Despite an offer by the City of San Antonio to continue premium-free health care coverage for approximately 2,400 police officers, San Antonio Police Officers Association negotiators came to the table Tuesday demanding additional concessions.
An earlier City proposal divvied up premium costs, with the City paying 80% and union members paying 20% to cover premiums for dependents. That plan, city officials said, would cost $11,300 in FY 2014 for each uniformed officer. The police union’s counter proposal presented Tuesday is closer to a 90-10%, which union health care consultant randy McGraw said would only take the per capita costs to $11,500.
The City currently spends $7,800 per year per civilian employee’s health care, and predicted union health care costs would soar to $20,000 per police officer in 2015 if left unchanged.
“Health care costs are estimated to increase 10% annually for each of the fiscal years 2015 and 2016, resulting in an estimated health care cost to the City of approximately $13,600 per employee for the health care plan options effective Jan. 2016,” states the City’s proposal.
On the surface, agreement by the two sides to agree on a four-year contract and a $200 difference in annual per capita costs suggest a deal is taking shape, but City negotiators seemed doubtful of McGraw’s numbers.
“Those numbers may not add up,” the city’s lead negotiator Jeff Londa said after the meeting.
Actuaries and the City’s health care consultant Buddy Morris will review the math on the union’s proposal and are expected to respond when the two sides meet again this Friday.
“The financial gap between the current proposals is about $39 million. Under the two new healthcare plans offered by the City, the maximum monthly premium an employee would pay for family coverage is $327/month. The Union’s proposal has a maximum monthly premium for family coverage at $127 /month,” stated the City late Tuesday evening via email.
One point of contention could be McGraw’s claim that if the City agrees to cap union member costs for out-of-network care, it can still realize $3 million in annual savings, a claim the city’s actuaries and budget officers are bound to challenge.
In 2014, McGraw said, $6.8 million was spent on out-of-network health care providers out of $27 million medical claims – meaning about 25% of payments were made out-of-network. For the average person, he continued in a phone interview after the meeting, they’ll go out of network for less than 5% of their costs.
“(Under the City’s plan) there’s not a very big penalty to go out-of-network,” McGraw said. The union’s plan provides more of a barrier by locking down out-of-network costs.
The counter proposal also would keep the 10-year evergreen clause and give uniformed police officers a pay raise in each of the contract’s four years equivalent to 13.4% over the life of the agreement, while the City has proposed a 9.5% pay increases over the life of the agreement that includes a 2% bonus payment for members in 2015 upon signing and then 2.5-3% raises over the next three years. Union President Mike Helle said the City’s lump sum/bonus plan, coupled with premium costs for dependents, would represent a pay cut for police officers.
The union’s counteroffer includes a 3% base pay raise at signing and again when the 2016 fiscal year begins on Oct. 1. For FY 2017, officers would receive a raise of 2% and 3% at the start of FY 2018.
“It gives us an opportunity to put some money on the table for public safety workers, (who are) out in the streets, to get a little bit of a pay raise,” Helle told reporters after the meeting. “For working people, when you get a bonus it’s only a one-time bump and you go back to your baseline salary. That’s not acceptable to us.”
Helle also called for Mayor Ivy Taylor and City Council to step in and tell staff to be more responsive to union demands.
“We’re not going to back up any (further) than we are, so if they’re … going to monkey around with ‘we’re going to tweak this and tweak that,’ then we’re basically going to be done and wait until the (May 9 City) Election,” Helle said.
Both sides claim their proposal is fair to uniformed employees and affordable to the City.
“I think we made some progress,” Londa said. “The union seems to be saying that health care costs paid by the City should be $11,500 to $12,000 per employee, if that’s the case, that’s acceptable to us. (However), we don’t think that their numbers quite add up that way and that’s what we’re going to look at between now and Friday.”
Londa said the City’s team was not deterred by Helle’s statement of a possible impasse, “People say a lot of things during bargaining.”
Both sides have agreed that the legacy health care plan should end on Jan. 1, 2016 and that the legal fund, available for any and all legal expenses of members, be phased out over the next three years.
The five-year police and fire contracts expired Sept. 30 and the City’s 2015 Operating and Capital Budget went into effect on Oct. 1, 2014. A cap was put on public safety spending at 66%, as recommended by the Healthcare and Retirement Benefits Task Force appointed last year by then-Mayor Julián Castro. The placeholder in the approved budget would have allocated a compromise sum of $10,000 a year to cover health care costs for each uniformed police officer and firefighter.
The City has since loosened its grip on that $10,000 figure, but it may not be enough for the union.
Because an agreement wasn’t made in time, the City would have started to run a $1.6 million monthly deficit on Jan. 1, which would have violated the city charter requiring a balanced budget. About $14.2 million was taken from the general fund in November to avoid this at the cost of other city departments but if a contract can be agreed to that costs the City less than the $14.2 million, funds will be redistributed back into the budget. The deferred street projects would take priority.
*Featured/top image: Police union (left) and City (right) negotiating teams meet to discuss the police union’s counter proposal. Photo by Iris Dimmick.
Read all the stories on the City and police union negotiations in the Rivard report archive.