Rangeley budget committee debates which inflation index should set employee pay increases

The Rangeley Budget Committee debated how to set cost-of-living adjustments for nonunion town employees at its Feb. 26 meeting, weighing a broader consumer index against the Social Security metric many residents receive.

Jim Higgins, a budget committee member, summarized research showing the Bureau of Labor Statistics’ Consumer Price Index for All Urban Consumers (CPI-U) covers a wider population and can respond more quickly to price changes than the CPI-W used to calculate Social Security COLA. "If it's a cost of living adjustment, then it would fall under the CPIU," Higgins said.

Austin, another committee member, argued the town should use CPI-W because "we are municipally funded entirely by taxpayers" and many residents live on fixed incomes tied to Social Security adjustments. "Adopting a higher index would effectively require taxpayers to absorb the increases that may outpace their own cost of living adjustments," Austin said.

Chair of the committee framed the discussion with local context, noting the town's median age (56.5) and median household income ($56,007.23) and saying the committee must steward taxpayer funds carefully.

As an alternative to percentage-based COLAs, the chair described a flat-dollar approach some neighboring towns used: calculate the raise amount for the lowest-paid full-time nonunion employee and give that same dollar increase to every eligible employee. Based on numbers in the packet, the chair calculated that a 3.1% increase applied to the deputy town clerk (identified as the lowest-paid full-time nonunion position) would equal an $0.83 hourly raise, or $1,735.16 annually per affected employee.

Members expressed differing views: some preferred the flat-dollar idea as more equitable for lower-paid staff, while others said it would not reflect differing cost pressures across wage tiers. Mark moved to adopt the flat-dollar approach tied to the lowest-paid nonunion employee; after discussion and abstentions for conflicts, that motion failed by tie. Jim Higgins later moved to adopt a 3% COLA; members continued the discussion and agreed to return compensation as a dedicated agenda item next week to allow more data and deliberation.

The committee did not adopt a final COLA formula during the session; members asked staff for additional numbers and to place compensation back on next Thursday’s agenda.