The City Council decided in a closed session Tuesday to extend City Manager Russell Allen’s contract by a year and give him about a 5 percent raise.
The increase will bump Allen’s annual salary from $210,000 to $220,000. Allen’s pay has risen 57 percent since he was hired in 2001 at an annual salary of $140,000.
The council voted on the raise after discussing Allen’s job performance behind closed doors, as state law allows.
Mayor Charles Meeker said after the closed session that the council believes that Allen continues to do an outstanding job and is a key reason Raleigh is recognized as one of the best places to live in the country.
Councilor Mary-Ann Badwin said today that the council did consider how Allen's raise would look given the wider economic crisis that is resulting in layoffs and reduced pay in many industries and some government agencies. But she said Allen has done a very good job, and that his salary remains below what other top managers make in cities of similar size to Raleigh. Here are her comments on the raise:
"We did talk about that. What the perception would be. But we also weighed the fact that he has done what we feel is an extremely good job managing our finances and managing the city. Part of the issue is his pay is actually pretty low compared to his peers in other cities of similar size. What we’ve struggled with over the years is trying to get his pay up a little higher. We did look at the fact that we are in an economic crisis, but we felt that we needed to reward him for his efforts and also get his pay up a little more so he gets more in line with other peers. Also, when someone doesn’t get a raise when they work very hard it’s de-motivating."
Allen had one year left on his existing contract.
Although Raleigh has had a hiring freeze in effect since July 1, 2008, the city has not frozen pay or benefits of its employees. City employees are eligible to receive merit raises up to 5 percent each year.
Allen is scheduled to present his proposed 2009-2010 budget to the City Council on May 19. He warned the council in March that Raleigh could face a budget shortfall of $18 million to $22 million next fiscal year in its general fund.
Allen said Thursday that he has reviewed employee pay and other benefits as well as all programs and services offered by the city. But he declined to share his recommendations in those areas until he presents his proposed budget to council.
Allen has already said he will not recommend any increases in the property tax rate, or any increases in the privilege license fee, the stormwater fee or the solid waste fee.
Allen also proposes reducing the number of general fund employees by not filling vacant positions in an attempt to avoid the need for layoffs.
The city will continue to fill police, fire and other critical service positions that become vacant but likely won’t be creating any new positions in those areas next fiscal year.