Cottleville officials initiate steps to work for free

While acknowledging that the city of Cottleville is in good financial shape and has a bright future, the city’s Board of Alderman nonetheless took the first step last week to waiving salaries for the board and the mayor for an undetermined period.

The board introduced a bill in its regular meeting that would allow the mayor and four aldermen to petition the city to forego their annual salaries. Those funds would be returned back to the city.  The waiver and its term would be voluntary with each official determining the amount and term of their participation.

Mayor Don Yarber said the bill was necessary because officials can’t simply return their paychecks to the city because of income tax issues. “We’re W-2 employees. There are tax liabilities now” (to returning the paychecks), he said.

Currently, the mayor’s salary is $12,000 annually. Each of the four aldermen receives $2,400 a year.  If all five officials voluntarily waived their compensation to the city, Cottleville would save $21,600 annually and those funds would remain in the city’s general revenue fund.

City Administrator Scott Lewis — who also serves the city as police chief — said there was no specific plans for how to use the funds instead of paying salaries. However, he said that because they would not be a reliable income source the salaries might be applied to one-time city expenses or projects.

Lewis speculated that some of those expenses or projects might include a fee the city would incur if it applies to Standard & Poor’s for an A credit rating. Park improvements or re-establishing a regular communication program to residents which was discontinued earlier were other possibilities for the funds, he said.

The salary waiver is “totally voluntary on their part,” Lewis said, about the board and mayor’s participation.  Each individual would need to petition the city to waive their salary for a specific period.

The idea for the waiver came up last year as city officials met to discuss the current municipal budget, Lewis said.  With the loss of American Furniture last year and its sales tax revenue city leaders were unsure of the total impact to Cottleville’s income.

“During budget conversations last year we analyzed expenses and income. Someone suggested that they’d be willing to forego their salary to help the bottom line,” Lewis said.

Lewis said Cottleville isn’t in poor financial shape. The possibility of the city seeking an A credit rating is evidence that the financially conservative approach by city officials is succeeding, he said.

And, new business is coming into the city and existing businesses are planning expansions, he said.

In a separate meeting Yarber echoed Lewis’ optimism. “I think our future is bright. Out-lots will fill up. New business will come. American’s (space) will fill up.”

Lewis said, “Cottleville has historically been very conservative. Several years ago we knew we needed to establish a cash reserve—a ‘rainy day’ fund. We did that. Last year, we budgeted a worst-case scenario but sales tax revenue came in higher than expected. We may need to tap into reserves slightly, but we finished 2011 better than expected.”

He said that he believes that the board’s action to waive salaries continues its historical approach to finances. “The mayor and board are very conservative and want to continue to be cautious,” Lewis said.

Ward 1 Alderman Jim Hennessy agreed with Lewis’ comments, “The city of Cottleville has always used a very conservative approach to our city budget, thanks in large part to our city treasurer, Amy Lewis. Even though the city is stable financially, these tough economic times have forced us to be very judicious with our expenses to stay within our budget.”

Hennessy said that “an outsider may see individuals voluntarily giving up pay and think ‘our city is in real financial trouble.’ We understand that with some common sense and some shared pain, our great city will continue to grow and prosper.”

Lewis said that though the idea of city officials giving up their salaries may seem unique, other municipalities have done similar things. He cited Weldon Springs as having some of their officials who forego a salary. That action helped Cottleville. “We copied their ordinance.”

To Mayor Yarber the action by Cottleville officials isn’t at all surprising because he says the city is unique.  “I don’t know what other cities do (financially). But Cottleville isn’t like other cities.”