Pace to Seal Labor Deal Quickens in Cranston

With Mayor Napolitano about to exit office in three weeks, the Projo reports that he will be signing a major labor contract before he is done. This contract for the Laborers, of which there are 75 employed by the city, provides no raise for this year but 2.9% and 3% raises for year two and three of the contract. From the Projo:

Those raises are expected to cost $269,820, but Fung says he is more concerned with the timing of the deal and the fiscal uncertainties the city is facing. The approval would come just three weeks before he is sworn in, and Cranston — like many other communities — is bracing for cuts in non-school state aid and possibly other areas, including state aid to schools. At the same time, Cranston’s School Department is projecting a deficit as high as $10.8 million.

“We need to get more solid numbers before we ratify this agreement,� Fung said of the proposed pact with Local 1322 of the Laborers’ International Union of North America. “I’d like the opportunity when I get into office to negotiate this contract, and all other contracts, with the financial health of the city in mind.�

[…]

Fung also objected to language that provides four hours of compensation, rather than the current three, for employees called in for overtime from Dec. 31 through March 1, and language that would leave employees hired before July 1, 1995, paying 12 percent of their health insurance premiums. Laborers hired after July 1, 1995, pay 20 percent. [full text]

While I’m pro-labor, I have to say that it seems the fairest thing to do right now is to let Allan Fung negotiate this contract. As our country and state face times of extreme financial uncertainty, we should be super-scrutinizing every possible promise of a raise. With the cuts from state and federal funding, the loss in tax revenue from lack of business and housing foreclosures, and the massive debt already incurred by our schools, it seems to me that the best we can probably do is to try not to lay people off over the next two to three years. The more raises we give, the likelier it is that more city workers will face lay-offs. People will lose their jobs. Services will be reduced. It’s that simple.

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22 thoughts on “Pace to Seal Labor Deal Quickens in Cranston

  1. “But Ernest J. Carlucci, chief of staff for Mayor Napolitano, and Councilman Terence E. Livingston, who chairs the council’s Finance Committee, defended the contract and said it is fair to the city and to the union, which has about 75 members.

    While union members earn an average pay of about $35,000, they already pay higher health-insurance premiums than most city employees, Carlucci and Livingston said.

    They also said the employees deserve credit for giving up a raise this year.” – Projo

    Credit for giving up raises? How about being thankful for still having a job?

    Kiersten hit it on the nose. Let the new Mayor and Council make the decision once we know what kind of a financial mess we are in. Forget the raises and just try to avoid the layoffs.

  2. My company recently had a wave of lay offs. Thankfully, I survived. There will also be no raises next year as well as no 401K pension contribution. Not only should all cranston public employees agree to a salary freeze, our elected officials should be looking at other ways to lessen the burden on us taxpayers. Lay offs, additional healthcare contributions, etc. Covenants to any new contract should only be discussed after we see what type of mess we’re in……It’s only fair…….

  3. I have to agree with everyone, I don’t think that something as major as a multi-year contract negotiation should be pushed through with 20-something days left from Dec. 15 until the new administration and council is sworn in on the 5th.

  4. There should be across the board pay freezes for both contract employees, and the incoming administration. To give the laborers raises sets a bad precedent for the other upcoming contract negotiations.

  5. The raises that are proposed in this agreement are well below the cost of living. If you pay peanuts, you will get monkey’s. Also, they pay the highest co share in the city. Did you people read the entire agreement or are you just preaching what someone else says?

    Also, let’s see what Fung gives his administration when he steps into the corner office.

  6. I didn’t know that monkeys were attracted to peanuts. I always thought that they were keen on bananas. Now elephants, there is an animal that will do a trick or two for a peanut.

  7. Forbidden Force, the fact of the matter is that the people in place are probably not going to be bolting for the door to get a higher salary and better benefits elsewhere. Chances are, they will stay, even without a raise.

    Lord knows peons, er people in the private sector hang on to their jobs like grim death, and the benefits aren’t half as good.

    This needs to be taken into consideration when negotiating contracts: municipal jobs are “good” jobs. In many cases, they are paid well above the state median (approx $39k, per my last foray into the stats). As such, it will be difficult for them to do better.

    The sad fact is that median wages have fallen for nearly everyone over the past 8 years as a direct result of Republican national policies. Private sector workers are not getting raises to keep up with inflation. Which means that tax increases actively cut the worker’s standard of living. If my salary goes up 2% while inflation is running at 3%, I’m losing ground. Increase taxes and I’m losing more.

    That’s why the tax cuts for the high-end earners at the fed and state levels are such travesties. High-end salaries are outstripping inflation; this is the one group that can afford to pay more.

  8. It shouldn’t be assumed that the union would get a worse deal when Fung comes in. Our state is facing a major fiscal crisis, and in truth, how many of you have faith in the Governor and the General Assembly to resolve it without killing taxpayers?

    I don’t.

    And in this economic climate, this deal could portend layoffs and what’s preferable, a few years without a raise or layoffs in an economy where there are very few jobs? I prefer the former, and Fung should be afforded the opportunity to negotiate a deal he believes will be the right one for the city as he was elected Mayor, in part, because of his fiscal responsibility.

  9. I can’t understand why everyone believes Fung should have negotiated this contract, just because he is Mayor elect? This contract came due in this administration. So what you are saying is if John Doe or Jane Doe run against Fung in 2010, maybe he or she should negotiate any contract due in July 2010?

  10. Territorial aren’t we? Mayor-elect Fung wants to “…negotiate this contract and all other contracts…” I am sure he does. Mayor Napolitano wants to finalize this deal and feels that he is acting in the best interest of the city. Fine. Let’s put aside the Nap vs Fung/ Dem. vs Rep. posturing and look at the numbers (using those provided above): $270,000 dollars split between 75 laborers over the course of 3 years will by the contracts end net each of the 75 workers $1200 total or to break it down further an additional $23 per week or $.58 per hour by 2011— an average hourly wage increase of just $.19 per hour over the course of three years. Regardless of what side of the political fence one may lean towards, this deal is NOT a “give away ” or “sweetheart” of a deal for the Laborers. As far as the threat of potential future layoffs if the economy continues to tank and state/fed funding continues to dry up, it is quite likely that those layoffs would still be implimented regardless of whether or not this deal was finalized. I can certainly appreciate Mayor-elect Fung’s desire to take the reins as soon as possible, but the last time I checked George W. Bush was still globe-trotting in Air Force 1 and ducking shoes and insults, while President-elect Obama was
    assembling staff and PREPARING to take office. Our Mayor-elect will have plenty of decisions to make, changes to impliment and of course contracts to negotiate during his 2 years in office… as my Grandmother used to say “simmer”.

  11. Rick,

    With all due respect, I think that you are missing the point. This has nothing to due with what is in the contract but merely the fact that we, as a city, do not know what the upcoming year will bring. With proposals, and I will grant you the expected dig, from the Republican Governor’s team to toll our roads, and add a “mileage tax” we have no idea what sort of financial shape the state and in turn city will be in next year.

    If this were a “typical” economic situation I would agree that Mayor Nappy should handle whatever comes across his desk. However my argument would be the same no matter who were heading into the Mayor’s office.

    To act on this contract now without the facts of how to pay for it would be an irresponsible disservice to the citizens of Cranston.

    This has to stop being looked at as a “turf war” and must begin to be looked at by asking, “what is best for the city.”

    There are plenty of Cranstonians who would be quite happy with an additional $0.58 per week over three years rather than a lay off if their company could afford it.

    Maybe Cranston can, let’s just be sure.

  12. Jim,
    If I may… I certainly understand that these are very difficult and uncertain economic times, but with an annual operating budget of some $240 million the $90,000
    per year cost detailed in this agreement amounts to a fraction of one percent of those annual costs. If our city cannot absorb the “hit” of $90,000 annually then we will have to impliment layoffs and/or raise taxes, either way those 75 laborers are going to have less money in their paychecks in 2011 than they do today.
    As far having our city’s duly elected and sitting Mayor addressing issues that come across his desk, our twice (well at least once-’04) elected sitting President is in on the negotiations for whatever bailout is slated for this week and is still making decisions that will impact this country in the coming years…

  13. Rick,

    I think you make some fair points. I don’t think this is a ‘sweetheart’ deal for the Laborer’s union. One thing you didn’t mention is the health care cost for employees in service prior to 7/1/95 maintaining a healthcare cost of 12% versus 20% of other employees. I’m not sure how many employees that affects and the cost savings of 8 percent, but that too needs to be taken into consideration.

    If I am to infer from what you are saying,you seem to be advocating that Mayor-elect Fung not try to interject in the negotiations of this contract. In my opinion, Fung wouldn’t be doing his job if he stood idly by while the city agreed to a contract that would be bad for the city. Indeed, President-elect Obama certainly has plenty to say about the current economic crisis and has even said he just hopes that when he enters office it’s not too late to right the ship!

    To me this is about a mindset change and a different way of doing business. I agree that the union is not coming out of this contract with a large win, but I do believe that you have to consider that this contract could lead to layoffs if the economy continues down this same road. And if you’re ok with Fung being ok with that…well, that’s just not ok with me. (and yes, he won twice)

  14. Don,
    While it is apparent that you can see where I’m coming from on this one, you are still missing my point (a bit) and I quote: “…this contract could lead to layoffs if the economy continues down this same road.” In my opinion the potential for future layoffs will be there even if this contract never sees the light of day. The $270,000/over the life of the contract; $90,000/ per year cost is as stated a mere fraction of one percent of the city’s annual operating costs. I do not have a problem with Mayor-elect Fung trying to step up and get involved in these negotiations, and in a better world perhaps Nap and Fung could work together during this awkward transition period, but my point is that until Fung actually takes office, it is still Nap’s call. If indeed “perception if reality” then the frequent references to the School Department’s potential $10.8 million dollar shortfall when discussing this and all union contracts unfairly serves to link our city’s current fiscal woes to the contract being discussed.
    Jim,
    You state that we need to stop looking at these negotiations in terms of a “turf war” and that we all need to be asking “what is best for the city”. I agree.
    While I am a staunch Democrat, that is not the reason that I do not consider Nap’s actions to be out of line. Given the amount of money involved and the fact that there will be no raise for the Laborers during ’09 I feel that this contract, even during these uncertain economic times is/will be a good deal for the city and is not the “money grab” that it is being portrayed as.

  15. In my view, this isn’t just about the laborers. It is my understanding that fire, police, and teacher contracts will also be coming up in the next two years. This contract is setting a precedent for the upcoming negotiations. If we give the raises to the laborers, the other unions will certainly demand at least the same percentages they received. The city will not be able to afford it given the almost certain cut to state aid to cities and towns.

    Gas prices are almost down to 2001 levels. Deflation seems to be occurring, the merits of which is not good for the economy but would benefit the laborers who don’t produce goods. We are in a time that we need to hold the line on pay increases.

    And again, I stress that this should also hold true for anyone taking an appointed position with the Fung Administration.

  16. Don (Botts),
    If you fear that the proposed laborers contract will be precedent setting and serve, if you will, as a template for future teacher, police and fire contracts…then fear not. If the existing teacher, police and fire contracts mirrored this proposed laborers deal, our city’s current fiscal woes would be significantly less daunting. This proposed contract would, by year 3 of the agreement, net the average city employed laborer an additional $3600 and bring the average city employed laborer’s salary to $38,600 based on the figures stated in the above article. This increase would be based on a total package salary increase of 5.9% over 3 years or roughly a 1.96% yearly. By contrast the current fire contract features 2% raises in January of 08,09, and 2010 along with 2% raises in June of 08,09, and 2010- or roughly a 12% increase over the life of the contract before any compounding is figured into the equation. Given that the lowest paid fire positions (private with less than 1 year service time)earn in excess of $50,000 per year, this proposed laborer’s deal appears to represent a relative bargain for the city. When you attempt to use the current drop in gasoline prices to justify your reluctance to increasing the salaries of some of our city’s lowest paid employees you run the risk of waxing Ebenezer, “Are there no poor houses…”

  17. The problem is, our current fiscal woes are daunting to the extreme. Review the city budget and pick out where the city can save money. I glaced at it recently, and there is not a lot that can be pared down without serious consequences to the city’s quality of life. So, at the very least, we have to hold the line in costs.

    City revenues are going to be down from last year. Drive down any main street in Cranston and look at all the vacant commercial properties. Commercial tax revenues are going to drop. State aid to the city is going to drop, if not be eliminated all together. So you can go on saying that their increase is relatively small. But it isn’t on a budget that is already in a deficit. And once again, it will fall on the shoulders of the taxpayers with an increase in property taxes.

    I use the example of gasoline prices dropping to show that cost of living is actually going down right now. Heating oil is down from last year. Add in the specter of deflation and a stagnant economy, and it is tough to justify raises.

    I don’t qualify the parameters of the contract as a money grab. In normal times, it would be a fair contract. But right now, the city can ill afford anything that would increase expenses.

  18. Don Botts: deflation is when we need to inject more money into the system, not less. Counter-intuitive, but true. Wages and prices fell from 1929-1932. That didn’t work out so well.

    There are places that savings can be had. The idea of consolidating personnel and purchasing between city and schools has been talked about for decades. That’s one place.

    Does the mayor need a car? I mean, really? How many vehicles does the city maintain? Are they all really necessary?

    How many firefighters do we have? Has anyone ever looked at the ratio of firefighters/population to determine what the optimum is? Fung worked at the home/auto section of Metlife; maybe he has connections with an insight into this.

    These are not considered ideas; the intent is to promote discussion. I hate the phrase “think outside the box,” but it’s exactly what we need to do.

    Oh, and raise taxes on high-end earners, both at the state level and, especially, at the nat’l level. Raise cap gains tax rate to 25 or 30%. Despite all the lies to the contrary, cutting it hasn’t promoted investment. Non-residential investment in this “expansion” has been at the lowest level for any expansion since WWII. Plus, how is it fair that someone living off dividend and cap gains income pays a lower rate than you (I presume) and I who have to work for a living. That is simply a warped value.

    Like it or not, what we are experiencing is the result of 30 years worth of Republican economic policy. Give more to the wealthy, take it away from the middle class. We’ve lost state and fed funding that existed a decade or two ago. All because we allowed the top couple of percent to become extremely wealthy while the rest of us are losing ground. This has been the first economic expansion since WWII when median wage is lower at the end than it was at the beginning. Median wage is lower than it was in 2001.

    It hasn’t, and it never will, trickle down.

  19. Don(Botts),
    I too understand that these are not normal times.
    I too understand that there will be serious dropoffs in tax revenue, that vacant and failed commercial ventures do not generate tax dollars.
    I too am hard pressed to find areas in the current budget
    where significant savings can be hard without severely compromising our quality of life.
    I do take issue with the way that this proposed contract is being presented, how in print it is linked to the School Department’s projected shortfall; how the above article hints at some perceived underhandedness because the contract is being considered in the waning days of the Napolitano administration and how the passage of this proposal would inevitably lead to layoffs, layoffs that may be implimented regardless of this proposal being put into play or not. In your last two posts (#15 and 17) you mention falling petroleum prices and a drop in the cost of living as having the potential to “benefit” the laborers, these dubious economic phenomena will also “benefit” well paid appointees, Fire and Police Chiefs, School Department Heads, and a good number of city officials making far more money than the laborers. Oh my, perhaps we have just stumbled on to an area of the city’s operating budget where significant cuts could be made without significantly reducing our quality of life.

  20. I guess the point is moot because the contract was passed.

    Klaus: I understand that when deflation occurs, more money needs to be injected into the economy. The reason why deflation is bad is due to the public sitting on purchasing goods because prices keep dropping. But, in the case of government workers, they are not producing goods. They are not subject to layoffs when factories have to cut back production because there is too much inventory out there. And I wasn’t asking for a cut in salary, just keeping it at status quo.

    I don’t think people realize what kind of hurt the state, and thus, Cranston is in for. Everyone is burying their heads in the sand about this year’s $300 million dollar budget deficit. No one is even mentioning it is projected to be $400 million for the next fiscal year.

  21. Don,

    You’re right on and Rick you also failed to mention the cost of the 8 percent gap for health insurance that is also going to be an additional cost to the city.

    We’re in for some difficult economic times and whereas this contract is not a catastrophic blight upon the city, I am very glad our current mayor is on his way out. People are putting their heads in the sand and the governor’s answer has always been cut this or that rather than developing revenue streams (at least sustainable ones) or finding ways to deliver the same products at reduced costs.

    The Assembly has been even worse as they should have seen this train wreck called the RI economy coming long before now. In any business the performance of a company is tied to the continual employment of the executive team. Here in Rhode Island we have demonstrated an uncanny knack for voting for people who do not have ideas for change again and again and again – especially in the General Assembly.

    We need people who will not put their head in the and people who also have ideas that aren’t “tax and spend” or “cut and duck”. Without a new economic framework we’re going to continue to be mired within the economic doldrums longer than the rest of the nation.

    Any leaders willing to step up?

  22. What we need are officials that will stand up to union demands, and bring benefits and salaries in line with those working in the public sector. A 0% increase for 2009 is a meager start. What about health insurance, sick time, vacation time, life insurance and dental. Do public entities downsize??

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