City won't have to borrow for $20 million in firefighter back pay
By Fran Spielman City Hall Reporter April 10, 2014 4:03PM
Updated: May 12, 2014 6:35AM
Chicago firefighters and paramedics will get more than $20 million in back pay without adding to the city’s mountain of debt, under a five-year contract that forfeits union givebacks for the possibility of pension reform.
Earlier this year, Mayor Rahm Emanuel persuaded the City Council to double — from $500 million to $1 billion — a so-called “commercial paper” program used to tide the city over between major bond issues.
Chief Financial Officer Lois Scott said then that the short-term borrowing program would “ensure the city has liquidity for unseen needs such as retroactive salary payments and judgments.”
But City Hall insisted Thursday that the more than $20 million needed to cover the back pay was tucked away into all-purpose “finance general” accounts in the mayor’s 2014 budget and that the tab would not be covered by borrowed money.
The contract gives firefighters and paramedics an 11 percent pay raise over five years, maintains staffing levels and bolsters ambulance service by converting all 15 basic-life-support ambulances to advanced-life-support.
The decision to end a two-tier system that paramedics have called a dismal failure would give Chicago 75 ambulances capable of providing the most sophisticated level of care.
It would also free up the equivalent of 30 firefighters, since each one of the city’s BLS ambulances are staffed by a pair of firefighter-EMT’s. The city has agreed to hire more paramedics — anywhere from 50 to 200, sources said.
“It’s sort of a back door way of getting variances” from the requirement that every piece of fire apparatus be staffed by at least five employees, said a source familiar with the agreement.
“Manning factors go down. There are more people available in firehouses. It’s a win-win.”
In addition, the contract calls for a six-member committee — three mayoral appointees and three designated by Chicago Firefighters Union Local 2 — to study the need for additional ambulances.
“The committee is to look at potentially putting five more ambulances into service by 2016,” said Ald. Nick Sposato (36th), a former Chicago firefighter.
“The BLS ambulance program did not work. Four thousand times last year, they sent a BLS ambulance and had to upgrade to ALS. To err on the side of sending ALS is fine. You certainly don’t want to send a BLS ambulance on an ALS run. Peoples’ lives could be in jeopardy.”
A top mayoral aide added, “Five more ambulances [for a total of 80] is certainly a goal the committee will be looking at. This is something the commissioner and the union feel strong about.”
The five-year agreement would require firefighters and paramedics who retire between the ages of 55 and 59 to contribute 2 percent toward retiree health care that’s now free. Police sergeants and lieutenants have already agreed to those terms.
But that’s among the only givebacks Emanuel was able to wring out of Local 2.
The mayor came up empty on his laundry list taking aim at such treasured union perks as: holiday and duty availability pay, clothing allowance, pay grades, premium pay, non-duty lay-up coverage, the physical fitness incentive and the 7 percent premium paid to cross-trained firefighter paramedics.
Nor did the union agree to Emanuel’s plan to have “double houses” that include both engines and trucks to be staffed by nine firefighters instead of 10.
Instead, the mayor settled for what sources called a “vanilla” agreement with a modest pay raise, in hopes of creating a “collaborative atmosphere” that will set the stage to solve the city’s pension crisis.
Next year, Chicago is required by state law to make a $600 million contribution to stabilize police and fire pension funds that have now have assets to cover just 30.5 percent and 25 percent of their respective liabilties.
Emanuel wants the General Assembly to put off the balloon payment until 2023 to lift the sword hanging over Chicago taxpayers and give him time to negotiate pension reforms with police and fire unions.
“If we had pushed on variances, manning or tried to go after junk pay and vacation pay, it would have ended up in interest arbitration, and the arbitrator would find an offset for it. We would have had to give up something else,” said a source familiar with the agreement.