Council OKs Proposed Pact With DWP Workers

Over the strenuous objections of two of its members, a majority of the Los Angeles City Council agreed Friday to a proposed new labor pact with the Department of Water and Power’s largest union, preparing the utility for massive layoffs before deregulation of electrical utilities forces the city into the competitive market.

But after the lengthy closed council meeting, even the union the council intended to help wasn’t happy. Brian D’Arcy, business manager for the International Brotherhood of Electrical Workers, said the council attached a condition to the contract’s retirement benefit package that is unacceptable to his union, most of whose members are service and line workers.

“The whole thing may well unravel on that point,” D’Arcy said.

The package, which was approved on a 10-2 vote, was aimed at enticing workers to retire rather than face demotion or, possibly, termination. The condition limited the length of time the principal enticement, which is part of the retirement package, will remain available. By approving the limit, however, the council cut the cost of the package by an estimated $100 million.

The council also gave DWP General Manager S. David Freeman authority to negotiate a similar deal with the utility’s other two unions, which will take the hardest hits in the upcoming layoffs.

But the plan’s potentially high price tag--at a time when the DWP faces huge debts--led council members to encourage Freeman to seek a lower-cost alternative, particularly in the retirement benefit.

“The goal is to make the DWP, without a single increase in rates . . . the most efficient utility in America,” said City Councilwoman Jackie Goldberg, who supported the package. “We think this is the best way to do that.”

The DWP, the nation’s largest municipal utility, is attempting to pay down $4 billion of its $7.5-billion debt by 2003. To that end, the utility is attempting to cut 2,000 jobs.

But Councilmen Nate Holden and Joel Wachs, who held a rare joint, impromptu news conference after the closed meeting and who cast the dissenting votes, said they believe the package is overly generous with taxpayers’ money.

While negotiations--and calculations--continue, officials said the labor pact could cost about $350 million, most of which comes from the DWP’s overfunded retirement pot.

“This is the most generous offer that has ever been made to a group of city employees,” Wachs said. “I believe this is wrong. This is basically the council using taxpayers’ funds . . . to curry favor with the unions.”

Holden charged that “the majority of the council has been hoodwinked once again. . . . Who wouldn’t take that sweetheart deal?”

But D’Arcy, whose powerful union the council hoped to win over to ease the political repercussions of the layoffs, said he will meet with union leaders next week to determine their next step.

Freeman said he believes that the unions should accept the deal before layoffs become necessary and employees are forced to leave without the bonuses.

“I think this is a message to the three unions to get off their high horse and reach agreement so their employees can take advantage of these benefits,” he said. “I’m going back and forth from being Attila the Hun to Santa Claus.”

An internal document obtained Friday by The Times shows that the utility expects 2,161 employees to be eliminated by February. Of those, 1,275 would retire, 450 would resign and 436 would be forced to leave.

The plan gives employees who are close to retirement the ability to add up to five years on their service level or age to be eligible for retirement. The city allows workers to retire when they reach 50 or when they have worked for 30 years.

But D’Arcy said the council decided to make that option available only for three years. He said that limit is unfair to his members, who may confront additional rounds of downsizing, and he wants the option extended indefinitely for those workers covered by the contract.

The plan also came under fire from Bob Duncan, who represents the Architects and Engineers Assn., which is expected to take the largest hit in the layoffs.

“That package is fine for [the electrical workers union], but it won’t work for us,” Duncan said. “We’re not asking for more money, we’re asking for a better-designed plan for our members.”

Although council members say negotiations are continuing, they say the package is the best and most palatable way to cut jobs and to prepare the utility for deregulation.

“It’s going to save us a lot of money in the long run,” said council President John Ferraro.

“We’ve got to save the DWP,” said Goldberg. “That’s our mantra: ‘We’ve got to save the DWP.’ ”