Posted by peter carpenter, a resident of the Atherton: Lindenwood neighborhood, on Jul 9, 2011 at 6:50 pm
peter carpenter is a member (registered user) of Almanac Online
Thelma - the most tragis thing that we are seeing in this economic downturn is labor 'leaders' who are not leading but instead are engaging in classic union confrontation strategies.
Here is an example of what can happen with great union leadership:
In the end, Fire Department did its duty — helping the people of Stockton
By Michael Fitzgerald
July 08, 2011
Stocktonians worried the city may careen into bankruptcy can loosen their seat belts. The Fire Department has tentatively agreed to bring its pay and benefits down to earth.
Thanks to Fire's $19 million in concessions, the city overcomes its biggest hurdle to coping with its $37 million deficit. It makes an ominous Fire lawsuit that could bankrupt the city go away, too.
And it makes one of the big structural reforms necessary to permanently fixing the city's ailing finances.
Moody's, are you listening? The city has balanced its budget and probably avoided bankruptcy. Time to throw a little love at our credit rating, baby.
"This is huge," said Deputy City Manager Lori Montes. "This, along with the agreements with the other labor groups. This is tremendous."
Firefighters will swallow a pay cut, retire later and make the same co-pay into their pensions and medical that other public employees do. They will surrender the minimum staffing requirements that were busting the city's budget.
They have, in effect, agreed to share the pain of the recession with their fellow Stocktonians. In return, the city won't use the Big Ax voters gave them when they approved Measure H last November: the power to unilaterally impose cuts should negotiations deadlock.
"We never disputed that this city was in a world of hurt," said Fire union boss Dave Macedo. "We may dispute the numbers. But at the end of the day, we wanted to ... address the concessions that have to be made."
The sacrifices Fire made should not be underestimated. Yes, they were overcompensated. But the staffing cuts, from 75 on-duty firefighters to 51, actually are deeper than those a consultant suggested.
"I feel for the guys," said Macedo. "Some of these guys are young or newlyweds. I had a hard time keeping my eyes dry when I saw the look on their faces."
The agreement also nullifies Fire's lawsuit challenging the city's declaration of fiscal emergency. An arbitrator's pending decision becomes a dead letter.
That is another big relief. Had the arbitrator's ruling further burdened the city, Stockton may well have followed Vallejo and become California's second bankrupt city.
Macedo deserves applause for his leadership. Montes praised him, also several smaller bargaining units.
"We really appreciate what labor has done to help us close the gap," she said. "For them to agree to these changes - we couldn't have closed it without them."
While the news is good, Stockton is not out of the woods.
Stockton Professional Firefighters Local 456 must still ratify the agreement.
Ratification is expected.
Should it not occur, however, the city's fiscal fate will revert to Napa arbitrator Alexander Cohn. After months of hearings, Cohn took Fire's lawsuit under submission last February. He has been taking his sweet time.
The city's fiscal emergency, declared in May of 2010, persists. Fiscal reserves are exhausted. The city projected an $8 million deficit in 2013 and $6 million deficit in 2014.
While those projections will now be revised (deficits are still projected), it is clear that 2011-12, with its $37 million crater, was the crunch.
For Stockton, it gets better from here.
Barring the unforeseen, the city only faces one more fiscal King Kong: the staggering $544 million in employee retirement benefits which previous leaders never bothered to fund. This appears to be the last fiscal giant the city must fight.
It, however, is a long-term problem. The law does not oblige the city to solve it by the end of the fiscal year.
The cuts leaders imposed on retirees under the authority of the fiscal emergency are already reducing that colossal liability somewhat.
The agreement makes it possible to view Stockton Fire as part of the solution - as part of the community, not a privileged elite insulated from taxpayers' struggles.
Welcome to the club, guys. Now serving Top Ramen and government cheese.
"Our profession has taken a beating," said Macedo. "We got our ass kicked last year on Measure H. We got ridiculed for being overpaid. That was a tough pill to swallow. But now it's a new day."
Contact columnist Michael Fitzgerald at (209) 546-8270 or firstname.lastname@example.org. Visit his blog at recordnet.com/fitzgeraldblog.