Avedisian Locks in... Savings?

Out of Warwick comes a "tentative agreement" with the municipal unions in which Mayor Scott Avedisian purports to have secured $10 million in savings between March 2009 and June 2012. The dollar amount is measured against the current contracts, expiring at the end of June, and an assumption that a subsequent contract covering the next three years would otherwise have been substantially the same.

The specifics of the "concessions," however, give the impression that the objective is to lock in some very modest changes to help the unions weather the escalating economic storm. Furthering the impression that the taxpayers of Warwick may not be getting the best of deals, here, is the fact that the city council has called for a special meeting on Tuesday night to ratify the contracts, which (according to my sources) will require "unanimous consent" among the councilors, because the required procedure will have been circumvented.

According to a cover letter to the above-linked packet by Personnel Director Oscar Shelton:

... the bulk of the savings comes from increasing health insurance copayments, temporary wage reductions, deferring holiday pay and clothing allowances and from the FOP and Municipal Unions' willingness to reduce their ranks through attrition. The police union is amenable to allowing the City to reduce their force from 180 employees to 163 without filing for arbitration or any other types of litigation. The Municipal Union's workforce will be reduced by at least 12 employees and the Management/Non-union employee Group will be reduced by at least 16 employees (28 total).

The salient points are as follows:

• The health insurance savings come from an increase in the weekly pay-check reduction from $11 for all employees to a whopping $14 for an individual plan and $28 for a family plan, which is minimal to say the least, by current standards.
• The wage reductions vary in significance from one contract to the next:
  • The police will see a 3.25% salary reduction for the remainder of this year (which began, last July, with a 3.75% increase). Unfortunately, my documentation is missing the page that lays out the raise schedule for '09 to '12.
  • The firefighters will see a 5% salary reduction for the remainder of this year (which again began, last July, with an approximate 3.75% increase, although I didn't check the increase for each position). Come July, they'll get that money back as their raise for the first year of the new contract, and then they'll receive a 1.5% increase every six months until June 2012 (equivalent to 2.25% annual increases).
  • Municipal employees will see a 3% decrease for the remainder of this contract year (which began with a roughly 3% raise, although again, I didn't calculate every grade). As with the fire department, a return of that money will be their raise for the '09-'10 year, followed by 1.5% increases every six months.
• In all cases, the deferred holiday pay and clothing allowances are redeemable as paid days off (with clothing allowances converted thereto) — timed, at least, so as not to trigger overtime costs — or as cash payments upon retirement.
• The ability to secure attrition of workforce comes at the cost of no-layoff clauses in the police and fire contracts. (The police contract specifies the current contract period, but as I said, I'm missing an important page.) Moreover, none of the attrition or staff reduction language that Shelton cites is actually in writing within the document that I have.

The most insidious part of the agreement, however, is that it is absolutely contingent upon the city's revenue shortfall. As the police section of the agreement puts it:

In following, the parties hereby agree that should the City become able to partialy or wholly fund the above-referenced Budget Shortfalls for the (current) Fiscal Year ending June 30, 2009 and/or the Fiscal Year ending June 30, 2010 through the receipt or generation of additional revenue through:

(a) its receipt of any reinstatement of or new source of State of Rhode Island State Aid/revenue sharing,

(b) its receipt of any applicable funding from the Federal Government, or

(c) its reduction of applicable costs and expenses from the implementation of any legislatively and unilaterally reduced wages and benefits levels affecting those wages and benefits levels set forth in the parties' current 206-2009 CBA or the successor 2009-1012 CBA (i.e. such as those changes proposed in Article 33, Article 45, etc. of the Governor's proposed Supplemental Budget);

the parties will re-open negotiations concerning the 2009-2012 CBA in order to reinstate levels of benefits reduced in said CBA (i.e. the Holiday Pay and/or Clothing Allowance deferred in the 2009-2012 CBA) in amounts that are commensurate with the level of additional revenue received or generated.

In other words, should budgetary matters turn around in a way helpful to the city, the unions will be first in line for renewal of their money flow. Part C goes so far as to require renegotiation should, for example, the governor and General Assembly implement a statewide minimum healthcare copay; Warwick's savings from that measure would be cycled back to the unions. If only Rhode Island's cities and towns could draft their contracts contingent upon the continuation of short-term market booms and annual windfalls!

As I suggested above, the agreement has an air of union protection in a disastrous and unpredictable time, and the people of Warwick should insist that their elected representatives protect them instead.