President Carter's 7.05 per cent by boost for U.S. workers, last week will place the federal government in an fair competitive position with many local municipalities, by increasing the gap between federal and local government employee salaries, some local officials say.
These officials point to figures such as those published in the latest U.S. Department of Commerce survey that show federal employees already enjoy a sizable advantage. They recive an average of about $16,000 a year while state and local government employees received an average of about $11,500 annually.
Some officials of local governments say they cannot continue to compete with escalating federal employee wages. They say these salary increases cripple localgovernment employees received an average of about $11,500 annually.
Some officials of local governments say they cannot continue to compete with escalating federal salary increases cripple local governments by forcing them to pay premium prices for highly skilled employees who would otherwise be lured away by the attraction of higher federal salaries.
These officials say they are also hampered because local government employee unions are citing federal wage increases as one of the bases for their demands for cost of living increases.
"It's catastrophic" said Montgomery County Executive James Gleason. The federal government has become the "pace leader" in employee salaries and has "put tremendous pressure on local governments with limited resources," he said.
Gleason said each pay increase for federal employees creates "an entire new level of anticipation" for local employees.
According to Gleason, Montgomery County is strapped to a budget that expands only as property taxes rise or other taxes increase. He said that as a result the Montgomery County government cannot afford to compete in the same job pool with the federal government.
If Montgomery County government employees were to receive the same 7.05 per cent cost of living increase that President Carter has approved, it would cost the taxpayers in that county $6.5 million, according to William Treworgy, the county's deputy director of budget. If teachers were included in that pay raise, it would cost the county $21 million, he said.
Washington, by law, has to add federal employe pay increase to the pay scales of most of its government employees. So, according to officials, eral employee increases came as no surprise.
What did come as a surprise, according to the District budget director, Comer Coppie, was that the increase was 7.05 per cent rather than the 5 per cent that the District had budgeted.
To make things worse, last week the District Council added firefighters, policemen and teachers to the list of those who will also receive a pay with federal government employees.
Coppie said the District will have to "reprogram funds, absorb costs and request supplemental appropriation from Congress" to make up the deficit. The raise will cost the District approximately $12 million more than the 5 per cent increase already budgeted for District employees - plus an additional $10.5 million in salary increases needed for policemen, firemen and teachers.
"We don't say we have problems anymore in District government, . . . just 'challenges ahead,'" said Coppie.
Prince George's County Executive Winfield M. Kelly Jr. found reason to be "pleased" with the federal pay raise, scheduled to go into effect next Saturday.
He said the new pay raise will provide an additional $75.9 million in annual income to Prince George's County residents because one of every five are federal governments employees. The county has already negotiatiated a two-year contract with county government employees.
Prince George's County school board member Maureen K. Steinecke was quick to point out, however, that the county's 8,000 public school teachers will soon negotiate their contract, which expires this year, and they "can't help but notice the federal employee pay raise."
Spokeman for the county teachers union agreed that the teachers would be using the federal employee cost of living increase as "one of the factors" to set their wage demands.
In virginia, county and city officials are less concerned about the impact of federal wage increases because the Virginia Supreme Court ruled this year that all contracts made through collective bargaining are no longer binding.
Fairfax County Executive John F. Herrity said that roughly 25 per cent of his county's population is made up of federal employees. "I'm certainly not going to go against the (federal) raise . . . I don't want to go on record opposing that federal employee increase," he said. "In fact, I favor it."
He said federal pay increases only "indirectly" create a push by local government employees to request pay raises.
Francis B. Francois, a Prince George's County councilman and a spokesman for the National Association of Counties, said it is difficult to assess the impact of federal employee wage increases on local governments, because it varies regionally and by job title.
Francois said, however, that in an area like Washington, where both federal and local governments selection is particularly intense.
He said the competition is probably among those employees with skills that can be transferred to both local and federal government.
A spokesman for the U.S. Department of Commerce's Bureau of Eccnomic Analysis said there has been no study done on the impact of the federal wage increases on local government salaries.
Throughout the Washington metropolitan area, realtors have expressed doubts about the impcact of the federal wage increase on their market. One realtor said: "The 7 per cent increase will just be swallowed up by risks property tax rates throughout [WORD ILLEGIBLE] area."