AR City Manager contract amenment number five

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ITEM #25 CITY OF COLTON AGENDA REPORT FOR COUNCIL MEETING OF January 17, 2006 TO: HONORABLE MAYOR AND CITY COUNCIL FROM: ANTHONY ARROYO, HUMAN RESOURCES DIRECTOR SUBJECT: FIFTH AMENDMENT TO CITY MANAGER EMPLOYMENT AGREEMENT DATE: January 9, 2006 BACKGROUND: The City Council and City Manager Daryl Parrish originally entered into an employment agreement in June 2001 for management services to be provided by Mr. Parrish as City Manager for City of Colton. The proposed fifth amendment would address the City Manager's base salary, and would document the City's existing practice regarding the City Manager's automobile benefit. DISCUSSION/ANALYSIS: In the original employment agreement, the City Manager's salary amount was set at $120,000 per fiscal year. Although the City Manager's agreement has been amended four previous times since 2001, the City Manager's base salary has not been directly increased since 2001, with adjustments related only to cost of living adjustments provided to the Executive Unit. According to staffs research, the City Manager's current base salary of $136,548 is the lowest city manager salary among the following 13 cities: Loma Linda, Banning, Yucaipa, Chino, San Bernardino, Azusa, Redlands, Moreno Valley, Fontana, Upland, Ontario and Rialto. The base salary proposed in this fifth amendment would place the City Manager ahead of only Loma Linda, Banning and Yucaipa. The proposed fifth amendment to the City Manager's employment agreement would increase the City Manager's salary to $149,436 effective July 1, 2005, $162,324 effective January 1, 2006 and $175,200 effective July 1, 2006. The proposed amendment would include a cost of living adjustment, from two to three percent (2%-3%), which would be effective on July 1 s` of 2006, 2007 and 2008. Please note, however, that the last increase on July 1, 2008 would take effect only if the Council determines to extend the term of the City Manager's agreement, since it is currently set to expire on June 5, 2008. The proposed amendment also requires the City Manager to work with the City Council to develop a pay -for -performance review system, which shall establish clear goals and objectives for the City Manager and which may include the opportunity for one-time bonuses based upon objective criteria. Any additional increases in salary shall be at the sole discretion of the City Council.