Police contract has votes to pass

The Omaha City Council now has the votes to pass the proposed police contract next week, marking a key milestone in the long-running debate over pensions for police and firefighters.

“It is time to end the rancor,” Councilman Chris Jerram said. “This contract represents the first step in reforming the police contract, reversing decades of pension benefit increases.”

Jerram and Councilman Thomas Mulligan announced Thursday that they would vote for the contract, joining colleagues Garry Gernandt and Ben Gray, who already had announced their support. Four votes are needed.

The proposed contract, which runs through 2013, includes wage freezes for 2009 and 2010, pay raises in later years, and higher pension contributions from both taxpayers and police officers.

Jerram's hopes aside, it's far from certain that the council vote on Tuesday will settle the controversy over an estimated $620 million shortfall in the pension fund and the sentiment by some in the public that police and fire salaries and benefits are too generous.

The council rejected an earlier version of the police pact after Mayor Jim Suttle offered it last year.

More recently, Suttle's revised contract drew harsh criticism at community forums and a City Council hearing, and a group of business owners has aired advertisements in opposition.

Moreover, both critics and supporters agree that the plan's wage increases and $13 million annual pension fix are likely to result in an unpopular tax increase next year.

“The sentiment from the public has been about 100-to-1 opposed,” said Councilwoman Jean Stothert, who is against the contract.

Even so, there's little disagreement among council members that the new pact would help fix the city's troubled pension system. The contract would raise the retirement age and stop officers from spiking their pensions through overtime.

Council members differ on whether those actions will go far enough or take effect fast enough.

But Mulligan said he decided that the city would be better off with the contract's provisions than without them.

“This new agreement is not the panacea that we would all like to see,” he said. “But it's an excellent first step.”

The city has to negotiate contract provisions with the Omaha police union, rather than simply impose new rules, Mulligan said. That limits how much can be changed right now, he said, although more changes can be negotiated in future contracts.

“It's like an apple,” Mulligan said. “You've got to take it a bite at a time.”

Stothert said the pension changes in the proposed contract are too small to justify the cost or the length of the deal. Councilman Pete Festersen, another opponent, agreed.

“What's proposed is better than now,” he said. “It just isn't quite good enough.”

Jerram said the city has to start fixing the pension system now, even if the contract isn't perfect.

Actuaries have warned that the annual price tag will rise each year that the city fails to begin implementing changes.

“If we wait three years, that number goes up exponentially,” he said.

Jerram also said he spoke with labor relations experts who say it's more realistic to alter the pension program through gradual, steady changes than to expect to achieve a complete overhaul in a single contract. He said the city will return to the bargaining table in a few years to push for additional changes in the next police contract.

“The good news is that Omahans are unified by the need for reform,” Jerram said.

Passing a contract makes it more likely that the city will have to raise taxes as officials work this month on the 2011 city budget.

Suttle's budget proposal, which includes the contract's costs, calls for an increase in the city's property tax rate and a new 4 percent tax on restaurant, bar and catering tabs. Suttle also wants a higher wheel tax, earmarked for street maintenance work.

Council members are working on possible spending cuts and might change the mayor's tax plans.

But Mulligan and others acknowledge that the council probably will not cut spending enough to avoid some sort of tax increase, given the substantial increase in pension and payroll costs.

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