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After nearly two months of negotiations, the City of Gilroy and the Gilroy Police Officers Association have agreed on a new two-year contract that awards 2 percent raises each year for all 59 police officers within the union.

LeeAnn McPhillips, Gilroy’s human resources director, said the city is happy with the outcome of the settlement.

City Council is expected to vote on the contract during their regular meeting Monday, June 4, and McPhillips is confident it will be approved. If it is, the salary increase will go into effect July 1.

The raises are compound, meaning this year, the wages will increase by 2 percent, but in 2013, another 2 percent increase will be added on top of the previous 2 percent raise. McPhillips said the total financial impact to the city for the new two-year contract is $343,400.

When the increase kicks in, a new police officer recruited straight from the police academy will earn a $75,396, salary, up from $73,918. The highest paid police officer’s salary will increase to $91,645.

The lowest pay bracket for a police sergeant will now be $89,471, and the highest bracket will reach $108,748. The contract excludes police captains, who are under a different union organization.

These numbers reflect base salary, and do not include benefits or overtime.

“Obviously, we would have liked it to pay less, but also understand that this is a compromise, and we wanted it to work for both sides,” Mayor Al Pinheiro said.

The new contract pleased the Police Officers Association for the most part, considering the city is finally beginning to rebound from the economic downtown of recent years, said Police Officers Association president Jason Smith.

But in future contracts, Smith hopes their wage increase will be higher to stay competitive with other Santa Clara County police department salaries.

“Eventually we would like to achieve parity with other agencies in the county, since Gilroy is the on the low end, if not the lowest,” Smith said.

Gilroy’s police salaries are lower than cities like Morgan Hill, Palo Alto and Milpitas.

But these base salaries don’t include benefits packages, Smith pointed out. Because Gilroy police officers agreed to pay 9 percent of their retirement benefits in 2010, a cost the city had previously absorbed, Smith said even with this increased salary, Gilroy police are on the low spectrum of police salaries.

While Smith is right – police take home 9 percent less each pay check than they did before 2010 – officers will eventually see that money when they retire.

McPhillips said while the union likes to compare salaries within the county, the city takes a regional view and compares police salaries in towns north, east, south and west of Gilroy, in which Gilroy is in the “middle of the pack.”

“We believe that is a more balanced view of how salaries stack up than just looking at the county,” McPhillips said.

McPhillips acted as the lead negotiator for the city, and she alone represented the city in negotiation meetings.

Both Smith and McPhillips said they saved thousands of dollars in legal fees by closing negotiations more than a month before the current contract expired.

LeeAnn said she didn’t know how much it would have cost the city to extend negotiations for another month, but she did compare it to negotiations with firefighters back in 2006, which dragged on for six to eight months and cost the city $54,000.

“We all worked together and wanted what was best for both sides,” Smith said.

Pinheiro said he was pleased that everybody came to a consensus swiftly, “without going through a long and expensive period of negotiations.”

The city spent about $19 million annually on police services in each fiscal year from 2007 through 2009 – totaling more than 40 percent of the city’s general fund for each year.

Christine Turner, the city’s finance director, said that 70 to 75 percent of the annual general fund is spent on police and fire services.

Councilman Dion Bracco said the 2 percent increase per year is a good deal for the city, and fair in light of the cut backs that police took in 2010.

“They gave up quite a bit and they haven’t had a raise in a long time. And we still have to remain competitive against other cities,” Bracco said.

• Total fiscal impact to the city for the wage increase: $343,400
• Amount spent each year on police services from 2007-2009: $19 million
• Lowest salary bracket for a police officer: $75,396
• Highest salary bracket for a police officer: $91,645
• Lowest salary for a police sergeant: $89,471
• Highest salary for a police sergeant: $108,748    
• Morgan Hill police officer: $83,112 – $106,074                                                                                                                               
• Morgan Hill sergeant: $96,209 – $122,790
• Los Gatos police officer: $88,483 – $107,556
• Los Gatos police sergeant: $113,672 – $138,174
*Morgan Hill and Los Gatos police collected from their respective city websites.

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