Redding Mayor Wants More Permanent Concessions

Tuesday, October 06, 2009

REDDING - Mayor Rick Bosetti is hoping to win money- saving contract concessions in city employee retirement and health care coverage by asking voters to approve ballot measures to further trim Redding’s ailing budget. Bosetti’s ideas will be discussed at tonight’s City Council meeting, though council members will not vote on the proposal.

The city has cut nearly $13.7 million from its general fund over the past two years to bring spending in line with declining revenues. In September, officials learned sales tax revenues dropped 23 percent in the spring compared with the year before, 9 percent lower than projected, causing a budget gap of $350,000. Several unions have since conceded raises and agreed to furloughs to keep jobs in place and department doors open, but Bosetti said he wants more.

The first measure would require employees to pay their own contributions to their California Public Employees’ Retirement System accounts. Currently, the city pays both the employee and the employer contributions, according to a staff report. Bosetti said the city cannot afford to continue on the same course, but labor negotiations didn’t yield that concession. “I think there’s no doubt that at some point we have to find a mechanism that results in that,” Councilman Dick Dickerson said. “We can’t continue doing what we have been.”

Another area Bosetti proposes to change is employee retirement health care coverage, which represents an estimated liability of $85 million to $95 million, he said.  Instead of the current system, which subsidizes 50 percent of a retiree’s health care premiums indefinitely so long as the retiree worked for the city at least five years, Bosetti proposes a tiered system where the amount subsidized increases with the number of years worked for the city, he said.  “If there is consensus to look at doing this, we need to get staff direction on what to come up with for the ballot,” Bosetti said. Councilwoman Mary Stegall said she agrees with the idea of employees paying their own retirement contribution but doesn’t think a ballot initiative is the way to go.

“It seems to me that’s what we do as a City Council in our negotiations, not what we ask the voter to choose,” she said. Stegall questioned the amount of money it would take to put a measure on the ballot and said she needed to know more details about the proposal. Dickerson said a complete analysis of the amount of money involved in pensions would be necessary before he could decide on whether a ballot measure would be appropriate. “I am not convinced that all the intricacies are something that can be put on a ballot measure,” Dickerson said. “It’s complicated.”

Reporter Amanda Winters can be reached at 225-8372 .