City, Police Agree on New Pay Package

The City of Monrovia and its police employees have agreed to a new five-year contract, ending months of contentious public debate over salaries and benefits.

 Mayor Rob Hammond said that, “this contract will fulfill the City Council’s top priorities of fiscal responsibility and public safety. It keeps Monrovia competitive, while still maintaining the City’s ability to pay the cost.”

 “We were not only able to offer a competitive package while still maintaining our financial integrity,” Ochoa said, “we now have a more stable means of controlling future costs. The new contract moves away from basing compensation on a survey of other cities and establishes a baseline cost and fixed increases over the next five years.

“Given public safety’s operational priority among municipal services,” Ochoa said, “this will allow the City to effectively budget resources without the fear that the regional market for police officers will continue to spiral out of control.”

The City Council approved and signed the new contract Tuesday night. The MPOA leadership had signed the day before.

Compensation Numbers / Background

Contract negotiations for Fiscal Year 2007-2008 hit an impasse in the spring, with the MPOA demanding a 23.2% raise over three-and-a-half years, an average of 6.62% per year.

The City had offered an increase of 16.5% over that same time period, an average of 4.71% per year. The MPOA turned that down.

The contract approved Tuesday night will give the MPOA members 22.25% over five years, an average of 4.45% per year.

When no agreement could be reached last spring, the City Council unilaterally implemented a one-year contract for 2007-2008 that included a 4.7% salary increase for Police Officers, a 6.2% salary increase for Police Sergeants, and an average salary increase of 4% for non-sworn Police Department employees. That contract expired July 1, 2008.

Talks on the new contract began in the late spring.

The raises in the new contract will cost the City’s General Fund $248,169 in the 2008-2009 fiscal year, an amount already incorporated in current year’s budget.

Details of the Contract

The new contract contains the following provisions:

For sworn personnel (police officers)

Salary, medical and POST training benefits are all increased in the 2008-2009 fiscal year to the average of an agreed-to list of surveyed cities (hikes averaging approximately 5%). Half of the increases will be retroactively effective June 22, 2008 and the remainder will become effective on December 21 2008.

Administrative Leave, Workers’ Compensation Leave, Jury Duty Leave and Military Leave will no longer count as hours worked for purposes of calculating overtime compensation.

For non-sworn personnel (jailers, clerks, etc.)

The City’s medical benefit contribution is increased by $60 per month retroactively effective to July 1, 2008.

In the 2009-2010 fiscal year, two additional holidays are added to the annual calendar – December 24 and 31.

Salaries increase by 3% in each of the 2009-2010, 2010-2011 and 2011-2012 fiscal years.

Salary increases by 4% in the 2012-2013 fiscal year.

Other provisions

Two remaining suits dealing with compensation for Canine Officers will be settled outside of the contract process, again with plaintiff attorney fees to be paid by the MPOA.

Policies concerning drug and alcohol abuse and family medical leave will be updated and developed, and administrative appeal language related to non-disciplinary issues will be developed, all outside of the contract process.

The contract now requires that a doctor’s certificate be presented for any sick leave absence of more than three consecutive days, not including family sick leave.

The contract now includes bilingual pay based on languages identified by the Los Angeles Registrar Recorder/County Clerk for use in municipal elections held in Monrovia – effectively Spanish and Chinese.

The contract will now require that employees on leave (not vacation or holiday) make themselves available by phone within three hours.

Bond Plan Provided Settlement ‘Bridge’

Prior to approving the new contract on Tuesday, the Council also approved the issuance of Pension Obligation Bonds to finance the safety employee portion of the City’s unfunded retirement liability.

Pension obligation costs had been a major stumbling block in the negotiations. Monrovia, like several other nearby communities, has long counted pension benefit costs as part of total compensation. The MPOA, however, demanded this time around that compensation be totaled without considering pension costs, figuring in only salary, medical benefits and training pay.

Bond costs have changed in the current market and it is now less expensive to service debt on the bonds that to fund the annual retirement liability.

Tuesday night’s staff report called it “a unique opportunity to potentially realize significant cost savings…(and) pay off the unfunded liability in the City’s safety retirement plan.”

That future public safety retirement liability was estimated in June of this year at $13.1 million.

The MPOA had dismissed the bond solution during negotiations earlier this year. Later meetings, however, moved the bonds back on the table coupled with the MPOA’s agreement to move away from its traditional “5%-above-the-mean” language, focusing instead on “average compensation.”

A New Framework For Compensation

That meant that it would no longer be necessary to survey other cities and compare total compensation.

“Whereas in the past we would conduct a survey each year to determine what ‘5% above the mean’ actually meant in terms of dollars and cents, this new contract features a baseline cost and fixed increases over five years,” he explained. “Given public safety’s operational priority among municipal services, this will allow the City to effectively budget resources without the fear that the regional market for police officers will continue to spiral out of control.”  

Compensation tied to salary surveys has meant that a raise in one town would automatically result in raises in all the other surveyed cities, with salaries and benefits spiraling upward without consideration of local affordability or priorities

“Even with the year-to-year cost stability afforded by the bonds,” he said, “the retirement cost is a major component in determining what the City can offer and agree to. Were this not the case, the contract with the MPOA would have presumably been much richer, instead of the fair and affordable agreement we’ve been able to reach.