Hear It On-Demand: Councilwoman Schipske Says City Managers Aren't Currently Paying Their Full Share of Employee Pension, Says All City Employees Should Pay It; Mayor Foster Says City Managers Are In Different Position Than Police/Fire/IAM, Opposes Having Mgrs Take A Pay Cut, Criticizes "Class Warfare Type Stuff"
|(Aug. 18, 2012) -- Should all Long Beach city employees -- or just some -- be required to pay the full employee cost of their pensions?
Taxpayers received newsworthy responses on that issue at the August 14 City Council budget session when Councilwoman Gerrie Schipske raised the issue of LB city managers not currently paying their full employee pension share.
"The fact remains is that they [city managers] only pay 2% of their pension and that if we're asking all employees to pay their full share of the pension costs, I think it's got to be everybody," Councilwoman Schipske said.
City Manager Pat West didn't deny what Councilwoman Schipske said...and indicated that the issue of bringing city management up to other groups had come up in closed session during which the Council "wasn't interested in" providing Councilwoman Schipske's solution:
To do what you suggested, for management to take pay cuts to provide pension pick up, we discussed the severe compaction issues that we're having right now, especially with all the other raises that the other groups have had while management hasn't had a rarise in five years, so that's something we probably need to discuss if that's what you're suggesting.
[Ed. note: Salary "compaction" (which we've seen described as "salary compression") is when employees receive a salary close to what their managers receive. The taxpayer implications of this can be significant, because when city management negotiates union contracts (on behalf of the Mayor and Council) that give pay raises to lower level city employees, those pay raises below create pressure for pay raises above for management (to avoid "compression").]
Councilwoman Schipske replied that when Chicago Mayor Rahm Emanuel took office, among his first actions was cutting his city's management by 10% to balance the budget. Councilwoman Schipske said she isn't suggesting doing this in Long Beach but "I think we have to either explore what you're saying, Mr. West, somehow, but I think we have to deal with it so that every group is on the same page."
To this, Mayor Bob Foster -- who has previously insisted that police, fire and non-public safety unions pay their negotiated pay raises toward their pensions -- responded by stating:
We intend to have everybody pick up their pensions but in fairness, both fire, police and if IAM agrees to pay for their portions with the contracted raises, so it has had little impact on their paycheck, and that's fine...Management is not in that position. We already have compaction and if you're going to ask people to take a 6% pay cut in only one class in the city, I think there's equity issues that I expect you'll start seeing people with talent going elsewhere...This kind of class warfare type of stuff that goes on is very counter-productive. Let's call it what it is. We can thin out the ranks of management, that's fine, but we also have to treat them fairly.
For the record and in the public interest, LBReport.com makes the exchange available
On August 16, 2012, the rank and file membership (with leadership neutral) of LB's local of the Int'l Association of Machinists (IAM, largest LB city employee union) voted not to amend its current City Hall contract to use their negotiated pay raises to cover the full amount of their pension costs. Within hours, City Hall issued a release that quoted Mayor Foster as saying that the IAM's action put "personal gain over serving their community."
The current IAM contract -- which doesn't include pension reform -- was recommended by Mayor Foster and approved by the City Council in May 2008 (7-2, Gabelich and DeLong dissenting). It was a five year contract, instead of the previously usual three year contract...which would have expired by now.
Over ten years ago, LB city managers organized themselves into a collective bargaining unit, a union called the "Long Beach Management Association." It now represents over 350 managers citywide. The LBMA's current contract (MOU) with the City doesn't deal with specific pay for individual managers but covers other terms of employment. Although pension terms for some public safety managers may be slightly diffferent, most civilian LB city managers apparently don't pay the full employee share of their pension at present...which leaves city taxpayers to pay it.
Stated in another way: LB's city managers' union hasn't agreed to the same type of pension reform that Mayor Foster sought from IAM...and received from police, fire and other city employee unions.
LBMA President Joseph Stilinovich told LBReport.com that his union's members as a group haven't received raises (including cost of living) in five years, but has agreed (in principle/on a soft basis) to pension reform by supporting a second pension tier for new hires. He acknowledged the city managers' union hasn't sat down at the table to discuss its current Memorandum of Understanding (contract) with the City but said he anticipates doing so in the near future.
Mr. Stilinovich said LBMA views itself as a partner with the City in seeking to make pension reform work. "We commend what police, fire and the other groups have done to step up to the plate to give back to the City to help solve these issues and we are willing to do the same, but we're not necessarily in the exact same position they're in," he told LBReport.com, adding that LBMA is ready to work with the City to do its share on pension reform but is also concerned with other issues such as salary compression.
On August 14, LB taxpayers head the respective contrasting views of Councilwoman Schipske and Mayor Foster on the subject (and on-demand now, click here).
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Developing...with further to follow on LBReport.com.
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