Effect of new agreements is a 3 percent decrease in pay

Many city employees and department managers have agreed to new contract terms that amount to a 3 percent pay cut.

Under updated agreements with both employee associations, the workers will begin paying the member contribution for the Public Employees Retirement System - something the city had traditionally paid - starting July 1, said Crescent City Manager Eugene Palazzo.

A 5 percent cost of living adjustment will also take effect on July 1, but the member contribution to PERS amounts to 8 percent of employees' pay, Palazzo said.

"They're going to pick up the 8 percent PERS and be getting a 5 percent (cost of living adjustment), but they'll be bringing home 3 percent less," Palazzo said. "This will assist the city in balancing the budget."

The City Council unanimously approved a memorandum of understanding between the city and the Crescent City Employees Association on Monday as part of the consent agenda. The Council had approved a similar agreement with the Crescent City Management Employees Association on March 18.

The current MOU between the city and both associations expired June 30, 2012. Officials estimate that the city will save about $60,000 during the term of both new MOUs, which end June 30, 2014.

Up until July 1, the city had paid a total equal to 23 percent of each employees' salary into PERS, Palazzo said. This included the 8 percent employees' contribution and the 15.32 percent employers' contribution, he said. But changes to the retirement system at the state level will have all public employees paying their contribution by 2018, Palazzo said.

Palazzo said when the city went into negotiations with the two employees' associations, he offered to have them phase in the change over time rather than hit them with the 8 percent payment all at once. The associations chose to take it all at once, he said.

"We could have phased it in over a couple-year period, but (the two associations) chose to take it all at once if the city gave them a 5 percent COLA," he said.

The Crescent City Employees Association represents miscellaneous employees including mechanics, building and grounds maintenance workers, meter readers, water and sewer operations technicians and lab technicians.

The Crescent City Management Employees Association represents the engineering technician, the pool technician, the water quality laboratory director, information systems administrator, the associate planner and the public works manager.

The city is still in labor negotiations with Clerical Employees of Crescent City and the Police Officers Association. Palazzo declined to go into detail, but said negotiations should be finished by the end of the fiscal year.

During public comment Monday, former City Councilwoman Donna Westfall asked if there would be any cost-of-living increase and claimed the county took a 13 percent pay cut across the board.

"I'm wondering why the city didn't," she said.

County Administrative Officer Jay Sarina said this week that miscellaneous county employees, appointed department heads and elected department heads have had their pay cut by approximately 4 percent from fiscal year to fiscal year for multiple years.

"If you go back enough years, the answer's probably yes," he said, referring to whether county employees have taken a 13 percent pay cut across-the-board. "Obviously we'll go into a season where we're hoping we don't have to take any type of concessions or cuts, but a lot of it is just dependent on revenues and expenditures."

County employees took 10 unpaid furlough days this fiscal year. There are no more furlough days planned for this fiscal year, Sarina said.

City employees do not take unpaid furlough days, Palazzo said.

"Applaud two associations that have come to the table and worked with us," Palazzo said, adding that he has been trying to keep from instituting measures like furlough days and layoffs partly as a way of avoiding interruption in city services. "It's a really good solution to where we're at with the budgets."

Reach Jessica Cejnar at jcejnar@triplicate.com.