Chattanooga City Councilman Russell Gilbert / Staff file photo

The Chattanooga City Council gave initial approval to a series of budget amendments on Tuesday, resurfacing a debate about employee pay.

Council members took the first of two required votes on four amendments to the budget for the fiscal year that started July 1.

They unanimously approved a $1.5 million capital grant for a local partnership providing internet to low-income students and more routine amendments to accept more than $500,000 in federal transportation funding and appropriately $150,000 in capital funds leftover from last year for the Southeast Tennessee Development District.

The group approved the fourth amendment, to undo $1.5 million in erroneously budgeted pay increases, 8-1, prompting debate about when and how the city will address employee pay.

Councilman Russell Gilbert, who had asked for the amendments to be voted on individually instead of as a group, dissented, saying that taking away the accidentally allocated raises was regressive in a city that needs higher wages.

Councilwoman Demetrus Coonrod responded by clarifying for the public that the one page of the operational budget mistakenly included in the original ordinance does not provide raises for all employees and was not the solution to the city's wage concerns.

"I just want to make sure that our constituents that are on the line with us are not misinterpreting what Russell has said ... because what he's talking about is separate," Coonrod said, explaining that the council was not voting against proposed raises.

"It was just a draft, it wasn't something that was going to be implemented, the draft was being worked on. And so we got to make sure that we're giving the right information to our constituents," she said. "Do I agree that our employees need to have raises? Yes, absolutely. We need to, but at this point, COVID made life different for everybody."

(READ MORE: Before COVID-19, Chattanooga was set to increase minimum wage to $15 to match market)

During the "other business" portion of the meeting, Coonrod said she was already getting texts and comments from constituents who mistakenly believed the council had taken a vote against general employee raises and asked a member of the city's finance team to address the action taken.

"What we have approved tonight does what we told you we would present in this year's budget, which is that there would be no raises for anyone in the city this year because of our impaired revenue due to COVID," Chief Operations Officer Maura Sullivan said, noting that the erroneous raises were inconsistent across departments and pay grades and were the result of a clerical error.

(READ MORE: Chattanooga mayor's budget includes 221 vacancies, pay freeze to offset $8 million in lost revenue from COVID-19)

Sullivan said that the document accidentally approved only had raises for about 500 of the city's employees, and had inconsistent pay increases from 2% to 15% and can't be funded out of the operational budget, as it is imbalanced.

"Unfortunately, we cannot use any reserve funds from a previous year or any that are accumulated in a reserve fund to help add to a salary line," Sullivan said. "It's just not prudent to do, because you are not guaranteed to have that revenue the following year."

Sullivan said the version of the budget with no additional raises is the best way for the city to make sure the budget was balanced and all employees stay employed during the tight fiscal year.

Gilbert — who has been advocating for raises before and after the budget, citing a compensation study that showed the need for significant pay increases for many city employees — still pushed to see how it could have provided raises for employees.

"If we did not remove page 69, that means that we could have gave raises to everyone?" he asked.

"No sir," Sullivan explained, noting again the number of affected employees.

"But 500 people could have got a raise," he added.

As Gilbert and Sullivan debated the amendment, Councilman Jerry Mitchell called a point of order, with the chairman intervening and ending the discussion.

The council will take the budget amendments up for a second and final vote on Sept. 29.

Contact Sarah Grace Taylor at or 423-757-6416. Follow her on Twitter @_sarahgtaylor.

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City Councilwoman Demetrus Coonrod speaks during a meeting in the Chattanooga City Council chamber on Tuesday, May 14, 2019, in Chattanooga, Tenn. / Staff file photo