Proposed Costa Mesa union contract’s pay and pension perks focus on ‘recruitment and retention’
Based on a discussion at Tuesday’s City Council meeting, a proposed new contract with members of the Costa Mesa City Employees Assn. is a matter of pensions vs. retention.
Those two issues were among the major topics during the first public hearing on the city’s tentative agreement with the union that represents the city’s nonpublic safety employees.
If approved, the proposed pact would run through June 30, 2020. The union’s 236 members would receive 2.5% pay increases in each of the first two years of the deal, with 2.75% raises in the third and fourth years.
The contract also would decrease the amount those employees pay toward their pensions from the current 17.04% to 12% by the third year.
A major motivation for the proposed changes is that Costa Mesa has run into difficulties competing with other cities to attract new employees and keep them around for the long haul, said Assistant City Manager Tammy Letourneau.
“Recruitment and retention in the city has been a challenge for the last few years,” she said Tuesday.
Generally speaking, Letourneau said, Costa Mesa employees have lower salaries compared with surrounding cities, “and that’s where our recruitment pool comes from. So we’ve experienced challenges in filling our vacancies.”
The city currently has 90 vacant positions, according to Letourneau.
The CMCEA’s previous contract expired in June. A provision in that contract required union members to pay 60% of any increases in the city’s required contributions to the California Public Employees’ Retirement System.
“That has been significant,” Letourneau said. “I believe it’s been a huge contributor to employees leaving. It’s also a big consideration for trying to get employees to come work here.”
That provision would be eliminated in the proposed deal.
Some people at the council meeting, though, questioned the wisdom of lowering the employees’ retirement contributions given the extent of the city’s pension debt, which totaled about $246 million in 2015.
Councilman Allan Mansoor said the city needs to start looking at ways to decrease that liability.
“We can say, ‘Yes, we need to offer good benefits to be competitive with other cities’ ... but it doesn’t change the fact this is going to add to our pension burden considerably,” he said.
It’s especially concerning, he added, since recent projections show the city could face growing annual budget deficits ranging from $2.5 million in fiscal 2018-19 to almost $7.8 million in 2021-22.
The proposed CMCEA contract is expected to cost taxpayers $5.65 million more over the life of the agreement than the previous one.
“The reality is that we have pension plans in place that are absolutely unsustainable,” Councilman Jim Righeimer said. “Does that mean our employees are bad? No. They’re good people. But nobody outside of government has anything close to this kind of pension plan.”
Mayor Pro Tem Sandy Genis said that although the city needs to deal with the pension issue, “we also have to provide services for our residents, and that means having people in important positions throughout the city.”
The California Public Employees’ Pension Reform Act stipulates that starting in 2018, cities can’t require nonpublic safety employees to contribute more than 8% of their pay toward their pensions — though employee associations can agree to do so, according to Councilman John Stephens.
Even with the decreases outlined in the proposed contract, CMCEA members would still be contributing at a higher rate than that, he noted.
The contract is scheduled to return to the council for a second hearing and possible adoption March 7.
Parking spaces
For all the talk about pensions Tuesday, council members spent even more time parsing parking.
After a hearing that lasted about an hour, the council voted 4-1 to approve a request from the owners of Watch Connection to reserve two parking spots in a commercial center at 3033 Bristol St.
The two spots are right in front of Watch Connection and will be open only to its customers between 11 a.m. and 2 p.m. Tuesdays through Saturdays.
Finding spots in the area’s shared parking can be a challenge because the center is home to several popular restaurants and other businesses.
Though onsite valet parking is available, Watch Connection representatives said Tuesday that they requested reserved parking to ensure that vendors and customers purchasing high-end merchandise can park and walk safely to and from the store.
The Costa Mesa Planning Commission denied the request in November, saying that allowing a single business to reserve parking could create a problematic precedent or lead to overflow parking in nearby neighborhoods.
The council’s vote Tuesday reversed that decision.
Stephens said he supported granting the request because it sets aside only the two spots for a total of 15 hours a week.
“I don’t think it’s a lot to ask,” he said. “I think it’s a pretty easy decision.”
Righeimer, who voted against the request, said he didn’t think the city should get involved in the business of managing the center.
Twitter: @LukeMMoney
