For weeks now, city officials and Gilroy firefighters have been
hard at work at the negotiating table trying to iron out a new
contract. Against a backdrop of tough economic times, the
firefighters have been striving to improve their retirement plan;
the city has been trying to keep costs under control and achieve
desperately needed staffing flexibility.
For weeks now, city officials and Gilroy firefighters have been hard at work at the negotiating table trying to iron out a new contract. Against a backdrop of tough economic times, the firefighters have been striving to improve their retirement plan; the city has been trying to keep costs under control and achieve desperately needed staffing flexibility.
On Wednesday, the bad news hit: through their union attorney, the firefighters officially declared an impasse. city law requires that the matter now be sent to binding arbitration. This is a disappointing development for several reasons. History has shown arbitration to be unkind to all parties: a lose-lose-lose, costing the city thousands of dollars in wage-and-benefit increases, staff time, and legal expenses. The process creates a tense working environment for labor and management, and often results in problematic workplace rules and conditions. Moreover, the offer the city had on the table Wednesday was excellent. It would have given the firefighters improved retirement benefits, held down city payroll costs, and increased the staffing flexibility needed to provide better fire protection with no reduction in fire positions. It would have been a win-win-win for the city of Gilroy, its firefighters and its citizens. But Firefighters Local 2805 said no.
Instead, they held out for a set of demands that are excessive and far too expensive. In these lean times, the union’s demands are, quite simply, unreasonable. The wage and benefits package Local 2805 is demanding equates to a 26 percent increase. The union’s “3 percent at 50” retirement proposal – which would allow a firefighter to receive 90 percent of his or her final year’s pay, annually, beginning at age 50 – equates to a 10.5 percent raise in payroll spending alone.
And that’s not all: Local 2805 is demanding a 9 percent pay increase over the next 36 months. The retirement and pay increases, combined with their demands for increased city-paid health care contributions, a post-retirement cash benefit and paid leave for union business, amount to an increase of more than $1 million annually in city spending on firefighter payroll. And perhaps worst of all, the firefighters said no to the staffing deployment flexibility the city needs to better manage its resources, hold down overtime costs, and staff a third fire engine at Sunrise Station.
Now, it bears repeating – we appreciate and respect our firefighters. The city already spends nearly 80 percent of its tax dollar on public safety. And the firefighters already enjoy a fair contract. Gilroy pays its firefighters over 10 percent more in total compensation than their counterparts in comparable fire departments in the region.
For example, a top-step firefighter makes $79,900 in salary alone – not including overtime, holiday pay, uniform allowance or other benefits. A typical Gilroy firefighter enjoys a wage and benefits package worth approximately $132,000. But those costs are adding up.
The city’s contribution to its public safety employees’ retirement system, CalPERS, has increased every year since 2000 – from $883,000 to $3.25 million. With four-fifths of the city discretionary revenues going to public safety, other services – like parks and recreation programs, street and sidewalk maintenance, and downtown improvements – must get by with a shrunken slice of the pie.
Due to a bad economy, and increasing retirement benefit costs, the city has had to dip into its reserves for the last three budget years – including over $3 million this year alone. Now Local 2805 wants a 26 percent raise. As city leaders, we just can’t accept that. But we are willing to negotiate. Recognizing that retirement was the firefighters’ top priority, the city proposed a compromise: a 3-at-55 retirement package combined with no other cost increases and agreement on the much-needed staffing flexibility.
The city’s proposal would allow most Gilroy firefighters to retire at maximum benefit essentially at the same time as the union’s proposed package, but at roughly half the cost. Perhaps the union believes it will fare better in arbitration. But at what cost to the citizens of Gilroy?
Look around: Nobody in government, locally or statewide, is getting a 26 percent raise these days. In fact, many cities in the area are seeking wage concessions or deferral of previously-agreed-upon retirement enhancements. Other municipalities are facing financial disaster because their employees’ CalPERS pensions are sucking coffers dry.
There is a better way. By accepting a more modest package, everyone could come away with a win. The number of firefighters on duty would be maintained. The city could staff a third fire engine at Sunrise Station sooner. We could avoid a big arbitration fight. And we could all shake hands and get back to work.
The guest commentary was co-authored by Mayor Al Pinheiro and Councilman Bob Dillon.
