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For the second year in a row, I am pleased to provide pay raises for full-time civilian employees. We’ve set aside $1.9 million during the final three months of FY ’06 so employees whose most recent Employee Performance Evaluation rating was 3.00 or better will receive a 1.5 percent pay raise.

There’s more. I’m proposing City Council set aside an extra $10.4 million, or 2 percent, of the FY ’07 budget to be allocated for payroll. In June, each department will submit a plan for how that money would be allocated. It could include performance-based pay raises or some across-the-board pay increases for defined job categories. Part-time employees, while not eligible for the 1.5 percent general increase, may be included in this plan.

After an exhaustive proposal process, the Human Resources Department secured new contracts for health plans, dental plans and other services. We’re introducing a Healthcare Flexible Spending Account, into which you can contribute up to $1,000 on a pretax basis. You can use that money to reimburse yourself for your copayments, or your over-the-counter medicines, or any of many other eligible expenses. Because the money comes out of your paycheck before taxes, the HFSA saves you money on the things you’ll need to buy anyway.

These new contracts, which offer the same great benefits, will cost you a little more each month: For an employee with a family, the monthly contribution for the HMO will increase $13.28 this year. With the April pay raise, a civilian employee making $25,000 a year will see an increase of $31.25 per month. You still come out ahead, and with great benefits to boot.

We fought hard to keep your premiums low. HMO contributions increased 8.8 percent across all tiers May 1. According to a study by Employee Benefits Solutions and the Houston Business Group on Health, benefits premiums in the Houston area increased 12.2 percent in 2005. And health care costs continue to increase.

I know you work hard. Rest assured, here in City Hall and in the HR Department, we’re working hard for you.

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