Wilmington manager proposes living-wage plan, ties it to 5.75¢ tax increase to shore up police, fire and capital projects

WILMINGTON — City Manager Becky Hog urged the City Council on May 15 to consider a FY27 budget that would raise pay for many municipal workers and shore up public safety, while acknowledging the price tag would require a proposed 5.75¢ city tax increase. Hog told the council the living-wage package is targeted to bring low-paid employees closer to 60% of area median income and that full implementation would be roughly $14.2 million — equal to about 4.01¢ on the municipal tax rate.

The proposal includes a set of pay adjustments across job titles and a $15,000-per-employee cap on individual raises, designed to reduce “pay compression” — the risk that giving larger raises at the low end could push those employees’ pay above supervisors’. “We are proposing right now a cap of no more than $15,000 regardless of your pay,” Hog said in the session.

Why it matters: The budget packet ties the living-wage proposal to a broader push to stabilize public-safety staffing. Council members and staff said a large share of the proposed tax increase would fund police and fire starting pay and benefits, mandatory retirement and health-insurance cost increases, and two full-time IT positions dedicated to public-safety systems.

What staff modeled: Hog showed phased options for the living-wage plan. A 75% implementation in FY27 would lower the first-year tax impact to about 3¢, while a 50% approach would reduce the FY27 hit to roughly 2¢ and push the remainder into FY28. Staff also presented sample household impacts for median and common property values — for example, the council packet estimated the Wilmington portion of the tax bill for a $445,000 home would increase by about $21 per month under the full 5.75¢ proposal.

Council queries and analysis requests: Multiple council members pressed staff for analysis of alternative caps and transitional approaches. Council Member Santaita asked staff to examine the effect of lowering the $15,000 cap to $12,000; staff said they were already running scenarios and would supply a detailed breakdown of how many positions would be affected and where exceptions might be required. Mayor Prom and others also asked for the pay comparisons used to benchmark police and fire starting wages to neighboring jurisdictions.

Public-safety context: Police and fire leaders and staff supplied additional context during the session. Chief Thomas Zuda (WPD) and the city manager emphasized the city’s higher calls-for-service load compared with peer jurisdictions, and noted vacancies — staff reported roughly 41 police vacancies and 12 fire vacancies at the time of the session — that complicate response capacity. Hog said the recommended FY27 package includes targeted investments intended to improve recruitment and retention, including proposed starting-pay increases and benefit adjustments.

Budget trade-offs and next steps: Council members repeatedly framed the decision as a trade-off between higher pay for public employees and the tax burden on property owners, asking staff which elements could be staged or reduced. Hog said staff had sought to pare the proposal from earlier versions and that the recommended package reflects a balance of employee compensation, public-safety needs and capital-project funding. She said staff would return with supplemental analyses — including the requested $12,000-cap scenario and more precise market comparisons — before council votes on final numbers.

The council’s budget schedule calls for additional work sessions and a formal vote on the tax rate and budget later this spring; staff said the living-wage proposals, benefit changes and related pay updates will be reflected in the final FY27 ordinances and implementation schedules if approved.