MADISON, Wis. – Madison Mayor Satya Rhodes-Conway is pushing a proposal that could get thousands of city employees some extra cash by early next year.
Rhodes-Conway said thanks to a multi-million dollar surplus, the city can afford to give its full-time and part-time employees, roughly 2,900 people, a one-time payment of $1,000.
“Our city staff have worked very hard during the pandemic and have been asking us all along if there’s some way that we could show some appreciation for that,” she said.
In addition to recognizing employees for their work through the pandemic, the money would serve as a way to help them deal with rising costs due to inflation, Rhodes-Conway added.
The money for her plan would come from an insurance fund city employees themselves pay into. In fact, they contribute roughly 85% of its total value.
City Finance Director David Schmiedicke said the Premium Stabilization Fund’s balance for employee life insurance and disability programs has increased drastically in the last three years.
He said premium revenue exceeding claims have led to an unusual fund surplus of $6.8 million. The mayor is proposing half of those funds be paid directly to employees.
“We are finding a way to return essentially their money back to the employees,” she said.
UW economics and public affairs professor Tim Smeeding said after the worst of the pandemic, state and local governments have been slower to bounce back than the private sector, including with staffing, so the extra cash could do a lot for retention.
“So if it’s hard to attract employees, what do you try and do? You try and keep the ones you’ve got,” he said.
It’s also the sort of response a private sector employer would have to avoid the costs associated with turnover and training someone new, he added.
As for how useful the money will actually be to an employee’s daily life, Smeeding said that depends on the employee.
“If you’re having trouble making rent or you’re working a second job, it may be just great. It may help you get over the hump,” he said. “If you’re a homeowner who has a fixed mortgage, you’re an older worker, it may not have that big of an effect.”
The mayor’s proposal would need approval from the Common Council to move forward. If that happens, after taxes, city employees would each get roughly $650 to $850 by the end of February.
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