Mayor Joseph Solomon said Wednesday he wouldn’t be surprised if by the time a fiscal note is prepared on a tentative three-year firefighters’ contract agreement, it shows more savings than the “revenue neutral” plan it is being touted as.
“We highlighted at a minimum what the savings were…tried to take a conservative approach on that. Don’t be surprised if there’s going to be maybe more of an increased benefit cost-wise,” he said.
Later in the interview, Solomon said, “I’ve done it my way. My way is something that has been unheard of and hasn’t occurred in 20 years…For the next three years, it’s cost neutral. I’m very proud of a neutral cost three-year contract…I put that up against any other community or any other individual, even in the private sector. There’s no cost increase. There’s over a $450,000 savings in the first year.”
That’s not the way some people see the agreement as based on the administration’s press release and what’s been reported.
City Council President Steve Merolla said Wednesday the issue for him is not salary increases – the agreement calls for no increase the first year and two-percent increases in each of the next two years – but rather whether the contract addresses the future costs of retiree benefits that are consuming more and more of the operating budget to the detriment of infrastructure improvements, services and higher taxes.
Ken Block, a former Republican candidate for governor, Warwick businessman and critic of generous firefighter benefits, was especially critical of the administration’s intent to drop the appeal of the arbitration award finding firefighters hired after July 1, 2015 are not part of the Tier II pension plan applied to police and municipal employees. Under the tentative agreement, firefighters hired after July 1, 2019 would be in the Tier II plan with its reduced benefit package.
“The cost of this is way more than $2.8 million,” he said. “It doesn’t include future costs.”
Block called the agreement a “complete capitulation” to the union. He contends gains touted by the city are “stuff nibbled away while they willingly gave away” much more.
Rob Cote, who has done an extensive review of pension and post-employment legacy costs and presented his findings at a public meeting at the library, likewise was critical of the agreement to drop the appeal of the arbitration ruling. As the city has lost the ruling, he questioned what more could they lose by pursuing court action.
So far, however, the tentative agreement hasn’t been made public or provided to the council that will get to vote on it.
Solomon said Wednesday the agreement and an accompanying fiscal note would be made well in advance to council consideration. In addition, once ratified, he said the agreement would be available for public review.
“We did that with police, we did that with municipal, we’re going to do that with fire. If it’s ratified by the council, it will be executed in the same manner and it will be a public document on file in the clerk’s office,” he said.
In addition to new provisions of the contract, Solomon said the administration went through the entire contract cleaning up ambiguous language and terminology.
“I am very, very proud of what we were able to accomplish, and it’s just the beginning because I think it establishes a direction of the city and its employees working together to address a lot of the issues that have to be addressed to sustain ourselves on both ends. And I think that’s important, and it also sets the tone or gives ideas for future contract negotiations,” Solomon said.
If approved, for the first time the agreement would create a municipal OPEB trust fund that would be funded by firefighters hired after July 1, 2019. Under the proposal, the new hires would pay 2 percent of their salary to the fund. On retirement, the money would be used to offset the cost of health care and other benefits exclusive of their pension. According to the city’s calculations, the fund would pay for 27 percent of the cost of the benefits. The taxpayers would cover the balance.
Under the agreement, firefighters would give up two paid personal days, one holiday and four sick days for a total of 16 sick days. They would also agree to a two-year period between the elevation in grades between a starting Grade 3 and Grade 2 and Grade 2 and Grade 1. Currently, starting firefighters move through the grades annually. The agreement would also establish a 24-hour shift without altering the current 42-hour workweek.
Asked why the city would drop its appeal of the Tier II arbitration award at a potential cost of $2.8 million, Solomon said, “I don’t remember what the figure was. There was a cost involved, and that’s a cost that we’re going to have to sustain. But going forward, that issue has been resolved. All new hires will be paying in more, all new hires will be working longer before they qualify for benefits.”
As for the issue of legacy costs, the mayor said, “Those are all predicated on assumptions. A lot of those assumptions have been eliminated with this new contract that results in a cost reduction, if you base it on the assumptions some were basing it on. No one can predict the future, but you can be assured that the future’s not going to be how things existed in the past. It is in flux, it is changing, and it’s being done through negotiations to address what financial demands may be required in the future, to mitigate those demands or mitigate those costs.”
Solomon reiterated his confidence in the agreement and what it means for the city and his appreciation to those who put it together.
“It shows a willingness to work together, and that’s the direction that I plan on approaching with every bargaining group that I have to deal with. And I hope they share the same attitude,” he said.
Block was pleased to learn that Solomon intends to make the tentative agreement public before the council meeting.
“If it is released days in advance, that’s a huge positive step for the city,” he said. “It should happen. I’ll throw tons of roses at this administration.”