Vallejo Employee Contract Terms

82% of Vallejo’s General Fund expenditures are for salaries and benefits. The Mayor and Council will be renegotiating these contracts during their first year in office and the decisions made will have a significant impact in determining Vallejo’s success as it emerges from bankruptcy. The city negotiated new contracts with all employee groups after filing for bankruptcy in May 2008. The Police (VPOA) and Confidential, Administrative, Managerial and Professional (CAMP) contracts were negotiated first and had significantly better pay and benefits than the Fire (IAFF) and Miscellaneous (IBEW) contracts that were negotiated later. The contract dates and the council votes were as follows:

Bargaining Unit	Police - VPOA	Admin - CAMP	Fire - IAFF	Misc. - IBEW
Date Approved	1/28/09	2/10/09	3/23/10	11/30/10
Contract Term ends	6/30/12	6/30/13	6/30/12	12/31/12
Council Vote	5 to 2	5 to 2	4 to 3	7 to 0
Voting in Favor	Davis, Hannignan Wilson, Sunga, Bartee	Davis, Hannigan, Wilson, Sunga, Bartee	Davis, Hannigan, Wilson, Sunga	All in favor
Voting Against	Gomes, Schivley	Gomes, Schivley	Gomes, Schivley, Brown	None

The VPOA contract was the most generous and was approved early to remove the VPOA objection to the bankruptcy filing. It provided for pay increases on 7/1/10 and 7/1/11 and continued the benefit programs in place including 100% payment of medical insurance premiums for active and retired employees ($17,752 a year for family coverage) and the continuation of longevity pay of 5% at 20 years and 10% at 25 years. It also provided for a separate $1 million payment ($333,333 a year starting 7/1/12) for breaching existing contracts and to pay a portion of the accumulated vacation and sick pay that was withheld when a large group of police officers retired prior to the city filing for bankruptcy.

The CAMP contract provided for 2% raises on 7/1/10 and 7/1/11 but these raises were offset by unpaid furlough days during those years. Other benefits remained mainly intact except that longevity pay was cut in half for new employees; sick pay was increased from 96 hours to 144 hours but the cash out on retirement was eliminated and health insurance premiums for new employees and retirees are paid at 80% rather than 100%.

The IAFF contract had significant reductions – a 2% pay reduction on 9/1/09, no increases on 7/1/10 or 7/1/11; elimination of longevity pay; PERS pensions for new employees set at 2% @50 vs. 3% @ 50 for existing employees; the employee contribution to PERS increased from 9% to 13.4%; health insurance premiums paid by the city reduced from 100% to 75% and health insurance premiums for retirees reduced from 100% to $300 a month. No separate claim pool was set up for breaching existing contracts.

The IBEW contract had the most severe reductions – 5% pay reductions on 7/1/09 and again on 7/1/10 with no increases on 7/1/11 or 7/1/12 except for a few hard to fill positions. PERS pensions for new employees reduced to 2% @ 60 from 2.7% @ 55 and the employee contribution to PERS increased from 9% to 10%. Health insurance premiums paid by the city set at 75% and retiree health insurance set at $300 a month. No separate claim pool was set up for breaching existing contracts. All claims will be grouped with other unsecured creditors.

Vallejo’s unfunded pension liability at 6/30/09 was $74.8 million for public safety and $49.1 million for all other employees. The new employee contracts made modifications for new employees, but the existing programs remain in place for current employees. The city contribution to the PERS pension plan is now 37.558% of salary for safety and 23.30% for all other employees. Employee contributions to PERS were increased for IAFF and IBEW but not for VPOA and CAMP. The unfunded pension liability is still a major issue to be resolved.

Major provisions of the contracts.

Vallejo Pay and Benefit Summary - partial list (not a legal document – refer to actual contract for specifics)	VPOA to 6/30/12	IAFF to 6/30/12	CAMP to 6/30/13	IBEW to 12/31/12
Salary increase
7/1/09	0	-2.0%	0	-5.0%
7/1/10	6.29%	0	2%	-5.0%
7/1/11	1.3% est.	0	2%	0
7/1/12	To be negotiated	To be negotiated	2% to 4%	0
Unpaid furlough
7/1/10	0	0	2.3%	8 hours
7/1/11	0	0	2.0%	16 hours
PERS Pension	3% @ 50	3% @ 50	2.7% @ 55	2.7% @ 55
Employee contribution	9.0%	13.4%	9.0%	10.0%
New employees	3% @ 50	2% @ 50	2.7% @ 55	2% @ 60
Social Security Coverage	No	No	Yes	Yes
Medicare Coverage	Yes	Yes	Yes	Yes
Health Insurance paid by city	100%	75%	100%	75%
Hired after 2009	100%	75%	80%	75%
Retirees	100%	$300 month	80%	$300 month
Longevity Pay
20 through 24 years service	5%	0	5%	0
25 + years service	10%	0	10%	0
Hire after 2009
20 through 24 years	5%	0	2.5%	0
25+ years service	10%	0	5.0%	0
Special Pay
Education Incentive 1	3.0%	3.5%	0	0
Education Incentive 2	5.0%	5.0%	0	0
Motorcycle	2.5%	N/A	N/A	N/A
SWAT Team	1.0%	N/A	N/A	N/A
Bilingual	1.0%	1.0%	0	$75 per month
Paramedic or	N/A	10.0%	N/A	N/A
EMT (emergency med tech)	N/A	5.0%	N/A	N/A
Swing shift (4PM to midnight)				5.0%
Night shift (midnight to 8AM)				7.0%
Vacation Pay per year
0 through 4 years	100 hours	144 hours	80 hours	80 hours
More than 4 through 10 years			120 hours	120 hours
More than 4 through 12 years	150 hours	216 hours
More than 10 through 20 years			160 hours	160 hours
More than 12 through 20 years	200 hours
More than 12 through 23 years		288 hours
More than 20 through 26 years	240 hours		200 hours
More than 20 years				200 hours
More than 23 years		312 hours
More than 26 years	280 hours		224 hours
Max vacation accumulation	3 or 4 years	3 years	2 or 3 years	3 years
Sick leave per year	120 hours	216 hours	96 hours	96 hours
Maximum accumulation	Unlimited	Unlimited	Unlimited	Unlimited
Cash out on retirement or	100%	25%	50%	25%
Convert to PERS service credit	100%	100%	100%	100%
New hires	180 hours	216 hours	144 hours	96 hours
Cash out on retirement	None	25%	None	25%
Convert to PERS service credit	100%	100%	100%	100%
Holiday Pay per year	130 hours	156 hours	104 hours	104 hours
Maximum accumulation	0	3 years	0	0