City Labor Deal Close

Union deal is expected to cut deficit in half

Updated 10:00 AM PST, Fri, Oct 30, 2009

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The City Council is poised to approve three separate labor deals today that would cut its $405 million deficit in half this fiscal year without layoffs or furloughs, according to officials.

An Early Retirement Incentive Program aimed at shedding 2,400 civilian employees from the payroll would save $20 million from the city's general fund, plus another $155 million from the budgets of Los Angeles World Airports and the Port of Los Angeles, according to officials.

New contracts with the Coalition of Los Angeles City Unions and the Los Angeles Police Protective League are expected to save $158 million next in fiscal year, according to officials.

Under the proposed contract, coalition members would work 3.5 fewer hours per pay period through the remainder of this fiscal year. They would also put off collecting two years' worth of pay raises until after 2011, according to officials.

Those who want to voluntarily work a 72-hour schedule would be allowed to do so this fiscal year.

The coalition also agreed to transfer some members to programs and departments whose budgets are separate from that of the city. These include programs funded with federal and state grants, the Port of Los Angeles, and Los Angeles World Airports -- but not the Department of Water and Power.

Aside from canceling layoffs and furloughs, the city agreed to give coalition members two cash payments averaging about $1,300 each.

Meanwhile, members of the Los Angeles Police Protective League agreed to forgo salary increases this fiscal year and the next. They also agreed to allow the majority of overtime and sick leave to be compensated with time off rather than cash.

The proposed contract also states that police officers hired next year will be paid 20 percent less than the current starting salary.

City Administrative Officer Miguel Santana said the city will save $58 million from the contract this fiscal year, and $104 million next year.

Under the ERIP, employees would be allowed to retire up to five years early with full benefits plus $15,000. They can sign up for it starting Monday through Dec. 16, or until the maximum number of participants has been reached.

The program will be offered on a first-come, first-served basis, and will cost the city nothing. Employees who stay on the job agreed to increase their pension contributions by 1.07 percent beginning July 2011 to pay for the early retirees' incentives.

Employees who take advantage of the ERIP must pay 1 percent of their retirement benefits into the pension fund.

The Coalition of Los Angeles City Unions negotiated the deal and estimated the ERIP and the coalition contract combined would save the city $1.17 billion over five years.

About 6,300 members of the Engineers and Architects Association must agree to take a total of 26 furlough days this fiscal year after their negotiators refused to defer their cost-of-living increases, according to city officials.