The Laguna Beach City Council rejected a salary increase for its members and city commissioners on Tuesday, citing continued economic uncertainty prompted by the pandemic.
An agenda item on whether to give councilmembers raises included an option to bump their monthly compensation to nearly $1,000.
“I think it’s frankly not worth the grief that that would undoubtedly arise for increasing councilmembers’ [compensation],” Mayor Bob Whalen said. “I do think we need to set an example at the top in terms of this. We don’t know where we’re going to be headed with our various labor negotiations.”
Councilmembers currently earn $908 per month and haven’t seen an increase in their pay since July 2018, according to a staff report. The City Council must wait for at least two years before it can revisit raises for its members.
The proposed options included increasing compensation based on the increase in the Consumer Price Index over the last two years, which is 5%; match the raises for city employees over the last two years, which is 2.5%; increase it by 10%, which is the maximum allowed per state law; or offer no increase.
Under state law, any raises wouldn’t have taken effect until Dec. 8—the state date of new terms for councilmembers who are elected in the November election.
The City Council also put off a decision on similar hikes to the compensation for the Planning Commission, Design Review Board, and Arts Commission. Whalen pointed out that it can revisit compensation for these volunteers at any time.
Planning commissioners and design review board members currently make $392 per month. Art commissioners earn $137 per month.
If councilmembers go with the most generous raises for themselves and commissioners, the annual cost to taxpayers would be as much as $11,800, according to the staff report.
Councilmember Toni Iseman said that the proposed raises were a symbolic gesture for the time spent by councilmembers and commissioners. But she agreed to reject spending the additional $11,000 per year if it would make people feel bad about what the council is doing.
“It’s 35 to 40 hours at least every week if you factor in the emails, phone calls, and meetings, and so forth, but we are volunteers it’s true,” she said.
Tuesday’s discussion on council pay raises for Laguna Beach’s elected and appointed officials provided an off-ramp at a politically sensitive time.
Whalen and Mayor Pro Tem Steve Dicterow are in the middle of reelection bids.
The Orange County Registrar of Voters reported a 451% increase over 2016 in the number of mail-in ballots already ready returned by Oct. 10 at this same period in the election. It’s unclear whether Laguna Beach councilmembers’ decision on whether to raise their own compensation—with less than a month before the election—would have changed the minds’ of voters who already completed their ballot.
In September, Laguna Beach reported that revenues were down $7.4 million across all city funds compared to what had been anticipated for March to June 30. This is a better result than the $12 million budget shortfall the City Council planned for back in April.
However, the city’s financial planning is based on many Laguna Beach hotels making good on the local transient occupancy tax deferral program, which delayed collection until Nov. 1 because of the pandemic’s strain on the hospitality industry. City staffers are expecting about $1 million to arrive by this deadline.
To prepare for a steep decrease in anticipated hotel and sales revenues, city employee unions and managers forfeited 2.5% raises they were promised to help Laguna Beach weather the pandemic’s economic fallout.
“The uncertainty surrounding the spread of the coronavirus as businesses and schools reopen, the flu season, a potential vaccine, recession, and pre-coronavirus pressures on retail make the remainder of this final year nearly impossible to predict,” wrote Gavin Curran, director of administrative services.
Councilmember Peter Blake said the discussion on councilmember pay raises was poorly-timed considering city employees agreed to forgo their raises this year.
“I think it’s humiliating to offer me 5%,” Blake said. “If you really want to offer me compensation, anything under $200,000 for this nightmare job is unacceptable.”
