Public frustration with the Santa Barbara City Council’s approval of employee pay raises was voiced during Tuesday’s council meeting, but the council chose to move forward with the agreement on a 5-2 vote.

Mayor Marty Blum and Council members Roger Horton, Grant House, Helene Schneider and Das Williams voted for it. Council members Iya Falcone and Dale Francisco voted against it.

The council met to adopt ordinances on the memoranda of understanding and salary plans that would affect more than 560 city employees and were passed last week. The agreement uses a variety of measures to offset the raises, which proponents say have already been decreased. By using measures like workers taking a 5 percent furlough of workdays and suspending their vacation cash-out options, labor costs for 2010 would come in at nearly $22,000 less than current costs.

The agreement includes employees of the city’s treatment and patrol division, who work in the water and waste water division and also with airport and Harbor Patrol and park ranger functions. These employees will receive a 2.5 percent pay increase in April of this year, and 1.5 percent next April, and instead of a 5 percent furlough, those employees will forfeit cashing in their vacation days.

Hourly employees, managers and supervisors would also see slight pay increases, but some would see delays in the raises and would be subject to the 5 percent furlough. Supervisors would also be eligible to take Cesar Chavez Day off, but vacation cash-out options will also be suspended for this group in 2010 and 2011, if necessary. Kristine Schmidt, the city’s employee relations manager, said last week the long-term costs associated with the agreements would be realized in 2011 if the city chooses not to extend furloughs and the vacation cash-outs. Otherwise, the results would be seen in 2012, and could cost the city up to $1.8 million at that time.

A half-dozen speakers came forward to express their chagrin with the city’s financial move.

“If I ran my household the way Santa Barbara finances are being run now, I would be bankrupt in a matter of weeks,” said Shirley Force. “How dare you give raises? How dare you give more paid holidays? I vigorously protest.”

Charlie Watson, a harbor commissioner, called the salary and benefits structure of the Waterfront Department “unsustainable.” He said revenue for this fiscal year is down $600,000 and expenses are up by $400,000.

“The current plan to raise union wages and offset that with unpaid furloughs does not help the waterfront department,” he said.

“It’s no secret that overspending at all levels of government are threatening our financial viability,” said Michael Self. “Unemployment numbers are rising, and it’s likely that if you approve these percentages today, you will be dooming a percentage of employees to the unemployment line.” She said other cities had negotiated wage cuts, and encouraged Santa Barbara to consider doing the same.

Francisco, who was absent for last week’s vote, encouraged the council to hold off on the item and revisit negotiations.

“When these negotiations started, we were not in the economic situation that we are today,” he said.

Francisco said he had received “astonishing news” in the past week about the extent of the drop in city revenues. Sales tax for the last quarter of 2008 was down nearly 21 percent, he said, and the city’s bed tax was also down last month by 11 percent.

“And that’s on top of months of double-digit declines,” the likes of which haven’t been seen in decades, he said.

But Williams disagreed, and said that not agreeing to the terms “exposes the city to this little thing called bargaining in bad faith.” Williams said employees, especially managers and supervisors, had already given up a lot of money in the agreement.

“I really invite you to look at that instead of simply believing what you’re told in headlines,” Williams said.

Schneider said the council was seeking renegotiation with one of the bigger bargaining units, Service Employees International Union, and that she hoped the Santa Barbara Police Officers Association and the Santa Barbara City Firefighters for Better Government would come to the table. Falcone sided with Francisco on the issue, saying that “if you blow the trust, and you blow the relationship, you’re not going to get anywhere into the future.” She recommended that the city take a breath and come back to the item.

“For the current fiscal year, the city would be spending slightly more with these agreements,” said Schmidt, but that next year the city would be spending about $580,000 less, particularly out of the city’s general fund.

Williams said the council needed to take action to save money for next year, but when Blum told him she didn’t “think the average person knows how giving a raise to the staff in this unit would save any money,” the comment elicited an eruption of cheers from the audience.

Williams responded by saying that employees would be taking more pay cuts than they are getting raises.

“If we delay, all we’re going to do is put ourselves deeper in the hole,” he said.

After the item passed, Williams encouraged people to keep participating in the city’s upcoming budget discussions.

“We never get this many people during budget discussions,” he said, addressing the public. “We really need to close a $9 million deficit and we can really use your input.”

“But are you going to listen?” someone called back as the council left the chambers after the item was passed.

— Noozhawk staff writer Lara Cooper can be reached at lcooper@noozhawk.com.