Los Angeles Mayor Eric Garcetti on Thursday set the stage for a potentially messy confrontation with the City Council, saying he would refuse to sign a proposed salary deal with the politically potent union representing Department of Water and Power workers.
Local 18 of the International Brotherhood of Electrical Workers ran a fierce campaign against Garcetti, whose main argument in the mayoral election in May was that he could be trusted to stand up for DWP ratepayers.
In a written statement, Garcetti said the union-endorsed contract proposal included cost savings that were worth pursuing. But he said he could not approve it “because it limits further DWP reforms, specifically to the department’s costly and inefficient work rules.”
“The voters of Los Angeles have been clear — they want fundamental DWP reform and so do I,” Garcetti said.
But what the utility workers can’t get from the mayor, they could well get from the City Council. The council’s leaders have put the proposed four-year DWP labor pact on track for approval by Sept. 1, starting with a public hearing Friday.
City policy analysts have embraced the deal, highlighting its promise of three years without pay hikes; the postponement of a required October raise until 2016; and reduced pension benefits and a higher retirement age for new hires.
This is the first major union deal on Garcetti’s watch. His isolation on the issue — he is the only elected official to publicly question the proposal’s merits — underscores labor’s influence at City Hall, even after a campaign in which unions tilted heavily against Garcetti.
The momentum behind the proposed labor pact is drawing renewed attention to the millions of dollars the DWP union has poured into city elections. The IBEW spent $2 million on its fight against Garcetti and has shown a willingness to spend six-figure sums on independent campaigns to elect council members.
In 2011, political groups controlled by IBEW leaders put more than $614,000 into a campaign to unseat an adversary, Councilman Bernard C. Parks, and nearly $528,000 to elect a new Harbor-area council member — including just over $188,000 on the ultimate winner, Joe Buscaino. This year, IBEW affiliates donated $75,000 to the council’s failed ballot measure to increase the city’s sales tax.
Whether Garcetti can persuade the council to back him in seeking more concessions is far from clear. Councilman Paul Koretz, who backed Garcetti for mayor, said he was leaning toward approval of the proposed labor deal, calling it “one of the better contracts we’ve had historically” at the utility.
“There are folks that think we could make it better,” said Koretz, who won his office in 2009 with nearly $40,000 in support from IBEW affiliates. “I’m inclined to think there’s mostly downsides to continuing [negotiations] and not much upside.”
For Garcetti, the political dimensions of the deal are hard to escape. The union’s advertising campaign during the mayor’s race portrayed him as a leader who had indulged in luxury travel at public expense and whose mismanagement had driven the city to the brink of bankruptcy.
For weeks, Garcetti insisted the proposed pact didn’t go far enough in holding down costs at the DWP as it prepared to impose the next in a series of water and power rate hikes in the months ahead.
As council approval appeared more likely, Garcetti changed his tone and began to praise some of the deal’s cost-cutting features. He credited “the strength of the message” of his campaign.
“Nobody questions that this election changed the game,” he said, recalling his frequent pledge to be independent of the DWP union. “This was unimaginable five months ago.”
But his announcement on the eve of the council’s hearing raised the specter of a veto and the political drama of a council override. The council and union could adjust the deal to suit Garcetti, but that that would require accommodations from Brian D’Arcy, the savvy DWP union leader.
D’Arcy did not comment on Garcetti’s opposition to the deal, saying instead that he was looking forward to Friday’s hearing — and a discussion of “the significant reforms that have been negotiated and previously agreed to by the city.
“This agreement will save billions of dollars, create pension sustainability, and affordable rates for DWP customers for the foreseeable future,” he said in a prepared statement.
The union’s current contract doesn’t expire until the fall of 2014, but council leaders say they must act fast to stop an already approved Oct. 1 raise.
A spokesman said Council President Herb Wesson was searching for common ground between Garcetti and the DWP union. “What he wants to do right now is keep the discussions and the conversations going,” Wesson aide Ed Johnson said.
On Saturday, Wesson released an analysis from the council’s top policy advisor promoting the labor deal. Chief Legislative Analyst Gerry Miller’s report said the agreement would generate $4 billion in savings over 30 years, adjusted for inflation, and help secure concessions from other City Hall unions.
Without the agreement, other unions aren’t likely to forego raises or make “other concessions to reduce the city’s costs for employee healthcare,” Miller said.
City budget analysts acknowledged that the proposal would not change the utility’s practice of paying the entire cost of health coverage for its IBEW employees. By comparison, about one-fourth of the city’s workforce is now paying 5% of their healthcare premium and a few employee groups are on track to pay 10% next year, according to Miller.
The DWP said it would use salary savings from the proposed deal to offset some healthcare costs.
Miller also warned that there would be an “extremely high” risk of a strike if city officials failed to reach a deal. Utility disruptions, such as construction project delays, “would be very difficult to manage,” he wrote.
Garcetti said some of the deal’s supporters have overstated its benefits, particularly on healthcare.
On Tuesday, Gil Cedillo and Curren Price — the two council members whose campaigns this year were the most heavily backed by the DWP union — called on the DWP to draft a report on the financial impact of a strike. Cedillo praised the DWP union for making what he called a “generous” offer and warned of labor strife if the city were to rebuff it. “Shop stewards will get angry,” Cedillo said.
A campaign committee affiliated with the IBEW spent nearly $90,000 in support of Cedillo and more than $72,000 on efforts to elect Price.
Maria Elena Durazo, leader of the Los Angeles County Federation of Labor, has joined D’Arcy in urging the council to approve the deal. In an interview, she said she had talked with one or two members, urging them to “solve it without there being a dispute” and keep politics out of their deliberations.
“All I’m hoping and encouraging is: Look at the substance of it,” she said. “Look at the particulars of it, in terms of both the city’s interests, as well as the people who carry out the work.”