December 1, 2011 in City

City Hall union offers to freeze pay

Concessions don’t affect 5 percent raises in 2012
By The Spokesman-Review
 

The leadership of Spokane City Hall’s largest labor union has made an offer that normally might be hard to refuse: Three years of frozen pay levels.

But it would leave a scheduled raise of up to 5 percent in place for some workers in 2012 and wouldn’t change employee benefits, prompting Mayor-elect David Condon to wonder if outgoing Mayor Mary Verner, who approved the tentative deal, is trying to shield city workers from tougher negotiating once he is sworn into office.

“These things normally go through a much more thorough process,” Condon said Wednesday. “It seems like a Hail Mary pass at the end of the term.”

Joe Cavanaugh, president of Local 270, said the proposal for a three-year pay-rate freeze is unprecedented. The change in leadership “wasn’t the primary consideration” for making the agreement, he said. Preserving jobs was.

“I’m trying to help solidify the budget,” Cavanaugh said.

Cavanaugh said the basis for the deal originates from concession talks the union held with administrators last year, which ended with no agreement being reached. Local 270, which is affiliated with the American Federation of State, County and Municipal Employees, represents about 1,100 city workers, including most water, sewer, garbage and street employees. Its membership makes up nearly half of the city workforce.

The current contract for Local 270 doesn’t expire until the end of next year.

The new proposal, which will be considered by union members for a vote next week, would extend the contract for an additional three years. The union would not get cost-of-living raises in 2013, 2014 and 2015. Other benefits would not increase or decrease. The offer would not change terms for 2012, when members with at least four years of experience will receive 5 percent raises.

If the cost to the city for paying medical insurance premiums rose by an amount that equaled 4 percent of the total cost of the contract, the deal would reopen. But city officials say it would take a premium increase of around 23 percent for that to happen. Budget Director Tim Dunivant said premiums rose by about 7 percent this year, 12.5 percent last year and didn’t increase at all in 2009.

Condon, who is in Boston this week for a mayoral training session sponsored by the U.S. Conference of Mayors, made City Hall compensation a major theme of his campaign, promising voters to be a tougher negotiator with city unions. Verner pointed to concession agreements made during her term and said being tough but fair proved fruitful in holding down costs.

In a written statement Wednesday, Verner called the proposal “an excellent deal for the long-term financial interests of the city.”

“I want to leave the city in great condition when my term concludes, and this agreement helps do that,” she said.

If the offer is approved by union membership, the Spokane City Council will have the final say.

Councilwoman Nancy McLaughlin said given the quickness of the deal, it’s hard to believe that it includes the best terms the city could win through normal negotiations.

“They weren’t even at the table and suddenly a deal is struck with the mayor,” McLaughlin said. “It makes me think that they must be fearing a new mayor coming to town.”

But some council members said the deal appears to be in the best interests of the city.

Councilman Richard Rush said the contract would significantly impact the city’s “structural gap.” That’s the term administrators use to describe how forecasts continually predict costs rising faster than revenues.

“This seems to come very close, if not hit the mark, of achieving that goal,” Rush said.

Councilman Jon Snyder said he still has to study the details but isn’t too worried about extending a deal that would prevent Condon from making a deal himself.

“He’s romanticizing how fun it is to work on these labor deals,” Snyder said. “It may end up being a nice Christmas present for him.”

Chief Financial Officer Gavin Cooley said three years of frozen pay levels would have “a definite positive impact on the city’s finances compared to the increases we have typically negotiated.” But he added that the city has also worked hard to hold down the costs of benefits.

“As the recession has continued, most cities and states have begun making significant changes to their very generous employee benefit packages,” he said. “That opportunity is left on the table with this proposed agreement and that is something the council will have to take a hard look at.”

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