GLENDALE, CA--(Marketwire - June 30, 2010) - In the midst of continued City budget challenges, negotiators representing the City of Glendale and Glendale Fire Fighters Association (GFFA) have engineered a contract that takes an unprecedented step towards addressing the rising cost of pensions. GFFA members approved the tentative agreement that calls for no salary increases for three additional years, after having already given up a scheduled raise in July 2009; an increase in employee contributions for pension benefits; and a new tier of retirement benefits for future employees. If approved by the Glendale City Council, the Memorandum of Understanding (MOU) will be effective July 1, 2010, through June 30, 2014.
"The City of Glendale and the Glendale Fire Fighters Association today announced an unprecedented Memorandum of Understanding that re-negotiates a new four-year salary and benefit agreement," said Glendale Mayor Ara Najarian. "As many municipalities nationwide struggle to balance their budgets, the willingness of the GFFA to work closely with the City during this fiscal crisis illustrates the commitment that this organization has to the community it serves. The estimated cost savings to Glendale over the next four years will be well over $2 to $3 million dollars. More importantly, the agreement means we will be able to continue our current level of outstanding services to our City without experiencing station closures, furloughs or brownouts that have impacted some of our neighboring communities."
"Like most major cities, Glendale is facing significant budget challenges. We asked our employee unions to work with us in a spirit of cooperation. The firefighters were the first to step forward," said Glendale City Manager Jim Starbird. "The Association recognized the urgent need to control costs without impacting our high level of service, at a time when other municipalities are being forced to make drastic cutbacks. The salary and benefit agreement that has been reached is advantageous to all parties -- the City, the firefighters and the community."
The Agreement replaces an already existing contract that would have terminated June, 2012, and includes the following provisions:
- It will waive and forgo a previously negotiated salary adjustment due to occur July 1, 2011.
- It waives all scheduled salary adjustments from July 2009 to July, 2013.
- It will increase the amount employees contribute as cost-sharing to the PERS pension plan from 1.5% to 2% effective January 1, 2011. Glendale is already one of the few cities where employees contribute to their retirement pension plan. Currently firefighters pay the 9% employee's share of the contribution and 1.5% of the employer's share. This agreement will raise the firefighters' contribution to the employer's share from 1.5% to 2%.
- It puts in effect a second tier of retirement for all new hires after January 1, 2011, raising the current PERS retirement age from 50 years to 55 years. This restructuring of the PERS pension formula will lead to significant reductions to the costs of the City's future pension obligations for firefighters. Very few public agencies at this point have taken this important step toward sustaining the viability of public sector pensions.
- It also includes a sick leave credit to the Retiree Health Savings Plan for those firefighters retiring through December 31, 2012.
"It is obvious from this resolution that the men and women of Glendale's Fire Department have recognized the critical nature of our economy and the financial constraints under which the City is operating," said Chris Stavros, President of the Glendale Fire Fighters Association (GFFA). "We greatly appreciate the commitment to staffing and the support of competitive compensation that the City Council and City Management have provided us. The members of the GFFA feel that it is important to get through this crisis together through a willingness to cooperate."
The agreement has been reached following negotiations between the City and the GFFA and may become an example to other cities that are facing the same economic restrictions. The sworn fire managers represented by the Glendale Management Association (GMA) followed suit and have planned to adopt the same provisions in their Memorandum of Understanding. The City Council is scheduled to vote on the tentative agreement on July 6, 2010.