The Morning Report
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Wednesday, April 15, 2009 | In a shocking unanimous decision, the City Council voted late Tuesday to impose contracts on police officers and blue-collar workers after the groups failed to come to an agreement with Mayor Jerry Sanders.
The 8-0 votes, which drew gasps from the audience, were especially surprising because the council was viewed as pro-labor after a November election in which three new council members were elected with the support of organized labor. Council members voted without comment.
Sanders said he had reached last-minute tentative agreement with the unions representing the firefighters, white-collar employees and deputy city attorneys.
Council members chose not to exercise a new option they had this year under an opinion from City Attorney Jan Goldsmith to return the parties to the bargaining table instead of simply rejecting or imposing the mayor’s final offer. Several union leaders urged the council to do that before the vote.
Brian Marvel, president of the Police Officers Association, said the union was “serious about negotiating with the mayor’s team in a good-faith bargaining effort … and if given the opportunity, we will continue to do so.”
After the vote, Council President Ben Hueso said it was apparent that the two unions were simply too far away from the mayor’s proposal to reach an agreement without the council’s vote to impose the contracts.
“We weren’t getting anywhere close to where we needed to be,” Hueso said. “We can negotiate for a year and not [gain] any ground. We’ve been doing this for three months, and we need to find a way to keep our city functioning and move forward.”
The mayor had proposed cuts to worker compensation totaling about 6 percent, which would essentially make up half of the $60 million budget deficit for the fiscal year starting July 1. The mayor picked out a target for each union, which labor negotiators said was their “fair share.”
The council chambers overflowed with city employees who pleaded with council members not to impose the contracts. They said the cuts would devastate their families and make it impossible to make ends meet.
That plea was most strident from the city’s blue-collar workers represented by the American Federation of State, County and Municipal Employees Local 127. Many city workers said while higher-paid employees might be able to absorb that hit, they couldn’t. With many wearing stickers that read “Cut the Fat,” they said City Council members should consider a raft of budget-saving proposals offered up by the union, including slicing layers of management.
Joan Raymond, president of the blue-collar union, was stunned by the decision to impose contracts, saying the union’s proposed cuts were “very similar” to the amount of money the mayor was seeking.
“Apparently, it wasn’t the right method they wanted,” Raymond said. “We were very, very surprised because it really penalizes the lowest-paid workers in the city.”
By imposing the contract, the city is requiring blue-collar employees to pick up a larger share of their retirement contributions.
The union had sought to freeze salary and benefits for two years, but rise in the third year based on inflation. It also sought to suspend the city’s contribution to a supplemental retirement plan for two years.
The police union had agreed to pick up a larger share of pension contributions and to adopt a lower rate of return for participants in the deferred retirement program. But it did not concede to cut wages by 1.5 percent and change its health care plan, saying the cuts would exceed 6 percent for many police officers and hamper efforts to recruit and retain good officers.
Hueso, who was backed by labor in his bid for the council presidency, said the employees have “very strong arguments,” acknowledging that most haven’t had their pay rise in years.
But Hueso said there’s no easy decision and the plan for across-the-board cuts is generally a fair one, noting that higher-paid employees will lose a larger dollar amount. He also said the decision would allow the city to avoid layoffs and service reductions that would affect the quality of life of all residents, including employees.
Sanders has stressed similar themes in support of his spending proposal released Monday. To underline the point, he held a press conference Tuesday morning in front of the Ocean Beach library, one of seven he proposed closing last year in an unpopular move rejected by the City Council. On Tuesday, Sanders said cutting worker pay was essential to keep libraries open and not reducing hours.
In addition to the cuts meant to help close the budget gap for the upcoming year, Sanders said he was seeking long-term reform, namely through major changes to the city’s retiree health care system, which has been barely funded since the benefit was first granted in 1982.
Going into Tuesday’s hearing, the mayor’s retiree health care proposal was the sticking point with the Municipal Employees’ Association, which represents the city’s white-collar employees.
MEA attorney Ann Smith said the union had opposed making the changes the mayor sought to the benefit. She said the union believes retiree medical care is a vested benefit that can’t be changed. At the very least, Smith said the city charter requires a vote of all employees.
She said the two sides ultimately agreed to study the issue of how to fund or change retiree health care. For those two years, Smith said, the union agreed to suspend a clause that increases the city’s payment by up to 10 percent a year because of rising medical costs. That could leave retirees responsible for a larger share of their health care as costs increase.
Smith said that doesn’t violate the vote requirement because it’s a temporary and not a permanent change, which she said would require a vote of the members.
It’s possible that employees will disagree and file suit. But Smith said agreeing to suspend the increases for two years was the best bad option.
“The alternatives were quite drastic and we wanted to take the lesser of the evils that were presented to us,” she said.
It wasn’t immediately clear what changes other unions would see to their retiree medical benefits as a result of Tuesday’s votes and the tentative agreements.
The mayor praised council members for the vote to impose contracts.
“A lot of councils have just made the easy decision for years,” Sanders said. “This council made a very difficult decision and I appreciate the leadership.”
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