City seeks pay cut for employees

<p>Petaluma has whittled its $4.5 million budget shortfall to $1.1 million heading into the next fiscal year, but is still negotiating with employee unions over pay and benefit cuts needed to close the gap.</p><!-- Nothing to do. The paragraph has already been output --><p>By freezing vacant positions, consolidating others and tapping into reserves, the city has reduced the amount it needs to bring its budget into balance, but there is more work to be done, City Manager John Brown told the council Monday.</p><p>The city will release a preliminary budget Thursday, June 4, and has scheduled a council workshop next week to began reviewing the document, with approval of the budget scheduled for June 15.</p><p>Brown said the budget will include a 5 percent cut in salaries and benefits in the general fund, which pays for basic city services such as public safety, parks and maintenance.</p><p>How the 5 percent cut will be achieved has not yet been determined. Negotiations with the city’s employee bargaining units are continuing, Brown said, and the results could change his final budget recommendations.</p><p>“There is still a fair amount of bargaining left to do, and it may be done before the 15th and it may not,” he told the council. “If we can’t reach some kind of accommodation with employee groups, at this point the indication we’ve gotten back is we may need to enact additional layoffs.”</p><p>Last week, the city’s largest employee union — the Association of Federal, State, County and Municipal Employees — sent a letter to city officials stating that its members had not agreed to any concessions sought by the city.</p><p>The union, which represents more than 100 city workers in secretarial, maintenance and office jobs, claims the city in April proposed either a 9 percent pay cut or full payment of health-care costs by employees, or it would face up to 30 layoffs.</p><p>The union’s letter said it was willing to continue to meet to discuss deferring a 2 percent pay raise this summer in exchange for a contract extension.</p><p>An AFSCME representative could not be reached for comment. Brown said he wouldn’t comment on the status of negotiations, but said the letter’s assertions “don’t reflect my viewpoint on our initial meetings” with AFSCME.</p><p>“My primary concern is getting back to the table with them,” Brown said.</p><p>He told the council Monday that the city and some of its nine employee unions had reached preliminary agreements, but cautioned that formal contracts hadn’t been signed yet.</p><p>In order to get down to the $1.1 million remaining shortfall, the city will enact a number of cost-cutting measures, including some consolidation of services that might result in “live bodies” being let go, Brown told the council.</p><p>Employees are also being offered an early retirement package to save the city money by taking those workers off the payroll. A similar program was offered earlier this year as the city cut several million dollars from its general fund, which is typically around $40 million.</p><p>A slide in “virtually every one of the city’s revenue categories,” from sales taxes to interest earnings, necessitated more cuts, Brown said.</p><p>“Our overall goal here has been to not reduce services, if at all possible,” he said. “We have not gone after entire programs.”</p><p>He told the council he expected to present a balanced budget, though it had been “extremely difficult” to find ways to close the gap and such a budget “still relies, preferably, on the ability of our employees to work with us.”</p><p>Brown said the city is not currently planning to cut an additional $1.1 million if the state takes that amount in property taxes, which state officials have said is likely in the wake of the failure of several budget-related propositions last month.</p><p>The state is guaranteeing eventual repayment of those tax dollars, so cities are hoping to borrow the money against that promised payment, Brown said. </p><p>“I don’t think any of us have the stomach for making any more cuts,” he said.</p><p>(Contact Corey Young at corey.young@arguscourier.com)</p>