February Meeting Minutes

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TSA Representatives Meeting

February 10, 2009

Minutes

1. President Ron Smith called the meeting to order at 10:05.

2. City Manager Address

• Charlie will be delivering a budget balancing proposal to the City Council this evening. This plan will allow the city to balance the budget for this year and the next four years. It specifies what it will take to balance the budget each year.

• He will meet with the representatives of the employee groups tomorrow, after he meets with the department heads, to go over the proposed plan.

• It will require a total draw of $27 million from the reserve fund balance

• No withdrawal from the reserve fund will be necessary to balance the budget as of the 2012-2013 fiscal year.

• Council has expressed concern that the plan already has begun to be implemented before they had a chance to provide input due to the notification of staff regarding the elimination of their positions. Charlie felt that, even though the plan has not been finalized and approved, it was the right thing to do to notify staff whose positions were slated for elimination.

• Charlie intends to discuss changes in benefits within the MOU negotiations; he intends to let each group structure the reductions in their benefit dollars however they see fit.

• The proposed plan addresses furloughs and reductions in work weeks as potential means of reducing the budget. The effects of these measures are indicated in the plan; however no recommendation is being made to implement them. They are being presented for the Council’s information.

• The plan assumes that the city has reached the lowest level of revenues and that the revenue stream will begin to improve. If this assumption is not born out, we will be looking at even more painful options.

• The reductions call for over $13 million this year, $11 million next year, and $2 million the third year. The last two years of the five year plan are balanced.

• The number of positions that need to be eliminated has been reduced from the initial estimate of 179 to 150 at this point. This number still may be reduced slightly.

• A question was asked concerning the savings of reducing the work week. Charlie indicated that the task force that has been studying travel reduction options also looked at a reduced work week. A two-day furlough would result in about 0.75% reduction in annual pay. A twelve-day furlough (one day per month) would result in a 4.6% reduction in annual pay.

• There are limitations on furlough due to the staffing needs of fire, the jail and police dispatch which are not structured to absorb widespread absences and still maintain service.

• The sales tax revenue reduction from December ’07 to December ’08 was just over 4%. This is less of a reduction than Tempe was seeing last summer. Other valley cities are currently seeing double-digit revenue reductions that started later than Tempe’s.

• Another question was asked concerning holding current retirees harmless of OPEB and making up the additional expenses with work week reductions and other pay-cutting measures.

• Charlie responded that he wants to keep the OPEB and budget issues separate, rather than looking at the same measures to address both issues.

• He will look to Council’s direction. They are concerned about the proposed cap on current retirees’ benefits. If they decide to take that cap out of the proposed OPEB plan, then Charlie stated he will find a way to pay for it. The cost amounts to $100,000 for every per cent raise in the cap. These are relatively small dollars when compared to the budget deficit. He wants this to remain a separate discussion from reducing salary costs to address the budget deficit.

• Concerns were raised about the lack of communication with supervisors in some departments regarding the budget reductions that were being proposed to Charlie. He responded that we need to look at the way different departments moved through the process and communicated with employees in order to learn how to do this more effectively in the future.

• Charlie outlined the process for the approval of the budget balancing plan:

  • Council will receive plan for their review this evening

  • They will hold two work sessions to discuss the plan

  • The plan will be posted this Thursday after the Council, department heads and union representatives have been briefed.

  • Charlie wants to wrap up the budget balancing plan by late March.

  • April, May and June then can be spent on addressing next fiscal year’s budget, following the plan.

3. Approval of Meeting Minutes

• The minutes from January were not available for approval.

4. Treasurer’s Report

• There was no report due to the absence of the Treasurer.

5. President’s Message

• Concerns among some TSA employees have been raised with regard to police and fire employees eligible for the state’s DROP program as of June 30, 2009 being classified as group #1 under the OPEB plan. This was raised as a fairness issue.

• After discussion, it was decided that TSA should not reverse their endorsement of this provision of the OPEB plan due to the possible ramifications of the other union groups withdrawing their support for other provisions of the OPEB plan.

• The number of employees that will be eligible for DROP as of June 30 is relatively small (approximately 20-25) and TSA stands to lose a lot more if fire withdraws their support for sharing the cost of OPEB with current retirees by placing a cap on retirees’ benefits. (Initially, the fire union was adamantly opposed to reducing the OPEB benefits for current retirees in any way.)

6. New Business

• TSA logo: it was brought up that the proposed logo resembles the GSA logo and that we should make sure our logo is distinct.

• Training for TSA representatives at disciplinary meetings was not addressed due to the length of the meeting.

• Elections: an email will go out to representatives asking for nominations for the board. All board positions are up for re-election. According to the bylaws, an election committee needs to be formed to run the election. Ron Smith asked for volunteers to step forward to serve on that committee.

7. Old Business

• The open house was not addressed due to the length of the meeting.

• MOU negotiations: Ron Smith asked for input regarding any new provisions for the upcoming MOU. Ron will be looking to change the wording of the MOU to state that the burden of proof be placed on the city concerning any alleged wrongdoing on the part of an employee. This needs to be made explicit.

8. Committee Reports

• Committee reports were not made due to the length of the meeting.

9. Open Discussion

• There was no open discussion outside of the items on the agenda.

10. The meeting was adjourned at 11:30.