Press Release: City, fire union tentatively agree on new contract
The City of Pensacola and International Association of Fire Fighters (IAFF) Local 707 have reached a tentative agreement on a new three-year contract which would close the Firefighters’ Relief and Pension Fund to new entrants effective October 1, 2013.
The agreement, which would cover 106 men and women of the Pensacola Fire Department, comes on the heels of last week’s announcement of a new contract with AFSCME Local 3253, the City’s general employee union. That agreement contained several pension reforms expected to reduce the City’s unfunded pension liability by nearly $5 million.
“I want to thank our firefighters for coming to the table with a cooperative spirit and a willingness to focus on real solutions,” said Mayor Hayward. “With this agreement, we’re continuing to take action to reform our pension plans. It’s important to take care of all of our employees, but we must balance that with our responsibility to taxpayers and the City’s continued financial stability.”
In exchange for wage considerations, IAFF has agreed to close the Firefighters’ Relief and Pension Fund to new entrants effective October 1, 2013. Firefighters hired after that date would instead be eligible to participate in the Florida Retirement System (FRS), a state-operated plan. As FRS benefits are transferable, the change also enables Pensacola to recruit firefighters from other cities, counties, and special districts throughout the state. The union also agreed to adjust its Deferred Retirement Option Program (DROP) benefit to conform to its FRS equivalent.
In return, the City will provide members of the bargaining unit with a one-time payment of $2,000 upon ratification, as well as a 2% wage increase in Fiscal Year 2014 and a further 3% increase in FY 2015. “As I’ve said before, whenever we ask employees to accept changes to their retirement benefits, we should look at opportunities to adjust compensation packages for those affected,” said Mayor Hayward.
“We’ve worked hard to get through these difficult issues with the Mayor to and move the City forward in these tough economic times,” said IAFF Local 707 president Philip Hoffman.
This latest agreement furthers Mayor Hayward’s pledge to address the City’s unfunded pension liability and annual pension costs. Closing the pension plan to new entrants helps stabilize the unfunded liability, which in recent years has ballooned to over $116 million. “By closing this plan and transitioning new firefighters to FRS, we can focus more of our attention and resources on providing quality services to our citizens,” said Hayward.
If approved by the union membership and City Council, the new collective bargaining agreement will take effect October 1.
Editor’s Note: Congratulations to both parties. The negotiations weren’t easy, but the IN is happy to see that agreement was reached.