3.13 Compensation Study RFP
Request for
City Council Action
DEPARTMENT INFORMATION
ORIGINATING DEPARTMENT REQUESTOR: MEETING DATE:
Human Resources Assistant City Administrator/Human Resources Hille November 28, 2022
PRESENTER(s) REVIEWED BY: ITEM #:
Consent City Administrator/Finance Director Flaherty 3.13 - RFP
STRATEGIC VISION
MEETS: THE CITY OF OTSEGO:
Is a strong organization that is committed to leading the community through innovative
communication.
Has proactively expanded infrastructure to responsibly provide core services.
Is committed to delivery of quality emergency service responsive to community needs and
expectations in a cost-effective manner.
X Is a social community with diverse housing, service options, and employment opportunities.
Is a distinctive, connected community known for its beauty and natural surroundings.
AGENDA ITEM DETAILS
RECOMMENDATION:
City staff is recommending that the City Council authorize advertisement of a Request for Proposals.
ARE YOU SEEKING APPROVAL OF A CONTRACT? IS A PUBLIC HEARING REQUIRED?
No No
BACKGROUND/JUSTIFICATION:
The City Council included budgeted funds in the 2023 budget to conduct a Classification and Compensation
Study. The City last conducted such a study in 2020, with implementation in 2021.
Best practices identify a 5 to 7 years’ timeline for conducting compensation studies; however, the
guidelines for the time frame are adjusted dependent on current market and financial conditions. If the
market is strong or rapidly changing, or if an organization is experiencing recruitment or retention issues,
this time frame moves to 3 to 5 years. Alternately, if there were an economic downturn or poor market
conditions, the timeline extends to 7 to 10 years.
Due to the rapidly changing market, specifically for retention and recruitment, City Staff proposes the study
to be completed within the 3-year timeframe. The goal of City staff is to have this study completed in time
for inclusion within the 2024 budget review process.
The Request for Proposals follows previous studies completed for the City to ensure compliance with
Minnesota’s Pay Equity. Request for Proposals will be due by January 19th. 2023, with the intention to
present a project recommendation to City Council in February 2023.
The Administrative Subcommittee reviewed the proposal at the October 12, 2022, meeting and
recommended the proposal be placed on a future agenda for Council approval.
SUPPORTING DOCUMENTS ATTACHED:
• Request for Proposals
POSSIBLE MOTION
PLEASE WORD MOTION AS YOU WOULD LIKE IT TO APPEAR IN THE MINUTES:
Motion to approve posting and advertisement of Request for Proposals for a 2023 Classification and
Compensation Study.
BUDGET INFORMATION
FUNDING: BUDGETED:
General Fund – Human Resources
101-41800-390
Yes
Request for Proposals
Classification and Compensation Study
Proposals Due By:
January 19, 2023
5:00 p.m.
City of Otsego – Classification and Compensation Study RFP 2
November 29, 2022
Dear Consultant:
Enclosed is the background information necessary to provide a proposal for the classification and
compensation study for the City of Otsego.
The end report must conform to the standards set by the Minnesota Management and Budget
Department (MMB) for pay equity reporting. All proposals must be received by 5:00 PM on
Thursday, January 19, 2023.
Thank you for your consideration. If you have any questions concerning the specifications, etc.
please contact me at 763-235-3162.
Sincerely,
Sabrina Hille
Assistant City Administrator/Human Resources
City of Otsego
City of Otsego – Classification and Compensation Study RFP 3
NOTICE OF PROPOSAL
The City of Otsego is seeking proposal from consultants highly experienced in government
sector compensation studies and compensation plans to evaluate the internal position
relationships and external market comparisons for all positions within the City. Sealed proposals
will be accepted until 5:00 p.m. on Thursday, January 19, 2023 at the Otsego City Hall, 13400
90th St NE, Otsego, MN 55330. Proposals must be labeled “Classification and Compensation
Study Proposal.” Please provide seven (7) copies of the proposal and an emailed digital copy to
shille@ci.otsego.mn.us
CITY OVERVIEW
Otsego is a growing city northwest of the Twin Cities and conveniently located off I-94 and MN-
101, with a population of approximately 21,289.
The City of Otsego currently has in place a job evaluation system The Systematic Analysis and
Factor Evaluation (SAFE) System. SAFE was last reviewed and updated in 2020 for pay equity
compliance. In the 2020 Study work included update of job classifications, external market
study, pay plan review, and review recommendations for compliance with State pay equity laws.
The 2020 study was reviewed and recommendations were implemented in budget year 2021.
The City has approximately 51 employees (32 FT /18 PT) and 28 position classifications subject
to the State of Minnesota Pay Equity Compliance requirements. The City contracts for all police
and fire/emergency services. There are no labor unions.
Non-exempt and exempt positions are paid on a performance-based step program. Our current
compensation program has 23 grades and 9 steps within each grade. Throughout the last several
years we have maintained updated job descriptions and we are currently in compliance with Pay
Equity requirements. Our next Pay Equity Report is due in 2024 for the 2023 plan year.
SCOPE OF WORK
A. The work to be completed includes the following and all work associated with
completing the listed tasks:
• Review the existing job descriptions and physical requirements
• Review the existing job classifications within the existing system to determine job
value for each position with recommendations for necessary adjustments.
• Review our current classification system for appropriate number of grades/steps
based on our current job classifications.
• Review our current classification system and recommend solutions for addressing pay
compression.
• Conduct an external market study using comparable cities (recommend comparable
cities) and provide recommendations for adjustments to the City’s pay plan along
with a method/system to ensure continuing consistency with the market.
City of Otsego – Classification and Compensation Study RFP 4
• Test recommendations to ensure compliance with the State of Minnesota’s State
Equity Compliance requirements.
• Explore and research additional compensation benefits, that is compliant with
Minnesota’s Pay Equity.
B. Establish and provide concrete schedules for each of the above proposed
developments.
C. Present findings and recommendations, including written and oral reports and
policies at various meetings such as employee and City Council meetings.
Option:
If you prefer not to use the existing SAFE, you may recommend another evaluation system that
is approved under the State’s pay equity law. Please include supporting information on the
system you recommend and the cost, if any, to change evaluation systems.
CONSULTANT SUBMITTAL
The proposal shall contain the following information:
A. A transmittal letter with Consultant background.
B. A list of government compensation studies completed in Minnesota in the past two years.
C. A project outline identifying in detail the strategy you will use for completing the project.
D. The name(s) and professional backgrounds of the individuals assigned to this project.
E. The name of the lead consultant/project manager who will be doing the majority of the
work included in this proposal.
F. A meeting outline listing number of meetings included in your proposal and with whom
those meetings would be held.
G. A cost for each additional meeting.
H. A time-line for completion.
I. A not to exceed cost.
J. The cost for Options as listed in the Scope of Work section.
City of Otsego – Classification and Compensation Study RFP 5
CONSULTANT SELECTION
Consultant selection will be determined at the City’s sole discretion based on numerous factors
including, but not limited to the following:
• Consultant qualifications and experience
• Completion of recent similar studies
• Completeness of Request for Proposal submission
• References
• Total Cost
PROJECT COMPLETION
The deadline for completion of this project is June 12, 2023.
OTHER
A. Questions regarding this Request for Proposal should be directed to:
Sabrina Hille
Assistant City Administrator/Human Resources
Telephone: 763-235-3162
Email: shille@ci.otsego.mn.us
B. The City of Otsego reserves the right to accept or reject any and all proposal and to waive
minor and nonmaterial informalities or irregularities in proposals.
C. Seven (7) copies of the proposal are to be submitted by 5:00 p.m. on Thursday,
January 19, 2023.
D. Finalists may be required to make a presentation to our Administrative Sub-Committee
and/or City Council for evaluation.
City of Otsego – Classification and Compensation Study RFP 6
Position
Points Grade
0 - 93 1
94 - 112 2
113 - 131 3
132 - 151 4
152 - 173 5
174 - 197 6
198 - 223 7
224 - 251 8
252 - 281 9
282 - 314 10
315 - 350 11
351 - 389 12
390 - 431 13
432 - 476 14
477 - 521 15
522 - 566 16
567 - 614 17
615 - 662 18
663 - 710 19
711 - 761 20
762 - 812 21
813 - 842 22
843 - 886 23
Position Points Grade
Receptionist / Office Assistant 108 2
Streets Maintenance I 158 5
Parks Maintenance I 167.5 5
Utility Billing 178 6
Administrative Assistant 180 6
Deputy Clerk 183 6
Building Permit Technician 183 6
Finance Assistant 193 6
Utility Operator - Class D 193 6
Recreation Coordinator 198 7
Finance Clerk 198 7
HR Generalist 200 7
Parks & Recreation Operations Coordinator 200.5 7
Utility Operator - Class C 218 7
Streets Maintenance II 220 7
Mechanic 250 8
Utility Operator - Class B 245 8
Lead Parks Maintenance 250 8
Utility Operations Foreperson 262.5 9
Street Operations Foreperson 265 9
Accountant 313 10
City Clerk 317.5 11
Human Resources / Assistant City Administrator 453 14
Parks and Recreation Director 475 14
Street Operations Manager 500 15
Utility Manager 515 15
Finance Director 635 18
City Administrator 775 21