It was 2009 the last time the firefighters reached an agreement with the city on a contract – they were the first bargaining unit in that cycle to do so and they would not agree to another contract again for over eight years. The city council, in 2013, unanimously agreed to impose a last, best and final offer on the union, which has remained in place ever since.
But that has changed as the city and the firefighters’ union, Local 3494, have reached a tentative agreement. The contract is a tentative one-year contract agreement, retroactive to September 1, 2016, and ending August 31, 2017.
“This short term contract resulted from a nearly two-year long negotiation between the City and Local 3494 that resolves many outstanding issues and sets the stage for longer term agreement discussions to begin immediately,” the city announced in a release on Thursday.
The city council is now required to approve the agreement, which they are expected to do on August 29.
“This agreement symbolizes the turning of a significant page – correcting a variety of unworkable elements from past agreements and bringing the firefighters in line with the City’s other bargaining units in a variety of areas,” said City Manager Dirk Brazil in a statement.
He said, “Everyone had to give something to get to this point and I really appreciate the efforts of the City Council and Union leadership to bridge the numerous gaps that have existed for years.”
The terms of the agreement are laid out in the city’s release.
The city did not agree to make the agreement retroactive to 2012 when the previous contract expired. Instead, “the negotiating teams agreed to a date of September 1, 2016, resolving five years without a contract in place. The agreement, which expires August 31, 2017, will allow for the City and the union to begin negotiations on a timeline consistent with other bargaining units and requiring the City to make retroactive changes only to 2016.”
The agreement gives the employees, the best compensated in the city but who operated without a salary increase since 2012, a 3-percent salary increase retroactive to September 1, 2016.
The agreement also changes the pension conditions that were imposed by the city during the impasse. Davis firefighters received a 3 percent salary reduction in place of the additional 3 percent pension contribution the City was seeking from employees.
Announced the city, “This tentative agreement restores the 3% salary reduction in exchange for the employees paying the additional 3% pension contribution.”
Those employees hired prior to 2013 will now pay a total of 12 percent of their salary toward pension costs. Employees hired after January 1, 2013, pay 50 percent of the pension cost, currently 12.25 percent of salary, pursuant to the public employees’ pension reform act (PEPRA).
According to the city, “This provision is cost neutral and is consistent with all other City bargaining units.”
The city notes, “This tentative agreement replaces two longevity pay practices of the past – one invalidated by CalPERS, the other costing the City a large amount of overtime pay – with a single, more conventional approach consistent with all other bargaining units. The cost of this change will be more than offset by reduced overtime pay and long term pension costs.”
The agreement will tie the medical benefit premium to the Sacramento region rather than the Bay Area one. The city believes this will “significantly” lower the premium amount.
In addition, the city says “the expired agreement with Local 3494 provided the benefit at a fixed amount regardless of the number of people needing coverage. Employees could ‘buy up’ to much more expensive plans with no out of pocket expense.”
This tentative agreement “provides the employee a benefit for the employee category in which they are enrolled. If they choose a more expensive plan, the employee must pay the extra cost. Although enrollment changes from year to year, overall these changes are budget neutral.”
On retiree medical, under the terms of this agreements, “employees will pay 3% of salary into an irrevocable trust to fund retiree medical benefits. The retiree benefit for future retirees will also be reduced to mirror the medical language for active employees making it no longer possible to ‘buy up’ to a more expensive plan with no cost to the retiree.”
The city estimates the overall agreement cost of $170,000.
“One of the largest ongoing challenges the City Council faces concerns employee compensation,” said Mayor Robb Davis. “All California cities are faced with rapidly increasing pension and medical costs – including retiree medical.”
For him, “This agreement rectifies some, frankly, poorly conceived benefits of past contracts, and adds brakes on future medical costs. It restores past salary cuts requires increased PERS contributions. It provides a COLA but balances that with increased employee contributions to a medical trust fund. In the end, it is expected to cost the City more.”
But, at the same time, he said that “it sets the stage for important cost sharing going forward that we believe has the potential to keep costs in check. Because the City cannot impose these items we arrived at them through challenging negotiations that took time. I believe we have a stronger foundation for future negotiations than we had in the past with key issues corrected that need correcting.”
The Vanguard will have further analysis on this developing story.
—David M. Greenwald reporting