Morrow City Councilman Bob Huie implores his colleagues to approve about $22,200 in Christmas bonuses for city employees despite a more than $700,000 budget deficit facing the city Tuesday. (Staff Photo: Curt Yeomans)
MORROW — Despite facing a budget deficit of about $744,000 this year, the Morrow City Council voted unanimously this week to hand out $22,200 in Christmas bonuses to employees.
The bonuses were requested by council members Jeanell Bridges, Bob Huie and Virlyn Slaton, and will be paid to 99 full-time employees and 24 part-time workers. Huie told his colleagues the full-time employees would be paid $200 while the part-time workers would get $100.
The vote came after Finance Director Dan Defnall told council members the city was facing the possibility of a second consecutive budget year with a deficit. He said there was a $500,000 deficit during the previous fiscal year, which ended in October. The city did, however, just receive nearly $400,000 from the sale of property it owned.
Despite that report, some council members said employees deserved special compensation for working for the city.
“Of course we’re in debt but I still feel strongly about our employees who continue to work hard and have not received a raise in four years, but have not complained and continued to do their jobs and do it well,” said Bridges. “We just sold property and unexpected funds have come in and I don’t see how 4 or 5 percent of that would hurt the city.
“Our debt will not go away, but I don’t think we should hold our employees hostage to debts that were created by someone else … I do not understand why we cannot show our appreciation to the employees of this city,” Bridges added.
With the prospect of a budget shortfall, the city will have to turn to its general fund reserves to cover the cost of the bonuses, said Defnall. He explained the city has $2.1 million in reserves.
“We’re not in dire straits,” he said.
The city has spent the last few years trying to rebuild its reserves. A few years ago, Defnall said, the reserve balance was about $500,000. That was at a time when the city was trying to work its way past millions of dollars in losses on its failed Olde Towne Morrow development.
Although Olde Towne Morrow has been closed for three years, city leaders have still not decided what it will become and it continues to be a drain on the town’s financial resources.
The city took a further hit this year when it projected a $1 million drop in court revenues, which officials have said is due to the end of road construction work at the interchange of Ga. 54 and I-75. To make up the shortfall, the city raised its property tax rate by 2 mills this year to avoid laying off employees whose salaries and benefits are Morrow’s biggest expense.
“We don’t have any money and it’s hard to pay your bills when you don’t have any money,” said Mayor J.B. Burke.
Defnall said the city also has a $6 million balloon bond payment due in 2017. All of this means the city has to find new revenue sources to continue operations. Otherwise, employees could someday be receiving pink slips instead of Christmas bonuses.
“We’ve got some money in reserves but with the continuing decline of revenue sources and with most of our expenditures [being] employees, at some point the only way we can balance that is to start laying off employees,” said Defnall.
It’s not clear how much support exists for the bonuses, though. When the council approved it, about six residents — out of a crowd of roughly 30 employees and residents in the audience — applauded the move.
The decision to grant the bonuses did not come without some consternation on the part of city leaders. Burke publicly wrestled with the issue of the projected deficit versus showing appreciation for employees. Under the city charter, the mayor can only vote when there is a tie that has to be broken.
“We are seriously in debt, we have a deficit that is over $1.2 million (between the previous and current fiscal years), businesses have left our city, we have no economic development and we haven’t had any for a while,” said Burke. “However, nobody could feel more strongly about the employees of this city than I do.”
In the end, Burke and the council decided they needed to do something for employees. Burke said he wished the city could pay out larger bonuses but he added he would not agree to anything higher than what was presented because of the city’s financial situation.
Huie said the employees deserved a bonus for sticking with the city without receiving raises and that the city should count its blessings.
“We’re fortunate to have the employees that we have in the city and they need some kind of incentive,” said Huie.