TAYLOR: Council rejects firefighters' contract

By Rene Cizio

TAYLOR — The City Council rejected a tentative agreement with the firefighters’ union Tuesday that would have helped the Fire Department meet its budget requirements.

The vote was 4-2 against the pact.

A sticking point in the agreement for some council members was a buyout plan and a clause that would prevent any layoff of firefighters currently employed by the city.

The contract was voluntarily opened up by the union. Its contract does not expire for another year.

The Fire Department had a budget of about $8 million last fiscal year, but that revenue has dropped to about $7 million for the 2010-11 fiscal year, which started July 1.

Expenses have remained roughly the same, however, so cuts are needed.

The department is funded by several sources, including a police and fire pension millage, state-shared revenue and advanced life support transport.

With its expenses, the department still needs to come up with a way to fill a $615,000 gap between revenue and expenses. That’s why the union and the city administration agreed to some contract changes.

Changes for a proposed extension until June 2013 were:

Firefighters would give back a scheduled 1 percent raise, saving the city about $43,000.

Firefighters would increase their pension contributions from 5 percent to 7 percent — about an $84,000 increase.

Three office staffers would go back to suppression, saving about $20,000 through salaries.

Firefighters would no longer receive overtime, but would take flextime instead, saving about $140,000 for one year.

The department would eliminate minimum staffing requirements.

No firefighters hired before January 2010 would be laid off by the city for the remainder of their careers, among other changes.

The agreement would have gone into effect only if five firefighters took buyouts, creating a big enough financial savings for the city.

Dean Philo, director of budget and finance, said if five firefighters took buyouts, it would have saved about $265,000 for payroll.

He said nine firefighters would be eligible to take buyouts, for a savings of about $478,000.

Four firefighters are eligible to retire now without the buyout incentive.

Councilman Richard Sollars made the motion to deny the agreement; it was seconded by Councilwoman Suzanne Weycker.

Sollars said there was one key reason he would not approve the contract — the layoff clause.

“It protects them for their entire career,” he said. “I don’t think anybody is going to be willing to give that up in future negotiations. It’s guaranteed employment. In no other business can you get that type of guarantee.”

Councilman Dennis Stapleton said he didn’t approve the agreement, in part, because of the layoff clause.

“It’s just tying us in, and I don’t think it’s a good idea,” he said. “The economy is just too fragile right now.”

Fire Chief Steve Portis said the layoff clause isn’t a big deal because the department essentially already has that guarantee through a minimum staffing clause in the current contract that provides the department with a minimum of 53 suppression staff and 14 required to be on duty at all times. The department currently has 54 in suppression.

If, with the current contract, the department lost more than one firefighter, the city would be contractually required to hire a replacement.

Portis said giving up minimum staffing in the agreement was a fair trade for the layoff clause.

“Giving up minimum manning is virtually unheard of as far as contracts go,” he said.

Without the minimum staffing requirement, the city would not be obligated to replace retirees.

A sticking point for Weycker was the buyout plan.

According to the agreement, five firefighters would have to retire and pay 5 percent of their base wage to the city for each year they bought toward their retirements.

Even those four eligible to retire naturally could buy up to five extra years of service, increasing their pension benefits. Their contracts give them a bigger pension multiplier for more years in service. However, if they worked the five years, they’ll still increase their benefits.

Philo said the cost of buying five years could be between $18,000 and $20,000.

He said the buyout plan was beneficial to the city because if the firefighters didn’t retire, they would continue to collect a salary and benefits, and add more paid absences to their final average compensation, thereby raising their pensions.

When retiring, city employees are able to cash in their unused vacation and sick time and other benefits, which adds to their final average compensation. Their pension is figured based on their highest three years of service, and the added boost can increase pension allotments.

Philo said taking the buyouts would keep them from adding paid absences to their final average compensation.

It is a common practice in many cities that employees near retirement save their paid absences to boost their final average compensation.

“If they take the buyout, they’ll pay the city for the extra years and they would start collecting their pensions right away instead of their wages,” Philo said.

Weycker said she wants the firefighters to work their five years without the buyout option.

She said one firefighter’s pension is expected to be up to $103,000 a year, plus full benefits, for life.

“It doesn’t seem right anymore,” she said. “They should work the years. I do believe they deserve a fair, decent pension, and I think they get one. I just don’t think we can keep doing these buyouts. I believe you have to work for what you get.”

Portis said there’s little that can be done to minimize the pensions now.

“For over 20 years, the city has used pensions as a bargaining tool,” he said.

Often in bargaining, unions have been offered pension enhancements instead of raises and other benefits, but those pension deals are now due.

“They’re going to receive their pensions anyway,” Portis said.

He said the buyouts make sense to give them incentive to retire and drop some departmental costs now.

“It is the compensated absences that really impact the pension (system),” Portis said.

Philo said the police and fire pension system is about 72 percent funded — $40 million short of being fully funded.

Stapleton said he doesn’t agree with the buyouts, either.

“All it’s doing is overloading the pension programs,” he said. “People are retiring at an early age and collecting huge pensions.

“(The agreement is) a short-term fix, but it adds to the long-term problem.”

After three hours of council debate, the agreement was rejected.

Voting no were Sollars, Stapleton, Weycker and Councilman John Delo. Voting yes were Councilwomen Cheryl Burke and Jill Brandana. Councilwoman Jacklyn Molner was absent.

Burke and Brandana said they were dismayed about why the four council members wouldn’t vote in favor of the immediate savings.

Stan Pochran, president of the Taylor Professional Firefighters Association, said the union is disheartened by the rejection.

“We share their concerns over the financial situation of our city,” he said. “That is why we worked so hard to come forward with a plan to save the city money while still continuing to provide the same outstanding level of service to our citizens. In spite of this setback, the union remains committed to working toward a solution that does not compromise the safety of the citizens of Taylor.”

Philo said that without the agreement, the firefighters could have to be back-paid to July 1 for their 1 percent increase. And, some firefighters will receive contractual promotions to higher pay levels.

He estimated the contract rejection will cost the city about $33,000 a month.

Weycker and Stapleton said they’d like the firefighters to offer wage cuts.

“Over the last few years, the Fire Department has received very large wages while other unions took cuts in their pay, and I think we should be going more in that direction,” Stapleton said.

If the city chose to lay off firefighters, it likely would lose its ability to provide emergency transport.

In order to make the reduction through layoffs, six employees would have to be laid off. By doing that, however, the department would have to stop advanced life support transport, which is anticipated to generate about $1.5 million this fiscal year.

If the department stops ALS transport and loses that revenue, Portis said, he’d have to cut up to 10 more employees.

Layoffs still come with unemployment costs, however.

Union and city officials said they’re willing to continue working on an agreement.

“Every day that goes by and every month into this fiscal year, those savings that are projected here go down,” Mayor Jeffrey Lamarand said. “This council’s actions have taken nothing into account for the safety of this community.

“If the transport goes away, private companies will be responsible for emergency response for residents. We’re not for-profit. We’re operating for the good of the citizens.”

Philo said city officials thought they had a good contract that achieved the necessary savings.

“Now we’ve got to go back to the drawing board, and the longer it goes, the worse it gets,” he said.

“We have to find some other way to save the $615,000 the budget anticipates needing to be saved.

“If we can’t work that out, then something else has to happen, cuts in other departments, layoffs in the Fire Department, or whatever else it might be.”