Police Contract Passed; $834K Pension Hit Expected

Alders unanimously approved a new police union contract that will grant city officers their first pay raises in over three years, and that will also cost the city around $834,000 more in annual pension contributions.

The full Board of Alders took that vote Monday night during its regular bimonthly meeting in the Aldermanic Chambers on the second floor of City Hall.

In front a full house of officers eagerly waiting to see if the alders would approve the new six-year contract, which will grant a total of 13.5 percent in retroactive and future pay raises covering 2016 through 2022, the alders cast their unanimous support behind the new labor accord.

Before that vote, however, a trio of fiscal skeptics questioned the wisdom of signing a new union agreement after having so little time to review some of its most critical citywide financial implications.

Prospect Hill/Newhallville Alder Steve Winter, Downtown Alder Abby Roth, and East Rock/Cedar Hill Alder Anna Festa pointed in particular to the numbers that the city’s Office of Management and Budget (OMB) had delivered to alders only seven hours before the vote that detailed how the new agreement will affect the city’s pension costs.

That report, put together by city contracted actuaries at the accounting firm H&H, projects that the labor contract’s salary increases will add $843,264 to the city’s annual actuarily recommended contribution (ARC) to the Police and Fire Pension Fund (P&F).

The city currently contributes $38,629,220 to P&F every year, as well as $22,221,339 every year to the other public pension fund, the City Employees Retirement Fund (CERF).

Click here and here to read the actuary’s estimates of the increased pension costs.

In a public information caucus before Monday’s full board meeting, city Acting Budget Director Michael Gormany explained that the alders received the pension impact information so late in the process because the final contract had only been ratified less than a month ago, and actuaries need time to crunch all of the numbers in such a long and complicated document. Furthermore, the increase likely won’t affect the city budget until Fiscal Year 2021-2022 (FY22), since that is the next time the city plans to recalculate and update its annual ARC.

“I want to note publicly that this agreement comes with significant costs to the city,” Winter said. “Over $3.4 million in police salary and an estimated $800,000 increase in pension payments, assuming the P&F fund returns an average of 7.75 percent annually. To pay for these increases along in Fiscal Year 2021 would require a 1.5 percent increase in property taxes.”

Roth and Festa expressed a similar level of wariness over the last-minute provision of the pension increase estimate.

After praising the new contract for relieving officers of years of “stressful and unsustainable financial uncertainty,” Roth asked publicly why the the city could not wait a few more weeks to review the auditor’s recommendations before submitting the ratified agreement for aldermanic approval.

“I was surprised to discover that the city agreed to the contract without first finding out from an actuary how this likely will impact how much money we will have to pay each year into our already seriously underfunded pension system,” she said. “This would be like entering into a mortgage without knowing your annual payments.” According to the city’s latest budget document, CERF is currently funded at around 37 percent, and P&F is currently funded at around 40 percent.

“I stand not in opposition of this contract,” Festa said, “just with concerns.”

Winter, Festa, and Roth stood alone in that dissent, however, as their colleagues dismissed their concerns as inappropriate at a time when the police department has gone over three years without a valid contract, and has been hemorrhaging officers as they retire or flee to better paying jobs in the suburbs and at Yale.

“Finally our police officers can get what they need in order to be comfortable in their job,” Dixwell Alder Jeannette Morrison said, ​“which is to protect us.”

The long-suffering contract negotiations and expired labor agreement have directly fomented a ​“blue exodus” of officers from the city, she said, which in turn has hurt the city’s ability to conduct a neighborhood-engagement model of community policing.

“I do understand the cost,” she said. ​“I do understand all those different things. But sometimes we have to look at the people part of it. And this is the people part of it: This is our officers. This is the residents who live in the City of New Haven.”

Hill Alder Dave Reyes and Fair Haven Alder Jose Crespo agreed.

“We’re losing our officers to the surrounding towns and we’re not getting anything back,” Reyes said. This contract will finally grant city police ​“their fair share in compensation” and much needed job stability and security.

“I support it 150 percent,” he said, ​“and I urge my colleagues to do the same.”

“I understand that there might be a couple of unknowns,” Crespo added, ​“but right now, this is what’s best. This is what’s needed for the department, to bring stability, to bring up the self-esteem of the officers.”

Board of Alders Majority Leader and Amity/Westville Alder Richard Furlow expressed the sharpest indignation at his colleagues’ skepticism of the contract.

“We can’t have this both ways,” he said. ​“We have a contract that is before us now that the officers have ratified overwhelmingly. This is what they want, and it is our response to vote favorable on what is before us.”

The alders cannot control what happened in the past, he said, what may have led to the three years of delays and bitter labor disputes as officers fled the department after the last contract expired. But they can control what happens going forward, he said.

“Let’s vote in favor on this,” he said, ​“and stop the shenanigans.”

Fire Union Contract Ratified, Submitted

Monday night’s agenda also included a newly submitted fire union contract, which, according to city Labor Relations Director Thomas McCarthy, the members of the city’s fire union, Local 825, ratified on Sept. 6. That proposed and member-ratified contract now advances to the Finance Committee for a public hearing before being sent back to the full board for a final vote.

Click here to download details on the new ratified fire union contract.

According to McCarthy’s submission letter to the Board of Alders, the new six-year deal extends from July 1, 2018, when the last contract expired, through June 30, 2024.

It includes an 11 percent pay increase over the term of the contract; implements a new Health Incentive Program (HIP) that requires union members and their dependents to take various preventative medical measures like designating a primary care physician and receiving annual checkups; and increases the employee pension contribution to 11.5 percent of their annual salary.

Click here to read a criticism penned by Westville alder candidate Dennis Serfilippi about a memorandum of understanding signed during the contract negotiations that limits the chief’s abilities to reduce the department’s minimum staffing levels.