L.A. city workers rally over bank deals as bargaining continues

City workers and labor activists marched through the streets of downtown Los Angeles Oct. 28, demanding that city leaders step up pressure on Wall Street banks to renegotiate deals they say are costing the city.
(Marcus Yam / Los Angeles Times)

A large crowd of city workers, labor activists and their allies marched downtown and packed the stairs of City Hall on Tuesday, demanding that city leaders step up pressure on Wall Street banks to renegotiate deals they say are costing the city.

The protest comes as bargaining drags on between employee unions and Los Angeles. Fliers urging workers to attend the march and rally declared, “The city wants you to pay $1,690 or more a year for health insurance!” and “Stand up for yourself and your family!”

Currently, L.A.’s civilian workers can choose health plans that don’t require them to pay anything toward the premium cost. If employees had to chip in 10% -- as city lawmakers assumed in their budget for this year -- the added annual expense for family coverage could exceed $1,690, according to the Coalition of L.A. City Unions.


But those at the Tuesday march and rally mostly argued that city lawmakers needed to recoup taxpayer revenue from Wall Street banks to restore city services and create jobs. Union officials say their bargaining is deeply tied to those concerns.

At rallies and in the media, the labor coalition has stressed its ties to community groups that joined it in the Fix L.A. Coalition, a network of nonprofits, unions and clergy advocating to restore city services such as school crossing guards and street repairs.

“We got the solution to fix L.A.,” said the Rev. William Smart Jr., head of the Los Angeles chapter of the Southern Christian Leadership Conference, on stage during the rally. “The solution is: Get the money from the banks – they ripped us off.”

At the Tuesday events, demonstrators in ghoulish masks and costumes carried signs denouncing “the Grim Reapers of Wall Street.” Workers sported stickers that said, “Our Families’ Healthcare, Not Wall Street Welfare” and chanted, “Banks got bailed out, we got sold out!” Union officials estimated as many as 1,000 demonstrators attended.

“We need to restore the jobs that were lost to libraries,” Joyce Cooper, senior librarian at the Central Library branch, told the crowd Tuesday. “We need to keep our libraries open.”

The Fix L.A. Coalition has taken aim at borrowing deals with two banks, which were meant to lock in historically low interest rates. When rates fell after the economic recession, however, the city ended up paying more than the market rate.


City lawmakers voted earlier this year to try to renegotiate those deals, but labor leaders say no action has been taken yet by the city.

“There’s nothing happening at the table – nothing,” SEIU Local 721 President Bob Schoonover said of renegotiating the bank deals at the rally. “That’s why we’re here.”

The unions and their allies are pushing for City Atty. Mike Feuer to file a complaint with the Financial Industry Regulatory Authority, the largest independent securities regulator in the U.S., arguing that underwriters violated the principle of “fair dealing.”

Earlier this month, Feuer submitted a confidential report to city lawmakers on possible legal claims that the city could pursue against the banks. However, his spokesman Rob Wilcox said that because it was a confidential report, he was unable to comment on the issue.

City budget officials argue that the deals did save the city money -- though not as much as originally expected. Because the deals were tied to a wastewater bond, any money saved could be used on only wastewater projects, City Administrative Officer Miguel Santana said.

Terminating the deals could cost the city as well, he added. “I personally asked both [banks] if they would allow the city to terminate the swaps without a penalty,” Santana said. “Both of them have said they would not do that.”

At the end of the rally, seven young children carried wagons filled with thousands of petitions up the steps of City Hall to deliver to city officials. The children were all wearing red capes, most of which said “Fix LA” on the backs.

Bargaining between the city and the unions has been strained. The city has filed claims against the unions, accusing them of obstructing the bargaining process. The unions have countered that none of their actions amount to a refusal to bargain.

Besides expecting employees to chip in for their health insurance premiums, the city budget also assumed that civilian workers would get no salary increases this year.

In April, Santana recommended that city leaders hold off on employee raises for three years, in order to bring the budget into balance by 2018. The unions in the coalition previously received salary increases of around 25% over the course of seven years.

“I don’t want to take three or four more years of cuts with no raises. Do you? Seriously, DO YOU?” bargaining team member Michael Hunt wrote in an email to some city employees last week, urging them to walk off the job for the protest.

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