The Seward City Council on Nov. 25 unanimously approved raises for city employees and for the second time rejected an increase to its bed tax during the second of three public hearings on its budget.

A resolution that would accept a classification and compensation study resulting in an average 8% increase in personnel costs was postponed during a previous meeting of the council on Nov. 12. Per a memo by City Manager Kat Sorensen, attached to the resolution, the move would add an expense of $757,685 newly spent for Seward’s 73 full-time employees in the budget for fiscal years 2025 and 2026.

An agenda statement included with the resolution says that Seward’s pay scale “is not competitive with other municipalities across nearly all departments, especially in Public Safety and the Finance Department.”

The resolution would give Seward employees an average 8% wage increase, followed by an annual 1.5% cost of living adjustment. That change, the statement says, would make Seward a “competitive community in the hiring landscape of Alaska.”

Postponement came after the council defeated an ordinance in a 4-3 vote to double the city’s bed tax from 4% to 8%. Seward’s draft budget was calculated with that increased revenue in mind, and Sorensen asked the council to postpone action on the wage increase until her office could ensure the city’s ability to afford the raises without “stretching ourself to any limits.” The council directed her to revise the forecasted revenue from sales tax to more closely match actual revenue from 2023, increasing that projection in the budget.

“This does still leave us with a balanced budget that covers the wage study expenses,” Sorensen said on Nov. 25. “We didn’t have to cut any of the things within the budget to accomplish this.”

On Nov. 18, a message posted online by the Seward City Clerk’s office said that Vice Mayor John Osenga had reconsidered his vote against introduction of the bed tax ordinance — but on Nov. 25 neither Osenga or any other member of the council moved to bring the ordinance back up. The budget amendment that balanced the budget without the bed tax increase was substituted unanimously.

The council also adopted the resolution to adopt the study and wage increase unanimously — to applause in the council chambers. The council adopted the resolution without any discussion.

“I requested that you postpone this so that we could ensure that we provided a balanced budget that still funded these increases,” Sorensen said. “Administration and finance did that, so we are presenting this to you again with that new funding — still excited to see this pass.”

Several Seward employees spoke during the meeting in favor of the increase.

Patrick Messmer, a Seward police sergeant, said that low wages and high costs of living have caused staffing shortages at Seward Police Department. He said he’s retiring in April after 18 years in Seward and worries whether the department will be able to hire to replace himself and others.

“Last year, approximately one-third of my gross pay was in overtime,” he said. “This is not by choice. It’s to cover shifts. It’s to be called in for emergencies.”

Josh Ballard said that, including him, all of the regular full-time officers in Seward — not including the chief, deputy chief and sergeant — have looked for “other, higher paying jobs.”

Eva Ballard, a Seward police dispatcher, said that Seward’s employees “make this community worth visiting.” That’s public works keeping roads plowed, parks and recreation keeping people busy, police who keep the community safe despite burn out.

“This raise will provide competitive pay and help balance out the cost of living in hopes of attracting and retaining more people to the city,” she said.

The third and final public hearing on Seward’s budget will be held on Dec. 16 in the Seward City Council Chambers at 7 p.m.

Full recordings of Seward City Council meetings can be found at “City of Seward” on YouTube. The text of the budget document and other legislation can be found at cityofseward.us.

Reach reporter Jake Dye at jacob.dye@peninsulaclarion.com.