Mar 4, 2008 7:35 am US/Pacific
Vallejo Agreement Staves Off Bankruptcy, For Now
VALLEJO (BCN) ―
The Vallejo City Council approved three resolutions early Tuesday morning that are intended to prevent the city from filing bankruptcy by the end of the month.
By a 5 to 2 vote, the council approved the resolutions, approving a tentative agreement with its police and firefighters' unions. The union members will vote on the tentative agreement by Friday. The agreement applies to the contract that expires June 30.
The Council also approved a fiscal emergency plan that will amend the 2007-2008 budget. It calls for eliminating 38 budgeted positions, including 16 layoffs. The final vote on the emergency plan is scheduled for Tuesday.
Council members Stephanie Gomes and Joanne Schivley voted against all three resolutions.
The Council approved the emergency plan even though City Manager Joseph Tanner said he believed it had only a 5 percent chance of succeeding. He said it was not a cure, but the plan and the wage and benefit concessions by the unions will "stop the bleeding and merely give the city four months time."
The city faces a $13.2 million 2007-2008 general fund operating deficit and a negative funding balance of $9 million on June 30. The fiscal emergency plan and the concessions by the police and fire unions' are expected to save $9 million.
Tanner also said the city needs more revenue and voters may be asked to approve tax measures in the November election.
Assistant City Manager Craig Whittom was more optimistic. He said the threat of bankruptcy was a strong incentive for the employee unions to renegotiate their contracts.
Whittom also said the city will now negotiate long-term contracts with police, fire and two other unions. If agreements are not reached by April 22, the Council will consider a bankruptcy resolution in late April or early May.
Several of more than 50 speakers urged the Council to file bankruptcy to give the city a new start and renegotiate all of the contracts.
Vallejo police and firefighters will give up 6.5 percent of an 8.5 raise they received last year and accept 50 percent of leave buyouts as part of a tentative agreement their unions reached with the city to try to avoid bankruptcy.
Details of the agreement between the city and the Vallejo Police Officers Association and the International Federation of Firefighters were posted on the city's Web site Friday night. The City Council will vote Monday night on accepting the agreement and the public safety unions will vote on them next week.
(© CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed. Bay City News contributed to this report.)
