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City, Unions Working to Negotiate Budget-Cutting Concessions

Furloughs, pay freezes and other options are on the table as Santa Barbara faces a $9 million budget gap

City officials have said there’s only one way Santa Barbara can make up its projected $9 million budget gap for next year: through major labor concessions with the nine employee unions.

Kristy Schmidt, the city’s employee relations manager and labor negotiator, has begun negotiations with all groups and made a tentative agreement with the supervisors union on Tuesday, she said during the City Council meeting.

The managers and supervisors groups agreed to postpone their April 10 scheduled increase, as did the police and fire chiefs and deputy chiefs, she said.

According to an e-mail from Schmidt to the mayor and council, the tentative agreement with the supervisors has the potential to generate up to $889,893 in savings for fiscal year 2011 through unpaid furloughs, the suspension of vacation cash-outs, relinquishing the April 10 1.5 percent scheduled raise, and requiring employees to put in another $95 per month toward health benefits.

Noozhawk recently sat down with Schmidt and administrative services director Marcelo Lopez to talk about the labor negotiations, which they say are essential to make any major dent in the upcoming budget gap without huge layoffs.

“I lay awake at night thinking, ‘$9 million,’” Schmidt said.

If the concessions from the supervisors union are ratified by the membership, it will be close to a 10 percent cut in salary and benefits, which is a target number for the city’s negotiations.

If all nine unions take a 10 percent concession, the total savings would be about $6.6 million, leaving the city with a $2.25 million problem for the next fiscal year — much more manageable, Schmidt said.

In comparison, every union would have to take a 13.4 percent concession in order to solve the 2011 budget problem, according to the finance department.

“Nobody wants to give up part of their package, but nobody wants to see their co-workers get laid off,” said Victor Garza, the parking and transportation management program superintendent.

Garza, who attended Tuesday’s council meeting as a union representative, said the contract was set to expire next January. The supervisors union includes about 80 employees, with 40 paid from the general fund and 40 from enterprise funds.

The supervisors union, like many others, came back to the table voluntarily since it has a current labor agreement, and its agreement is contingent upon concessions with the police union.

“If the city ultimately settles for less with the police union, concession for this group would be reduced accordingly,” Schmidt wrote in the e-mail.

The Police Officers Association’s contract — the first of city employee unions to expire — was extended until June, and Schmidt is in negotiations toward a bargaining proposal.

Schmidt is the city’s professional representative, and she meets in closed sessions with the City Council to get direction. She negotiates with union staff and union members and occasionally attorneys to reach an agreement everyone can live with, she said.

Last year, all nonsafety unions took a 5 percent concession through furloughs and suspended vacation cash-outs. Even if all unions took that cut this year, it wouldn’t be enough. Ten percent is better, though the city wouldn’t necessarily try to solve the entire budget problem through labor concessions, Lopez said.

Eighty percent of the city’s expenditures go to salary and benefits, and 89.5 percent of city staff is unionized, excluding elected officials, managers and those involved in labor relations because of a conflict of interest.

Police and fire unions weren’t included in last year’s cut, but would need to participate this year to help out — and other unions have expressed that they’re looking for solidarity in concessions, Schmidt said.

Options for labor concessions include postponing scheduled raises, suspending vacation payouts, unpaid furloughs and paying more toward retirement — which police and fire don’t pay into — and health care.

“Without having labor groups work with us … we just can’t do the math,” Lopez said.

So far, all groups have at least come to the table to discuss renegotiating their contracts voluntarily, which staff commended as being in the spirit of partnership.

Concessions will be applied across the board, as nonunion employees will get the same concessions — most likely in the 10 percent range.

“It’s not really an ask, it’s a tell,” Schmidt said of unorganized employees. “It’s a balance between what we need and what the employees can give up.”

A comparison chart summarizing benefits for each bargaining unit can be found by clicking here. It includes salaries, premium and special pays, insurance, retirement, monetary allowances and time off/schedules.

According to the chart, the Police Officers Association’s salary and benefit increases were equivalent to 26.5 percent for sworn and 16.4 percent for nonsworn in their 2006-09 agreement, which was extended until June 30 of this year. A 10 percent concession would amount to about $2.01 million, according to the finance department statistics.

The Police Management Association’s salary increases were 3 percent in July 2008 and 3 percent in 2009 under its contract. A 10 percent concession would be $188,400.

Ten percent from the firefighters association would amount to about $1.21 million. In the 2007-10 agreement, there was a 5 percent base salary increase in 2007, 3 percent in 2008, 5.5 percent in 2009, 2.5 percent this January and a scheduled 3 percent for July.

The general unit SEIU, which is the largest bargaining unit with about 500 employees, had 1.5 to 3 percent increases from 2008-2010, and was one of the five unions to voluntarily take a 5 percent cut for this fiscal year.

The Treatment and Patrol SEIU unit got a 4 percent increase in 2009, and a 10 percent concession would equal about $12,000. The supervisors union, which has a tentative agreement with the city, had a 4 percent increase in January 2009. Nonsafety managers and confidential employees taking a 10 percent hit would generate about $714,000 and $238,000, respectively.

For more information, click here for the Council Agenda Report from the Feb. 25 budget work session.

Noozhawk staff writer Giana Magnoli can be reached at .(JavaScript must be enabled to view this email address).

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