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Terms of Endearment Deal: ERIP or Ripoff?

The battle over the $405 million city budget deficit is far from over despite all the self-congratulatory back-slapping and expressions of undying love last Friday.

The terms of endearment agreed to by the 22,000-member Coalition of City Unions and a unanimous City Council — with the exceptions of Tom LaBonge and Tony Cardenas who didn’t bother to show up to deal with this crisis — provides only $78 million in total savings.

Some $20 million of that goes to restoring part of the $100 million already stolen from the emergency reserve fund. The rest goes into the general fund to pay the full the cost over 15 year for the Early Retirement Incentive Package (ERIP) for 2,400 lucky workers who get to retire as young as age 50 with the five years of service credits.

City workers’ contributions will rise from 6 percent to 7.07 percent instead of the 6.75 percent in the June 26 deal. The early retirees getting a 12.5 percent boost in their pensions also will pay 1 percent for 15 years.

Other terms include deferring this and next year’s cost-of-living raises for two years, requiring overtime be paid in compensatory time-off not cash, furloughs that amount to 30 minutes a week for the rest of year and half pay for holidays with the rest in more comp time,

As many workers will be transferred from general fund jobs to the Harbor, Airport and DWP — especially the DWP — payrolls whether they are needed or not since those are independent agencies with their own revenue streams and almost no effective public scrutiny.

They also will be looting all three agencies for services — real or ficititious — as much as they can get away with.

Then, there’s the pay-later provisions: Cash payments for unused sick time normally made in January will be paid next August, the $15,000 golden handshake for early retirees will be paid next year and the year after, boot and uniform allowances will be paid next year as will City Attorneys fees to the California Bar.

In addition, any workers who wants an 8-day, 72-hour work schedule can have it and pensions will only be calculated with one of the many regular bonuses offered city workers to do their jobs instead of adding them all up.

Finally, if the economic miracle that this deal depends on actually comes true, much of the money will go back to city workers.

That’s the deal, at least all we know about it, thanks to the unions sharing the information to their members, information our elected officials refuse to divulge because they don’t see any reason why taxpayers should know what’s really going on.

Not all city workers are happy about this.

The Engineers and Architects (EAA), for instance, get screwed again with one furlough day every two weeks, which is equal to a temporary 10 percent pay cut, and now will be hit with the only layoffs as well. As I understand it, 400 of EAA’s 6,600 members — city planners, technology people, auditors, criminalists and other white-collar professionals — will get the axe because they have refused to be taken over so far by the SEIU which so deftly uses members’ money to buy our city officials.

There’s also a rump group of troublemakers who have set up LA CITY WORKERS.com . in an effort to build opposition to approval of the deal.

Fat chance. The vote on the deal will take place at a public meeting in two weeks where anyone who stands up to the union bosses is putting their life, at least their working life, on the liine.

An even bigger problem exists: Firefighters and police officers.

The deal approved by the Council on Friday furloughs cops one day every two weeks, halts hiring of new officers, puts cadets on notice of termination after completing their training and bars the Fire Department and Police Department ” from entering into any new personal services or consulting contracts to perform work that would have been performed by sworn employees subject to the furloughs, layoffs, or other position reduction measures.”

These provisions are nothing but a public relations exercise and bargaining tool.

They know damn well the public wants cops and firefighters protecting lives and property a lot more than the hundreds of millions of dollars spent every year on social welfare programs and salves to special interest communities.

They count on us crying out against against the perils of anarchy in this gang-infested city and the perils of fire, flood and earthquake without adequate emergency services.

What this is about is giving the leaders of the fire and police unions, whose contracts expired three months ago, an excuse to make the same kind of modest concessions the other unions have made.

The trouble is deferring payoffs and raises until next year or the year after doesn’t solve anything at all.

City Hall doesn’t have the skill or the will to keep costs under control as they have promised as part of this deal and their rosy estimates of revenue will almost certainly fall short of reality.

The likelihood is that the city will face a cash crisis before this fiscal year is over. The certainty is that the city’s financial condition will be much worse next year and the years after as the deferred bills come due and pension costs double and triple.

More than a year ago, I said LA had reached the point of no return. Things have gotten a lot worse since then and the actions of the mayor and City Council have compounded the depth of the problem.

If the business community and the residents of the city don’t make a stand now and come together to take back City Hall, it will be too late when the libraries and parks close, the 911 emergency calls go unanswered and chaos ensues.

It’s now or never.


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6 Responses to Terms of Endearment Deal: ERIP or Ripoff?

  1. Anonymous says:

    This deal better work or the Mayor’s political career, and the career of Eric Garcetti, are toast.

  2. Anonymous says:

    How can anyone on City Council even entertain running for Mayor in three years if the city goes bankrupt under their fiscal shell game?
    Most of us live in the real world with budgets, due dates and the reality of a slowing economy. These politicians operate behind the golden horseshoe of fantasy land where they are sustained by photo ops, ribbon cuttings and backslapping.
    Their day is coming…

  3. Anonymous says:

    4:15 PM , simply they have no brains. You have not figured it out as yet?

  4. Charlie Baker says:

    On a side note, that “oral vote” was pretty lame. Normally they default “yess” vote in the bathroom, now they are voting “old school” just to get their egos stroked.

  5. Anonymous says:

    If the business community and the residents of the city don’t make a stand now and come together to take back City Hall, it will be too late when the libraries and parks close, the 911 emergency calls go unanswered and chaos ensues.
    It’s now or never.

    HA, WHEN HAVE I HEARD THAT BEFORE. IT’S BEEN THE SAME DIRE PREDICTION, EVERY WEEK.
    … we may need a crisis. have you seen one? then, let’s make one available.

  6. Excellent. This is the first place that outlines most, if not all, of the Terms Of Endearment. It would be nice to have the CAO’s summary.
    But the key is to follow the cash. And watch for the rating agencies to ding the City’s bond ratings.

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