council members during the budgeting process, these changes would take effect July 1.

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