Budget Review Committee

BUDGET REVIEW COMMITTEE OCTOBER 21, 2013 A meeting of the Budget Review Committee was held Monday, October 21, 2013 at 7:00 p.m. in the Aldermanic Chamber. Alderman-at-Large Brian S. McCarthy, Chair, presided. Members of Committee present: Alderman-at-Large David W. Deane, Vice Chair Alderman-at-Large Mark S. Cookson, Arrived after Roll Call Alderman-at-Large Jim Donchess Alderman-at-Large Lori Wilshire Alderman Mary Ann Melizzi-Golja Alderman Richard A. Dowd Also in Attendance: Stephen M. Bennett, Esq., Corporation Counsel John Griffin, CFO/Comptroller John Seusing, Chief of Police Thomas Pappas, Police Commissioner Alderman Deane Mr. Chairman, I believe Alderman Cookson stopped at the Amherst Street Elementary School because there’s that public meeting on the Broad Street Parkway this evening. It started about a half an hour ago so he’s probably going to be a little late. Chairman McCarthy Alright. Alderman Melizzi-Golja I will make a note in the minutes too. Thank you. PUBLIC COMMENT COMMUNICATIONS From: Mayor Donnalee Lozeau Re: Resolution R-13-145, Cost Items of Police Supervisors Union Collective Bargaining Agreement MOTION BY ALDERMAN DEANE TO ACCEPT AND PLACE ON FILE MOTION CARRIED UNFINISHED BUSINESS – None NEW BUSINESS – RESOLUTIONS R-13-145 Endorser: Alderman-at-Large Lori Wilshire Alderman-at-Large Barbara Pressly Alderman Richard A. Dowd APPROVING THE COST ITEMS OF A COLLECTIVE BARGAINING AGREEMENT BETWEEN THE NASHUA POLICE COMMISSION AND THE NASHUA POLICE SUPERVISORS ASSOCIATION FROM JULY 1, 2011 THROUGH JUNE 30, 2015 AND AUTHORIZING RELATED TRANSFERS Budget Review – 10/21/13 Page 2 MOTION BY ALDERMAN WILSHIRE TO RECOMMEND FINAL PASSAGE ON THE QUESTION Chairman McCarthy Attorney Bennett, do you want to run us through the changes in the contract? Attorney Bennett I’d be glad to start off. The cost items begin with Article 10, which is the vacation provision. The only change in that article is that an officer with 15 years of service would be entitled to 25 days vacation. It was 16 years of service to get 25 days vacation. Alderman Dowd Do you know how many members of the bargaining unit have over 15 years? Attorney Bennett I don’t. I would suggest in this bargaining unit, I would think the majority would as they are sergeants and lieutenants. Chief Seusing I don’t have that number, at least 50 percent, but I can certainly get you that number. I don’t have that with me right now. Attorney Bennett The next provision is insurances, Article 14. The changes here are that the union would effective October 1, 2011, increase their contribution for the HMO to 20 percent and 30 percent for a Point-Of- Service plan. October 1, 2011 is the date that the other unions with new contracts have agreed to begin paying premiums. Alderman Donchess What was the date again? Attorney Bennett October 1, 2011. Effective upon signing the agreement, the union members will pay the increased deductibles and copays along with the pharmacy benefit which is the same plan that all the other unions who have new contracts are on and merit. One of the provisions that is being removed is the named insurance carriers. This union and I believe patrol were the two unions that still had named providers in their contracts. They have agreed to remove those named insurance carriers. We also redefined what is a comparable plan in regard to what benefits are offered. If the city were to change plans because one plan wasn’t being offered anymore it would have to be a comparable plan to what we now provide. That’s set forth in the explanation. Finally the members have negotiated to have a setoff towards their retro premium payments. Those are sizeable retros. I think there’s some up around $5,000 per member. As a setoff of that amount, they would contribute or return to the city accrued sick days up to Budget Review – 10/21/13 Page 3 the amount of the retros that they owe. They are required to maintain at least 40 hours of sick leave and can’t go beyond that to pay this off. Should there be any remaining balance due on the retros after contributing sick days that would be paid off from weekly deductions. There is no requirement that they do this. The number of sick days which they would turn back to the city is voluntary and it’s up to them. Chairman McCarthy What valuation is placed on the sick days in terms of the offset? Attorney Bennett The value would be determined on the date of the signing of the contract. Chairman McCarthy And it’s whatever their hourly rate is? Attorney Bennett Whatever their hourly rate is or daily pay. Alderman Deane I had a question on the cost analysis. On line 39, when you look at the out years, 13 was $637,635. Then it bumps up to $826,131. That’s all due to change in what the state’s requiring us as a community to contribute? Mr. Griffin That’s related to two items. One is any wage increase coupled with the increase from the New Hampshire Retirement System percent. Alderman Deane What’s the total amount of that change in the wage increase with the contract? What’s the state requiring us to put in on top of that? Mr. Griffin If we look at that same line, Alderman Deane, line 39, the employer portion is risen from 19.95 percent to 25.3 percent. That’s on every dollar of wage so that’s the lion’s share of that increase. Chairman McCarthy Are you talking about the analysis that has to do with the healthcare? Alderman Deane No, I’m talking about the analysis that’s given to us with the contract. Budget Review – 10/21/13 Page 4 Chairman McCarthy I’d like to get through the changes in the contract. Alderman Deane Oh, okay. Attorney Bennett The next cost item is Article 16, educational benefits. There’s a negotiated $250 increase effective 7-1- 11. If you have the sheet of the summary that was prepared, members who have an associate’s degree would receive a $500 annual benefit. Those with bachelor’s degrees a $1000 annual benefit and those with a master’s degree or higher a $1250 benefit on an annual basis. Chairman McCarthy How many employees do we have in this group that applies to? Chief Seusing I believe it’s nearly 80 percent, about 25 of the 32 I believe. Alderman Dowd I didn’t quite hear your question. Did you say how many have a degree? Chairman McCarthy Ya. Alderman Dowd My question would be how many have multiple degrees? Chief Seusing That does not apply here. They don’t get additional benefits if they have multiple degrees. Alderman Dowd Okay. Chairman McCarthy There’s three different levels for associates, bachelors and masters. How many do we have that have master’s degrees? Chief Seusing I don’t have that in front of me. I don’t know if you do, commissioner? Budget Review – 10/21/13 Page 5 Commissioner Pappas No. Chief Seusing But I believe 25 of the 32 do have one degree or another. Some have multiples but again they don’t benefit by having more than one degree. Alderman Dowd Do the degrees have to be something that can be utilized by the police department or is it any bachelor’s degree? Chief Seusing It could be any bachelor’s degree would be eligible for that benefit. However getting reimbursement if you’re going to school as far as getting a tuition reimbursement that would be more limited. Attorney Bennett The next cost article is 19, bereavement leave. The only change there was increasing from three to four paid bereavement days and that’s in the instance of the passing of a parent, spouse or child. The next article is 28, wages. It’s a four-year contract starting in FY12. In FY12, a lieutenant would receive a two percent increase and a sergeant a one percent increase. That is in part designed to make sure that there is a cost difference between the two positions, either a sergeant or a lieutenant. In FY13, both lieutenants and sergeants would receive a one percent increase. FY14, lieutenants and sergeants receive a 2.2 percent wage increase. FY15, the increase across the board is 2.5 percent. The last one is the duration which I just mentioned is four years back to FY12. It would be from July 1, 2011 through June 30, 2015. Chairman Wilshire I’m going to support this obviously because I sponsored it, but I think there’s a lot of good things in this contract. For many years now we’ve been asking the unions to remove the named carriers which I believe is a benefit to the city. All along we’ve been asking for that concession because it allows us to shop and to get lower quotes than from the named carrier. I think that was good that they negotiated that. Using sick leave to pay the retro and the balance if there’s not enough in their sick leave will come out in weekly deductions like it does some other unions that are paying that back. But they are paying it back. I think, too, with using the sick days at today’s hourly rate now if they retire five years from now that hourly rate is going to be higher. It would cost the city more. I think that is somewhat of a savings to the city too based on the hourly rate at the time this contract is signed. I like the fact that it’s a four- year agreement. I think they did a really good job on this, and I’m going to be supporting it. Thank you. Alderman Dowd Is there a cost associated with the fact that they’ve given up the named carrier? I assume that’s got to be a cost benefit to the city. Budget Review – 10/21/13 Page 6 Chairman McCarthy Not immediately. Alderman Dowd Maybe not immediately but ultimately if they were able to select a carrier that charges a lot more. Chairman McCarthy Quite frankly right now the interesting thing about changing the named carrier provision is the stuff that’s going on with Anthem and Southern New Hampshire. If we have Anthem administering our plan, they’re spending our money. We’re not using their insurance but it’s their backend agreement with the providers that allows us to give service to them. Anthem has decided that on at least a number of their plans they will no longer allow participation through Southern New Hampshire Medical Center or any of its associated doctors which may in fact require us to drop that network entirely from the coverage that we offer unless we can shop that carrier around to someone who still does business with Southern New Hampshire. I don’t know exactly how all that plays out, and I’m not sure anybody does because there’s a mass of agreements in place there but it may well be that that provision is of great value to both sides depending on how that situation falls out. I don’t think any of our employees want to have to go hunting for new doctors because the named carrier is in there when without it we can go find a carrier that is much more suitable to the needs of the employees. Alderman Donchess I’m supporting the passage of the contract as well. I think the Mayor’s objective of consistency and fairness is an objective we should pursue. But as I look at particularly information that was prepared at the time of the last budget when Mr. Griffin, he probably remembers because he must have put in a ton of work here, prepared a whole series of chart which analyzed where various employees stand and the raises that they have gotten over a period of four years and a lot of other questions. Mr. Griffin prepared this at the time we were questioning whether merit employees were getting more than other groups. As part of Mr. Griffin’s analysis there is a Table C which provides the pay increase levels over a period of four years for basically every employee group in the city. This includes FY11, FY12, FY13, FY10, so 10 through 13. What is shows really the police supervisors here would be, if this contract were passed, in terms of their wage increases will be in line with or even a little less than other employee groups. Over the course of this four-year contract they would be getting 6.7 percent which is roughly between 1.6 and 1.7 percent a year over four years. It’s a slightly different four years than we’re looking at in the chart but over the four years in Mr. Griffin’s chart the average AFSCME employee, in other words public works, received 3.4 percent over four years. The AFSCME workers are getting over one four-year period double the wage increases that the police supervisors would be granted over this four-year period were we to pass this contract. Similarly merit employees over a four-year period received 2.3 percent over a four. That’s the average. The top merit employee actually got 4.7 percent over four years and the bottom, the lowest merit employee got 2.1 percent over four years. Again the police supervisors would be getting less than the lowest merit employee. A slightly different four-year period. In addition to all that if we plug these numbers which is one and one into this four-year period that was analyzed by Mr. Griffin, again the police supervisors would be at 1.7 percent, near the bottom of all the other employee groups. If we are really going to apply the consistency and fairness approach, how can we even consider turning this contract down for wage increases which is the biggest cost associated with a collective bargaining agreement? They’re in sort of the lower middle or even nearer the bottom. It’s been pointed out, I think Budget Review – 10/21/13 Page 7 in the mayor’s letter, that they would be paying back the retro. The police in this union have agreed to the same health care concessions the other employee groups have made. Looking forward that is a very important concession for the city to obtain. The only issue is the retroactive and how is the retroactive going to be paid. The proposed agreement says they can use sick days but my recollection is that other employee groups, and it is varied, some were able to give up educational incentives and pay for it that way. There’s been various arrangements that have been made. Looking at these various raises that other employee groups have gotten, this seems in line or even a little below what other employee groups have gotten. We are facing a time when I think we want the morale of our police officers to be high because of events within the community. I just don’t see how we could turn this down and have police officers look. I’m sure they have all this information or they are aware of all of this. They would say: “What’s wrong with us? Why can public works get 3.4 percent a year and we can’t get 1.7?” So for all those reasons I believe that we should pass the contract as proposed. Chairman McCarthy Alderman Deane, did you want to re-ask your question on the contract analysis? Alderman Deane Ya, can I? Chairman McCarthy Yup. Alderman Deane Thank you. There’s a bump of about $188,500 between ’13 and ’14. Chairman McCarthy Which line item? Alderman Deane Thirty-nine, I’m sorry, under retirement costs. As Mr. Griffin had stated it went from 19.95 in 12 and 13 to 25.30 in 14 and 15. When you look at the lift in that, in 12 it goes from $631,000 to $637,000. You’re looking at about $6500 for the year with that one percent. Then it ramps up to $188,000. Granted there’s an increase of 2.2 percent of wages, 1.2 percent above the prior year, but of that $188,496 what portion of that is due to the fact that the retirement system percentage increased from 19.95 to 25.30? Mr. Griffin The $69,175 total is all pensionable. $17,500 of the $188,000 is attributable to the wage increase. So the difference between $188,000 and round it off to $18,000, $170,000 of it is due to the increase of the employer contribution rate. Alderman Deane So $170,000 of the $188,000 is because of the change in the contribution that’s required. Budget Review – 10/21/13 Page 8 Mr. Griffin That’s correct. Every other year they’ve had pretty sizable increases. Alderman Deane What number billion are they at unfunded liability now? Mr. Griffin I’m not sure at this point. I don’t have that in front of me. Alderman Deane I’m glad I’m not depending on that system to provide me with my retirement because I don’t know what’s going to happen with that but eventually all the rocks are going to fall. It’s happened in other parts of the country where their pension plans, there’s no money. People paid into it and this plan has a huge unfunded liability right now. A lot of people are paying into it; a lot of communities are paying into it; and, a lot of people are anticipating using it as a portion or all of their retirement. I wouldn’t want to be having any of my apples in that basket. Chief Seusing First of all I just wanted to thank the Board members present this evening, and you, President McCarthy, for allowing me to talk for a couple of minutes about the importance of this contract. The first thing I wanted to mention is I know the Mayor had indicated in her letter, which I’m going to speak a little bit about here in a few minutes, that there really wasn’t a significant difference between the contract that came down this time versus the contract that was down here several months ago. There isn’t a significant difference, but I wanted to comment on the reasons why. After the last contract was rejected, I met with and spoke with most everyone from the entire board, but in particular the members who rejected the contract last time around. I had some very in-depth discussions with them about why they rejected it. We had a very good discussion, we all did, and it was clear to me that many of the aldermen after our discussion had a much better understanding of the benefits of this contract and why it was important to pass the contract the way it was. We spoke about the health care concessions; we spoke about the fact that this union was in fact paying health care retro back from the day that all other unions were asked to pay for it. We also spoke at length about the fact that this union and the patrol union were the only unions that were asked for additional health care concessions. No other union was asked in this round to give up additional health care concessions but our unions were, namely, the named carriers. In the supervisor’s contract back then and in front of you today, they’re giving up those named carriers. The importance of giving up those named carriers was talked about here a few minutes ago. But after that discussion it was clear to me, and frankly many of them told me that had they had this clear understanding they would have approved the contract as it was five months ago. So it’s for those reasons I did not go back to the union and ask them to reduce the wages that were on the table. I didn’t do that because it was clear to me that the aldermen that I spoke to felt it was reasonable. I also felt it was very reasonable. I say that because when you look at the four-year comparison and as we know the difference between this contract and the last contract besides the reduction in the personal days, which brings it back in line to what it has always been, was the additional fourth year. When you look at this four-year contract compared to a four-year contract, and when you look at the same years compared to a contract that has recently come down before you, it’s clear that when you look at those percentage increases they are absolutely in line with other contracts. If you look at a different four-year period as Budget Review – 10/21/13 Page 9 Alderman Donchess spoke about, it’s very easy to understand that those percentage increases are absolutely in line with other contracts that have come before this board. If you look at the last two years of this contract, namely Fiscal Year 14 and 15, I think that you will see that those two years will actually be a little bit less than other Fiscal Year 14 and Fiscal Year 15 that come before this Board. As was mentioned earlier, the majority of this union are only getting a one percent wage increase the first two years. The other unions that have come before you that have already been approved, those unions received between .5 and a .8 and the majority of these union members are getting a 1 percent pay increase. I think the most important thing I’m asking the members of this board to keep in mind is the concessions which I spoke about. All union members in the city were asked to pay an additional ten percent to pay retro back to October of 2011. They were planned designed changes as well, co-pays and deductibles. Every union in the city has agreed to that to include the supervisors. But in addition to that the supervisors and the patrol were also asked for the named carriers. That was an additional concession that they were asked to give up, and they gave it up. Now I will say the other unions did not have the named carriers in their contract because at some point in time in the past they probably negotiated those out. I have no idea what maybe they got in return when they negotiated that out, but the fact of the matter is when those were negotiated out from the previous unions in previous contracts it was really a moot point to some degree because as long as one union had the named carriers in their contract they all benefited from it. Our two unions, supervisors and patrol, are well aware that when they give up the named carriers, and again the supervisors are willing to do that and that is on the table with the patrolmen’s union, they know that once those named carriers are out of the contract there is a chance that the named carriers that they currently have and I think we would all agree that our health plan is probably the most important benefit to any city member here, that they know that once they give that up, there’s a very good chance they might have to go to another named carrier. The other unions didn’t have to worry about that because they were already in these contracts. These two unions know that once they give it up, it’s gone and that is significant, I think, to consider when you consider this contract. I think also what needs to be considered is the potential for significant savings with the named carriers out. It’s going to allow the city to go out to bid. I don’t have a dollar figure as to what the savings are going to be and I know Alderman Dowd asked that question, what kind of savings are we going to see, and I suppose one never knows, but I think it’s pretty clear that the city would absolutely benefit from that as well as all the other city employees. I think that absolutely needs to be considered. The other thing that I think is a little noteworthy to mention is that when we met with the supervisors’ union and we asked them for the named carriers, they knew how significant that concession was. I can tell you right now they absolutely did not hold the city hostage in asking for an extravagant pay increase for that concession. If you look at the four years that are on the table and if you look at the three years that were on the table previous to this contract, they were absolutely in line with all the other unions that have come before you. This union, in addition to agreeing to pay the additional ten percent and pay retro back to day one, is also giving up the named carriers. I’m asking you to please remember that when you vote on this proposal. The last thing I wanted to point out was the mayor’s letter that I know you all received. A couple of things in that letter I just wanted to touch on. I really don’t mean to repeat myself because I know we were down here five months ago talking about this, and I know I’m repeating myself from back then but I think it’s critically important that I do that. In her letter she talks about her being upset because the wage increases in this proposal are not in line with other city contracts. That’s in her letter as we all know. I think it’s crystal clear based on what Alderman Donchess said and what I have said that is not the case at all. You just have to look at the numbers. She also talks about the college incentive. She talks about a $500 lump sum that the members of the supervisors’ union will be receiving upon the signing of this Budget Review – 10/21/13 Page 10 contract. Well the $500 lump sum is actually retro payments of that incentive. I think that’s noteworthy because it was mandated that our union pay retro healthcare from day one. I think it’s only fair that they also receive retro payment in any wage increases. It’s not just a $500 lump sum payment. It’s a retro payment that they are receiving. I think if you take anything away from that that was written in her letter that you all received was that we have a very highly educated supervisors’ union. Nearly 80 percent of our supervisors have college degrees, many of them have advanced degrees. You really can’t put a value on education, in my opinion, and you certainly can’t put a value on education in the supervisors’ union. These are the men and women that are responsible for supervising the younger men and women of the largest union in our department who are actually our first responders. The ones that are responding to everything that we’ve talked about this summer. Supervision is critical and having a highly educated supervisory staff is most important to myself and to the police commission. If I take anything away from what she wrote in that letter is that we have a very highly educated supervisory staff, something that we should be proud of. She also mentions in her letter that she’s very upset that this union has not paid the same addition in co pays and deductibles as the other members of the city, the other city contracts. That is true. However I think what you need to keep in mind is that no other union that did not settle immediately was asked to pay back any retro payments in co-pays and deductibles. Not one. Our union wasn’t asked to do that either. In complaining that they’re not paying these payments and asking you to reject this contract doesn’t make any sense to me because you can’t have it both ways. Our members of our union can’t pay the additional on co-pays and deductibles until the contract is approved. So in one breath she’s asking you to reject this proposal but in the same breath she’s saying she’s upset that they’re not paying the additional co pays and deductibles. If this was approved five months ago, they would have been paying them. Lastly in regards to her letter, she talks about the sick time option and that she’s very upset that our union is being given the option to pay back the health care retro using sick time. I’m very perplexed and I’m very angered by what she said in that letter, and I’ll tell you why. This option was spoken about in- depth with Attorney Bennett. I had asked him on more than one occasion and it was made very clear to me when we spoke that this option was fine with the mayor. For her to put in her letter three days before it comes down before you and before the full Board and say that is not an option that she agrees with, that is an unfair option and to call this contract worse than the other contract is absolutely unfair to this union. We never would have put that as an option on the table if we thought the mayor would say what she said about that as being a viable option. We never would have done that. The last thing that I’ll say on behalf of the men and women of the supervisors’ union, they’ve been without a contract for two and a half years. Two and a half years. I can tell you there is no doubt in my mind, not one, that in that 2 ½ year period, they remained as professional, as dedicated, as loyal and committed to this city, to the police department and to the community as a whole as they were from day one. Not one time during this 2 ½ years knowing that they didn’t have a contract did they falter one iota, not one bit. To me that’s most noteworthy. I think that is a sign of their professional and in my opinion speaks volumes about how important this union is to this city. When I spoke with most everyone in this room and most of the board members about the importance of this contract to this city and to the police department and clearly it is very fair, it is very reasonable and it absolutely benefits this city. I’m asking you for your approval. Thank you. Alderman Cookson I’ll pick up where the chief left off and I’ll address my question through you to Attorney Bennett. I’m just curious about Chief Sensing’s statement about the sick pay being a viable option. I’m assuming that you Budget Review – 10/21/13 Page 11 either 1) brought that option or brought that news of sick pay being an option. Did you bring that back to administration? Attorney Bennett Do you want a full answer? Alderman Cookson I’d love a full answer. Attorney Bennett I met with the commission and Chief Seusing on August 1st. The option of sick time as a way of paying off the retro was discussed and approved by the commission. I was asked to run that by the mayor. The mayor is not part of the negotiation team and I don’t run options by the mayor when I’m negotiating generally. I understood why they were asking and I went and I asked the mayor if she would have a problem with using the sick time as a way of reducing the amount of money owed. Subsequently we wrote up the article. I did not sit down at the table with the supervisors. I didn’t discuss it with them. I was asked to do the article, and I did that. I did not run the article by the mayor. I didn’t tell the mayor that they were going to pay for all of it with the sick leave. I just asked her if that was a viable option. Similar to the personal days that AFSCME gave. That was the extent of the discussion. Alderman Cookson So you posed the question to the mayor: Is this a viable option. Did you ever receive a response back from the mayor? Attorney Bennett At that point that’s all I asked for and she said that it was a viable option. But again I didn’t review the article with her or tell her that it wouldn’t be any cash payments. To be fair to the mayor on that and to be fair to the chief on that, I think I could have been cleared to both the mayor and the chief on what the discussion was. For that issue that I’ve raised between the mayor and the chief, I’m sorry. But that was the discussion with the mayor. Alderman Cookson That’s a conversation that took place over the last two months. Again you said it was right around the beginning of August that this dialogue started again? Attorney Bennett With the commission. Alderman Cookson Alright. Then I had a question for the chief. In your comments to us you were discussing about this $500 lump sum payment that the mayor has addressed in her letter. You said it’s retro pay for the educational benefit. Is that correct? Budget Review – 10/21/13 Page 12 Chief Seusing That’s correct. Alderman Cookson And that payment would only be provided to the individuals within the union who took advantage of it since July of 2011, correct? Chief Seusing That had a college degree, yes. Alderman Cookson Based on the charts that Alderman Donchess provided earlier, they were Mr. Griffin’s chart, Alderman Donchess made reference to several of the unions, in particular fiscal years having percent increases, and then at the end of whatever that time span, Alderman Donchess That was 10 through 13 Alderman Cookson Ten through 13, at the end of that particular set of fiscal years, there was an average increase. My question comes about the calculation. Do you recall whether that average increase is based on a compounded increase of salaries year over year or is that just a straight, this is 2 percent, this is 3 percent and it averages out to 2 ½ percent? Mr. Griffin Subject to check, it was the sum of the percent increases divided by the number of years. Alderman Donchess I think Mr. Griffin’s recollection is correct. That is how the chart reads. Alderman Cookson So in all of these calculations whether it’s the charts that are created or whether it’s the charts that are provided in the analysis, those are not compounded. Those are strictly percent increases for that particular fiscal year. Mr. Griffin Correct. In each of the costings, the percentage increase is as called out in the contract. The lines that total what the total amount of wages are are certainly compounded as you go forward. Budget Review – 10/21/13 Page 13 Alderman Cookson Correct. My last question was with regard to the retro pay with sick days. I thought that I heard, and I apologize I walked in just a little bit after the conversation began, I thought that someone said, and I’m not sure who it was, that that retro pay with sick days was voluntary. Did I hear that correct? Attorney Bennett Correct. There’s no requirement that they use their sick time to pay back the retro. It’s up to them. They can pay off the total amount, some of the amount, none of the amount with their accrued sick leave. They do have to pay back the retro in some manner, but it could be through weekly contributions. Alderman Cookson Fine. It could be weekly deductions, it could be sick but they have to maintain a level of 40 hours of sick leave regardless and they cannot go below that amount for retro payback of this. Is that correct? Attorney Bennett Correct. Mr. Griffin I just want to call your attention to the costing in that particular area. This particular costing contemplates a payroll deduction scenario. Simply put it goes back to Fiscal 12, calculates what each officer would owe depending on their plan, single, two-person or family, and makes the necessary reductions from the total cosset that’s shown. If we fast forward and say that every officer used the sick time buyback, there will be no cash if you will. There will be $155,000 approximately that will just basically credit out the liability, the accrued liability on the books. My preference would be if an individual took advantage of that there would be a bump up in their taxable income because it’s basically for federal tax purposes cashing in if you will sick time. There will be an offsetting credit for the deduction that it’s going to pay for. The only additional item that I can think of is that number, $155,000, would have to be multiplied by the 25.3 percent because it would be a pensionable situation. Those are the numbers. This sheet is the traditional that you’ve seen in AFSCME and UAW, etc. It is a traditional approach to paying for the retroactive payment. Chairman McCarthy If I understand that correctly, I think Attorney Bennett said that the retro number was in the $5,000 range per employee, correct? Attorney Bennett I think I said it could be up in that area. I’m not saying that’s for each one of them. Chairman McCarthy Let’s just take that as a working number. Budget Review – 10/21/13 Page 14 Mr. Griffin That would be for a family plan. That is correct. Chairman McCarthy If someone cashes out sick time to pay that off, we owe the retirement system an additional $1200? Mr. Griffin Correct. Chairman McCarthy I also had a question about it. That translate into I think roughly 12 days of sick time or something at the rates that are in the contract. It looks like it’s in the ballpark. How many employees in this group have been here since before 2003? Chief Seusing I don’t have that number Mr. Griffin I think every single officer, supervisor has been here 2001 and prior. Chairman McCarthy That puts them in the group that has unlimited sick time accrual. What occurs from me that is the only actual liability for retirement is 120 days of that. If someone has 132 days accrued, cashes in 12 of them to pay for the retro, the city never actually recognizes any savings from that unless the employee had a long term illness that they took them in. As long as their number stays above 120, the retirement liability never goes down. Mr. Griffin Correct. Alderman Deane That puts a whole different perspective on the use of that. You know what kind of bothers me though, Mr. Chairman, most is that in my time on the board there was a point in time when we were absolutely lambasted. We were brought in front of the Public Employee Labor Relations Board because, as was happening this evening in my mind anyways, we’re trying to get answers pertaining to discussion that was held during negotiations of two parties and conversations that were held with other people that quite frankly I don’t think is any of our business. I’m not really interested in it. I understand why it happened. A letter was generated, a response was had by the chief which raises questions. Attorney Bennett is entrusted in the fact of dealing with the union and the police commission. Then we’re getting involved in the nuts and bolts of the negotiations. It’s my understanding that we’re allowed to discuss the cost items associated with the contract. How they came about them I think is all part of the negotiations that takes place. Quite frankly I’ve never seen us get into a situation where we get into this sort of discussion Budget Review – 10/21/13 Page 15 about negotiations. We didn’t sit here and ask them what was discussed and how did you come about this figure? What was this person’s position and this person’s position? I understand the Mayor’s position and why she wanted to publicly state what she stated. The way the process works is somebody brings it in, an alderman or the mayor brings it in, it gets a first reading, we have 30 days to act on it and it goes back to the full Board. We can pass it by a simple majority, she can veto it. We can override her veto by ten votes and that’s the process. We always get chastised for getting into the minutia of things. I’ve never seen in all the collective bargaining agreements I’ve dealt with and voted on, I’ve never seen us get into discussions with employer boards and the mayor and the city attorney and how they came about these decisions. I guess it’s the letters. I understand everybody’s position. I think it’s just quite a different spin than what it used to be. That’s all, that’s just my opinion. Thank you. Alderman Cookson Alderman Deane brings up a good point. While the question may not have been appropriate, I certainly appreciate the response that we received this evening. I’m looking at the first reading date which th st happens to be the 24 of September for this piece of legislation, Resolution 13-145. Today’s the 21 . I’m assuming that it’s your intention to bring this up and put it on tomorrow evening’s Board of Aldermen agenda to be decided upon by the full Board. Otherwise we don’t fall within that 30-day time limit. Chairman McCarthy Yes. As I stated at the last Board meeting, I unfortunately had to move the meeting to tonight. I had had it scheduled for last week but because of the Regional Water District meeting had to move it to this evening. Sometimes we have to do that to deal with timeframes and the rest of our schedule. Alderman Cookson Certainly. It is unfortunate because I’m assuming that these meeting minutes aren’t going to be transcribed but you’ll present an oral report tomorrow evening on this evening’s proceedings. Chairman McCarthy That’s what I would assume will happen. Alderman Cookson Thank you. Alderman Dowd I did some independent research on police salaries. Quite frankly I think we have one of the best police forces certainly in New England if not the east coast. We have a high accreditation which is an honor the chief and all the people that work for the department. When I was researching the salaries approving this contract all the way through FY15, we’re not exorbitant with the police salaries based on what other police are being paid in comparable sized cities. I’m not comparing us to Boston, New York or anything like that. The other thing is I noticed also that there was a much larger differential between lieutenants and sergeants so that one percent is just sort of a nudge because there should be a larger separation based on other departments. Given that and given the review of the contract, I’ll be supporting the contract. Budget Review – 10/21/13 Page 16 Alderman Donchess It’s hard to compare all of these contracts and these employee groups because we’re focusing on what the police supervisors in some ways have that maybe other employee groups don’t’ have. But there’s other employee groups that have very valuable things that the police supervisors don’t have. For example, merit employees by law without any kind of cost of living increase get a step increase every year of about 2 ½ to 3 percent. Similar step increases exist in some union contracts but certainly not all. This particular group has no steps whatsoever. You become a sergeant at 15 years and you serve another 15 years you never get a step increase for 15 years. Some employee groups in that period would get 12 step increases. I think Alderman Dowd’s point is a good one. I don’t know what communities he researched, but my understanding is if you look at Merrimack or similar communities around here, our police officers are not out of line. In fact they’re paid, I believe but I can’t say that I’ve done the research, but I think they’re paid less than say the police in Merrimack. To me when you look at this whole situation, the importance of this department and of law enforcement, and that the raises that they would be granted via this contract are in line with or less than what other employee groups have gotten, to me we should get this behind us. We’re getting an important concession which going in infinity there’s a healthcare concession forever. We should in my view approve the contract. A viva voce roll call was taken which resulted as follows: Yea: Ald. McCarthy, Ald. Deane, Ald. Cookson, Ald. Donchess, Ald. Wilshire, Ald. Dowd, Ald. Melizzi-Golja 7 Nay: 0 MOTION CARRIED NEW BUSINESS – ORDINANCES - None TABLED IN COMMITTEE R-12-69 Endorsers: Alderman-at-Large Jim Donchess Alderman-at-Large David W. Deane Alderman-at-Large Mark S. Cookson Alderman-at-Large Barbara Pressly Alderman Arthur T. Craffey, Jr. REGARDING ACCOUNTING FOR THE COSTS OF THE MAIN STREET PROJECT • Tabled 9/18/12 • Also assigned to the Board of Public Works; Tabled 9/20/12 O-12-28 Endorser: Alderman Diane Sheehan PROHIBITING THE CITY FROM CHARGING FOR THE COSTS OF CERTAIN OFFICIAL VISITS AND CAMPAIGN EVENTS • Also assigned to Personnel/Administrative Affairs Committee; Indefinite Postponement Rec. 12/17/12 • Tabled – 11/28/12 Budget Review – 10/21/13 Page 17 O-13-39 Endorser: Mayor Donnalee Lozeau AMENDING SEWER USE FEES RATES AND CHARGES • Personnel/Administrative Affairs Cmte Referred to Budget and Tabled in Cmte – 5/6/13 • Tabled 5/16/13 GENERAL DISCUSSION PUBLIC COMMENT REMARKS BY THE ALDERMEN POSSIBLE NON-PUBLIC SESSION ADJOURNMENT MOTION BY ALDERMAN DEANE TO ADJOURN MOTION CARRIED The meeting was declared closed at 8:00 p.m. Alderman Mary Ann Melizzi-Golja Committee Clerk