Fire Dept. contract negotiations at stalemate
Editor & Publisher
The negotiation to reach a contract between the Town and Fire Department employees on Longboat Key reached a stalemate of sorts two weeks ago when Town Manager Dave Bullock said the Fire union’s proposal to cut costs and reduce benefits still failed to meet the fundamental requirements he will consider in approving any agreement.
In short, the Fire Department proposed to modify its current defined benefit program with various concessions to defray the cost of addressing the current unfunded liability and lower the cost to taxpayers.
For Bullock, who has offered a 401A plan as a proposal along with freezing existing pension benefits, the union’s offer fails to shift the financial risk off of the taxpayers and will not render the program a predictable budgetary concern.
At issue is after years of poor investment returns coupled with increased benefits and actuarial changes, the town’s three pension plans — Fire, Police and General Employee — have a combined unfunded liability of more than $25 million. And for Bullock and many commissioners who have spoken out on the issue, the defined benefit approach is not sustainable.
But for Firefighter/Paramedic Keith Tanner and the Fire Department, the defined benefit program can be modified to make it acceptable and meet budgetary pressures while keeping Longboat Key competitive in the market.
To date, no other municipality in Florida has a 401A type of benefit program for firefighters and paramedics.
The Fire Department, represented by Tanner and its union, bargained with Bullock at the last negotiation session two weeks ago and the mood was tense.
Bullock opened by pointing out that experts might say a firefighter needs 70% to 80% of their annual income to retire, but he said the pension should be considered only one component. He said social security and ongoing other employment are also sources in meeting that goal and takes some of the pressure off considering the pension as the sole means of income.
“50% of our fire guys work a second job; that has to be considered in how much an individual needs; there are multiple sources of income,” said Bullock.
Bullock then said he submitted the Fire Department’s proposal to two actuarial firms for review and the conclusion was that no significant savings would be realized compared to the current plan.
“It does not address predictability and leaves the market risk where it is today,” said Bullock.
Fire Department negotiator and Town Firefighter/Paramedic Keith Tanner was not happy that the Town had not completed a true actuarial study so the numbers could be evaluated.
“Where are the numbers?” asked Tanner. “We tried to get someone to evaluate this so we can have something to look at. You say ‘your guys say this, your guys say that;’ our proposal shows that!”
Next, Tanner asked why the Town did not use its actuary of record, Foster and Foster.
“Why would I?” said Bullock.
“Why wouldn’t you?” said Tanner.
“Checkmate,” said Bullock.
Bullock reiterated that any proposal that leaves the market risk on the taxpayers is not acceptable.
Then Bullock spoke of two recent hires in the Fire Department. He said that Tanner’s statements about the 401A plan hurting recruitment and competitiveness may not bear out.
Tanner replied that he spoke with the two new hires and that when they learned that the Town was looking to change to a 401A plan, they “were not happy and are looking for other jobs.”
Tanner then asked if any plan, even if the employees made a 20% contribution, would be considered. Bullock reiterated that the objectives of sustainability and predictability must be met.
“I assume you are saying you are not interested in coming to some common ground. The purpose of our proposal was to see if we could find some common ground,” said Tanner.
“Keith, we are doing our diligence…” said Bullock
“You are talking and working on your own and not trying to work with us,” said Tanner.
“We gave you our goals,” said Bullock.
“What you are saying is no defined benefit plan will work with you,” said Tanner.
“Your words, not ours,” said Bullock.
Tanner said that other departments in Florida simply are not moving to a defined contribution model and it will lower morale and create a recruitment of top employees problem.
“People will come here, but not for a long time — because you are not competitive. They will come here and work until something opens up on the other side of the bridge,” said Tanner
Bullock said the job would offer career employment:
“We are proposing 23% of salary gets put away. They will come away with a lot of money,” said Bullock.
Tanner said that number could change at any time. He said there is no guarantee that it could not change in a few years to a 4% match from a proposed 10% match
“There is no guarantee we will have a Fire Department,” said Bullock.
Tanner said the department’s agreed-upon concessions go “above and beyond what every other department has agreed upon.”
Bullock said he did not think Tanner could say that his statement was based on all the facts.
“We have done our research,” Tanner replied.
Bullock said the Town needs to “cap its expenses.”
The Town and department are scheduled to continue negotiations throughout the summer with a goal of reaching a mutually acceptable contract. Any contract will have to be approved by the Town Commission ultimately. If no contract is agreed upon, the Commission can eventually impose a contract.