Mayor Don Wesely and Lincoln Firefighters Association (LFA) President Mark Munger today announced that the LFA has agreed to work with the city to reduce personnel costs in the Fire Department budget by an estimated $413,767 in the next fiscal year. The LFA has agreed to give up the city contributions to its Post Employment Health Plan (PEHP) for the coming fiscal year, a savings estimated at $218,767. The Union has also agreed to make a significant reduction in overtime expenses, saving about $135,000. In addition, the city will eliminate one vacant firefighter position, saving about $60,000.
"I want to thank the Lincoln Firefighters Association for stepping forward to help us address the budget situation," said Mayor Wesely. "The Union has made some tough decisions, but this agreement will help us to maintain a high level of service to the citizens and to present a balanced budget."
"Our desire was to assist the city during this tough budget time and to avoid lay-offs of Lincoln firefighters," said Munger. "This agreement is positive for the Fire Department, for city government and for the citizens we serve."
Mayor Wesely commended all five city unions for their willingness to meet with city officials to work on solutions to close the projected $5.5 million budget gap in the 2002-2003 fiscal year, which begins September 1. About 93 percent of city employees are represented by one of five unions: Amalgamated Transit Union, Local 1293; Lincoln City Employees Association; Lincoln Firefighters Association, Local 644; Lincoln Police Union; and the National Association of Government Employees, Local R9-38.
The Mayor began talking with the unions in December 2001 about the budget gap and the impact it could have on personnel and services. Personnel costs account for about 71 percent of the city’s tax supported budget.
At the beginning of the fiscal year, all city employees receive a comparability increase, which is about four percent for the bargaining units under contract in the next fiscal year. Under their union contracts, city employees are also eligible each year for merit pay increases. Those increases range from one to six percent or are determined according to their step plan. The average total pay increase for city employees who are not at the top of their pay range has been eight percent. According to personnel records, more than 98 percent of eligible city employees receive merit pay increases.
In March Mayor Wesely asked the unions to consider a freeze on merit increases for one year, reducing the average city employee pay raise from eight percent to four percent. The move would have produced about $1.8 million in savings. The 65 percent of city employees who have not reached the top of their pay ranges would still have received the four-percent comparability increase, but no merit increase, which averages about four percent. The remaining 35 percent of city employees who have reached the top of their pay scales would have received half the four-percent comparability raise at the beginning of the fiscal year and the other half at the end of the fiscal year.
When the city unions requested other options, Mayor Wesely offered to work with each union separately on proposals to achieve the same $1.8 million total in savings as the Mayor’s original proposal. If agreements on compensation savings could not be reached with the unions, costs would be reduced through a reduction in personnel. The LFA’s share of the $1.8 million in projected savings was more than $400,000.
The city’s budget shortfall is the result of lower than projected sales tax revenues, which make up 43 percent of the tax-supported budget. As sales tax revenue slowed last year, Mayor Wesely imposed spending restrictions and held back about $5 million in authorized spending to ensure the city’s current budget remained balanced. Those measures included:
The Mayor will release the proposed fiscal year 2002-2003 city budget June 24.