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CPI 8v ECI � For purposes of establishing non-union cost-of-living-adjustments, the Council adopted a policy of T utilizing the local Consumer Price Index (CPI) and the Employment Cost Index (ECI) as a guideline. �: During the 12-month period ending June 30, 2015 the local CPI index was -1.0% while the ECI was �� 1.9%. � The large disparity between the two stems from the fact that the indices are designed to measure two � entirely different things. The CPI measures the change in price for a market basket of consumer goods �� and services including oil (gas) and energy-related costs. The negative CPI is largely driven by a 55% � drop in the price of crude oil over the past year, which more than offset increases in housing, �� transportation, medical, clothing, food, and other goods and services. Excluding oil and energy related � costs, the CPI would have been 1.8%. �� In contrast, the ECI measures the change in the cost of labor to employers — in other words, what � employers are paying now compared to the previous year. In our case we use the ECI-Wages for State � & Local Governments index, which again has increased by 1.9%. � The City Manager Recommended Budget includes an across-the-board COLA of 2.0°/o for all � employees. However, it should be noted that many collective bargaining units in peer cities have already settled for more than 2.0% in 2016. The City generally strives to keep union and non-union �� COLA's commensurate with each other to ensure compliance with federal and state pay-equity laws, �� and to uphold a consistent compensation and benefit package. � � 2016 Preliminary Bud�et & T� Levy T� � The 2016 Recommended Budget (as adjusted) is $52,112,620, an increase of $67,330 or 0.1% overall. � This is a reduction of $335,000 from the preliminary budget adopted on 9/14/15, reflecting changes in � planned capital spending. The Budget for the tax-su�ported programs including capital is $28,745,490, � an increase of $690,150 or 2.5%. This does not however translate into a corresponding increase in the T: �� levy as many of these additional costs are funded by non-levy dollars. The Recommended Budget includes funding for several new positions, however the impact on the tax �� levy is only $5,000. The remainder is funding by fees or other funding sources including a significant � amount of non-local funding. The new positions include: 0 Asst. Fire Chief - cost offset by departmental reorganization PT Park Building Scheduler - tax levy Finance Department Intern(s) - water & sewer fees Passport Supervisor - passport agent fees Auto Dealer License Specialist - vehicle title transfer fees Network Operations Supervisor - partnering agencies & tower rental fees Server Support Specialist - partnering agencies & tower rental fees Computer Support Specialist - partnering agencies & tower rental fees I� The 2016 Recommended Tax Levy required to fund the Budget is $18,944,720, an increase of $667,818 T� or 3.65°/o. The impact on residents will vary depending on the property's value and change in value �=�� relative to other properties in the city. The estimated impact for a typical single-family home that � experiences an expected 0.0% increase in value is shown below. � �� Page 6 of 7