The following is the second in a series of articles about the Town of Westport’s finances. Written by ex-Board of Finance Chairman Brian Stern, this piece explores the major components of the town’s annual budget.

Westport Journal presents these pieces of news and analysis to help readers better understand town finance: the dynamics that create the town’s revenue, how that revenue is spent, the major drivers of town budget increases and how the town manages capital and infrastructure expenses. We plan to also put the decisions made by the Board of Finance and the Finance Department into the larger context of continuing to secure a safe and predictable long-term future for the town.

By Brian Stern

Last month, we described the Town’s revenue and explained the importance of the townwide revaluation and its impact on residents. This month, we’ll focus on the largest expense – personnel-related costs, which account for 62% of town’s the annual budget. 

The other expenses are: Materials and purchased services (18%), debt service (11%), the Westport Library (6%) and small capital projects (3%). We will discuss each of these elements in future articles in this series.

Town of Westport Finance Director Gary Conrad walked us through some of the main components of personnel expenses. (We have not included the Westport Public Schools in this article; we will explore school finances later this year, after the district’s budget cycle.) Overall, personnel expenses are a function of the number of employees multiplied by their salaries and our pension obligations.

Major town departments

Excluding the library’s 55 employees, the Town employs 297 people. Of those, 149, or 50%, are involved in public safety: the police and fire departments. The public works department maintains the Town’s next largest full-time staff, with 51 employees. That’s 17% of the total.

The remaining employees perform a wide variety of functions that do not require such large staffs, including legal, financial, human services, planning and zoning and general government. The parks and recreation department retains a small, fixed head count with many temporary folks who primarily work from spring to early fall.

Compensation for Town employees is determined primarily by bargaining unit contracts, typically negotiated every three years. But these agreements, which are posted on the Town’s website, include more than employees’ pay. They also include health plans and work protocols. On the Town’s side, they are negotiated by a team led by the administration with support from representatives of the Board of Finance (BOF) and the Representative Town Meeting (RTM).

As the contracts determine almost two thirds of the budget, effective negotiations are vital to the Town’s financial health and efficient operations.

Many years ago, as a BOF member, I witnessed those talks and I can affirm that they were thorough and well argued on both sides. In a few instances, impasses were resolved by mediation or arbitration, but that was rare. 

Police and Fire

For an understanding of compensation, we’ll look at salaries for police officers and fire fighters, whose pay ranges widely by position and time served. While the average police salary, with overtime, is $150,000, the starting officer’s base rate is $75,000. That increases over seven years to $110,000. For sergeants, the range is $125,00 to $130,000.  

Base pay plus overtime and contracted services can be significant. It should be noted that contracted services do not use Town funds. They are paid for the external entities, such as utilities, that require police safety services. In fact, five officers each earned total compensation of more than $250,000 2025, but they worked long hours. 

Firefighters’ shift and coverage pay formulas are complicated by work/coverage requirements, but the annual base compensation starts at $66,000 and rises to $100,000 over seven years. As with the police department, the total compensation can be much greater after overtime and other paid activities. The average compensation for fire fighters including overtime was  $163,000 in 2025.

Pensions

In addition to active employees, the Town pays pensions to approximately 350 retirees. These liabilities are funded by the Town’s pension fund, which totaled $450 million as of the end of 2025. The funds are invested in a wide variety of financial securities, including approximately 70% in US equities. The balance is invested in foreign equities and other more specialized assets. These investments have performed exceptionally well in recent years, increasing our pension fund to 2% more than we need to cover our commitments, based on actuarial projections.

We should be careful about cheering too loudly, however, since the market is unpredictable and the value of the fund can drop, which it did in 2022.

The individual pensions are complex and have changed significantly over time. Before 2017, retirees enjoyed traditional “defined benefit” pensions, where the benefit amount was guaranteed and fully protected. 

Employees now participate in hybrid plans that combine a guaranteed portion – that defined benefit – with 401K-style plans in which the Town partially matches contributions from the employee.

The defined portion of the plan requires contributions from the Town and the employee, who becomes eligible for the full benefit only after working for 10 years. The pension is determined by the base pay of the employee’s final year. Overtime is not included.

Importantly, the benefit includes an annual cost-of-living adjustment (COLA) up to a maximum (currently 2.75% for police and fire), which can accumulate substantially over long years of retirement.

We thank Gray Conrad and his staff for taking us through the salary and pension items that are so fundamental to Westport’s budget. Because of its complexity, this subject is rarely discussed in the public forum. But with such a significant impact on our quality of life and our Town’s financial health, it warrants greater attention and understanding.

Editor’s note: The Westport Journal would like to thank Finance Director Gray Conrad and his staff for this expense-related interview and we look forward to future discussions as the budget process develops. 

Brian Stern

^{_{Brian Stern spent 40 years at the Xerox Corporation in a variety of executive capacities. He earned an MBA from the Harvard University Graduate School of Business Administration. He spent 14 years on Westport’s Board of Finance, eight of them as Chairman.}}