LA WATCHDOG--On Wednesday afternoon, Mayor Eric Garcetti, City Council President Herb Wesson, and Coalition of LA City Unions Chair Cheryl Parisi announced that City of Los Angeles and its six civilian unions had reached a tentative agreement on a four year contract covering more than 20,000 full and part time civilian employees. (Photo: Councilman Wesson, Mayor Garcetti)
However, the details of this agreement were not released, once again creating doubts as to whether this contract that was negotiated behind closed doors by our politicians is just another self-serving deal that is not in the best interests of all Angelenos. This concern is magnified by the fact that the community residents and advocates of the labor financed Fix LA Coalition participated in the negotiations.
But why were other knowledgeable Angelenos not invited to this party? Did they fail to make substantial campaign contributions? Did they represent informed citizens such as the Neighborhood Council Budget Advocates and employers who are concerned about the City’s Structural Deficit, its failing infrastructure, and unfunded pension liabilities?
The public is being kept in the dark on the specifics of this contract. But we can sleep well knowing that Eric assured us that this “fair and fiscally responsible” contract will “restore and improve” City services while “strengthening our budget position.” And Herb increased our trust by adding that this agreement will put “the City on a more certain financial footing.”
However, based on articles in The Times and Daily News, this new contract will have a negative impact on the City’s finances and the City Administrative Officer’s General Fund Budget Outlook (the “Outlook”).
According to the newspapers, there will be no increase in wages for the first three years of the contract. However, the 2% bump in the fourth and final year (2017-18) will cost an extra $35 to $40 million.
The City was also anticipating that the civilian workers would be responsible for 10% of the cost of their Cadillac healthcare plan. To the contrary, the City will continue to foot the bill, resulting in an estimated hit of more than $20 million a year. There is also no mention of requiring co-pays or establishing deductibles as is the case in the private sector.
{module [1177]}
The City and the six unions that comprise the Coalition of LA City Unions also reached an agreement on pension reform. This will settle existing litigation relating to the City’s establishment of a new pension tier/plan for civilian employees hired after July 1, 2013. However, the terms of the newly agreed upon tier are expected to result in significantly lower savings over the long term.
It also appears that the City was unable to reform its workers’ compensation program.
While the new contract will cost the City considerably more than projected in the CAO’s Outlook, the joint press release said that “the agreement puts the City in a strong position to rebuild its workforce by maximizing full-time hiring and proposing a robust job training program.” These new employees will also increase the City’s cost structure.
While this four year labor agreement will bring labor peace to the City for a year after our next election in the spring of 2017, the media and all Angelenos must not be rushed to judgment by artificially imposed deadlines dictated by Herb Wesson and the City Council. Rather, we need at least two weeks (ten business days) before the City Council begins its deliberations to review and analyze the contract (and all of its side agreements), its financial implications, and the CAO’s new Outlook and its underlying assumptions. We will also need ample opportunity for all Angelenos, including the Neighborhood Council Budget Advocates, to comment in the public hearings.
This is an opportunity for Garcetti, Wesson, Budget and Finance Chair Paul Krekorian, and the rest of the City Council to create an open and transparent process. If not, good luck trying to convince already skeptical voters to approve the upcoming increases in our taxes.
(Jack Humphreville writes LA Watchdog for CityWatch. He is the President of the DWP Advocacy Committee and a member of the Greater Wilshire Neighborhood Council. Humphreville is the publisher of the Recycler Classifieds -- www.recycler.com. He can be reached at: [email protected])
-cw
CityWatch
Vol 13 Issue 64
Pub: Aug 7, 2015
