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Office of the Receiver and Council 94 Ratify Agreement

The Office of the Receiver for the City of Central Falls and the American Federation of State, County, and Municipal Employees (AFSCME) Council 94 Local 1627, representing 42 municipal employees, have agreed to changes in the collective bargaining agreement, achieving $159,000 in cost savings for FY 2011.

Under the agreement, Council 94 Local 1627 has agreed to a 10% pay reduction for three quarters of FY 2011 due to the implementation of furlough days from October 1, 2010 through June 30, 2011. This equates to a 7.5% pay reduction overall. For most departments, this means that the department will close at noon on Fridays, including City Hall. During this time frame, there will be a strict adherence to the no overtime policy that is currently in effect. Additionally, the bonus payment for waiving medical coverage will be reduced from $5,000 to $1,000. The payment will be eliminated for employees who are already covered by the City’s medical plan under a spouse or domestic partner.

All non-union municipal employees will also participate in the cost saving measures, and will also begin paying an increased co-share on medical benefits. The co-share will be increased from 5% to 10%, which is consistent the co-share previously in place for union staff. There are 30 non-union municipal employees, and the savings from the non-union changes represent an additional savings of $131,000.

The agreement was negotiated between the Office of the Receiver and the leadership of Council 94 Local 1627, and was ratified by an overwhelming majority of the members on August 27, 2010. The agreement includes a no-layoff clause for the balance of the fiscal year.

“The agreement by Council 94 demonstrates that the municipal employees recognize the seriousness of the fiscal crisis in the City of Central Falls, and are willing to be part of the solution to return the City to solid financial ground,” said Mark Pfeiffer, retired Associate Justice of the RI Superior Court and the state-appointed receiver for the City of Central Falls. “I commend them for their leadership and cooperation in helping the City through this difficult time.”

The anticipated deficit for FY 2011 is $6.3 million, including $3.4 million for the minimum annual retirement contribution to the Police and Fire pension fund. The FY 2011 baseline budget assumes available revenue will be reduced to $14.8 million from the FY 2010 enacted assumption of $17.8 million, due to the reduction in state aid and reduction in the payment from the Wyatt Detention Center. Expenditures, if unconstrained, would total $21.1 million in FY 2011, resulting in the $6.3 million projected deficit.

The FY 2011 budget anticipates $942,000 in personnel savings, from the elimination of vacant positions, layoffs, and reductions in salaries and benefits. Judge Pfeiffer has met with labor leaders representing the city’s police and fire unions, with negotiations to continue this week.

“I am confident the police and fire unions will participate in the negotiations in good faith, helping to reduce the city’s deficit,” continued Pfeiffer.

Related links

Department or agency: Department of Revenue

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Release date: 08-30-2010

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