TOUGH DEALS IN TOUGH TIMES

By: 
Dieter C. Dammeier

All of us have been experiencing the economic recession and resulting shortfalls to state and local government revenue. As with anything else, some agencies are fairing better than others. Local governments that have had good financial planning to save money during the good times are able to whether the economic storm with little impact. Of course, local governments that spread their revenues too thin by opening non-priority services or expending unnecessary funds in purchasing real estate have found themselves having to slash compensation when the revenue shortfalls hit. Fortunately, for the three POA's below that I represent, their cities have managed to prioritize their finances enough to ensure that each city could properly staff and compensate the most important service it provides, public safety.

Cypress POA

As expected in Cypress, with current City Manager John Bahorski the POA knew it would have its hands full in negotiations. Bahorski had come to Cypress from Seal Beach and the Seal Beach police officers had warned Cypress officers that he was unsupportive of public safety. Fortunately for Cypress, the POA had become politically active and was able to cause movement through communications with the City Council directly. As a result, the Association and City ended up with a four-year contract. Year one calls for a lump sum payment of $2,550.00 and an increase in medical of $40.00 per month. Year two calls for an additional lump sum cash payment of $2,500.00 with a 2% raise in salary and a $30.00 increase in medical per month. Year three calls for a 3% increase in salary with a $25.00 per month increase in medical and year four calls for an additional 3% increase in salary with an additional $25.00 in medical.

The contentious item that surrounded Cypress POA's negotiations was the City wishing to maintain the employees' contribution toward the cost of the PERS pension. The police officers have been contributing 6.132% of the PERS contribution since implementing 3 at 50 in 2001. Given that most agencies have eliminated the employee having to pay any portion of the contribution, Cypress POA was hoping to eliminate this as well. Unfortunately, given the current atmosphere in the public toward pensions in the public sector, the POA decided to hold off on the PERS issue for another day.


Garden Grove POA

Garden Grove POA led by its President Jeff Hutchins was very successful, given the current economic climate, in obtaining low and no cost items in a two-year contract. The resulting contract called for a 0% raise in year one with a 2% salary increase in year two of the contract. Medical coverage is to increase a minimum of 5% in year two with a reopener to discuss further increases. The GGPOA was able to increase the cash out of sick time to 75% upon retirement (was at 50%). An additional 10 hour holiday was added along with the ability to sell back vacation hours to the City on an annual basis. Finally two hours per month was added to the sick leave accrual per employee.

Placentia POA

Placentia POA took a look at the City's finances prior to commencing negotiations and had the unfortunate realization of the City's bleak financial condition. Despite the City's finances, the Police Association leadership was able to convince the City that it needed to place more priority in retention of its police officers who had recently been a leaving to other agencies. The end result was a three-year contract. The biggest movement came in medical insurance. The POA was successful in having the City move from its traditional private sector model of health insurance to CalPERS for medical. Along with the switch came an increase of over $300.00 per month making the maximum City contribution $1,151.00. The contract provides a salary increase in year one of between 2.5% and 4% depending on the Consumer Price Index for Los Angeles and Orange County. In the second year of the contract an additional increase of between 2.5% and 4% will occur, again depending on CPI.

A team approach was developed to determine the compensation increase for year three. The City will survey the community to determine the viability of a tax revenue increase to fund public safety. If a positive response comes out, the City will place such a measure on the ballot for the voters and of course the Police Officers Association will support the measure. In the event of new revenue being approved by the voters, the officers would receive in the third year of the contract an increase of between 3% and 8% depending on their compensation position in Orange County compared to the other police agencies at this time. Additionally, reopeners in the medical insurance are provided for each year with the City picking up at a minimum one half of any increases in the CalPERS insurance rates.

As you can see, while times are tough, there are still cities out there that are not falling in line with the anti-public employee tune of cut and slash at all costs by using the economy as an excuse. While under our current conditions, the contracts of the recent past are not in abundance, there are still decent deals to be had with the right amount of effort put in by the association as well exemplified by the above three police associations.

ABOUT THE AUTHOR: Dieter C. Dammeier is a partner at Lackie, Dammeier & McGill, an LDF panel attorney and the firm's chief negotiator for its police association clients throughout California.

 

 

 

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