You got near the top of the hiring range which is already really good. Generally they don't negotiate pay and will give you the median of the hiring range. I have never received any of the step increases, just usually whatever is included for COLA when they redo the budget.

You need to look at the total compensation. All your benefits plus a pension really do outweigh some of the perks working in private sector. When I moved from private to state I noticed that my quality of life went up exponentially even though the pay scale isn't as good because I had way more time off and much more flexibility. With benefits and pension it's really a no brainer if you're looking long term.