Eases Residency Requirement
DC 37 Pact Has 9.42% Raise

By RICHARD STEIER

District Council 37 has reached a tentative contract agreement that provides 9.42 percent in raises over 32 months, offers a needed infusion of cash to its welfare fund and permits members to live in six nearby state counties outside New York City.

The Chief-Leader/Pat Arnow 'A GOOD, FAIR CONTRACT': With District Council 37 Executive Director Lillian Roberts and Labor Relations Commissioner James F. Hanley looking on to his right, Mayor Bloomberg trumpets 'a good, fair contract that rewards the everyday heroes that keep the city running.'

During the July 17 press conference announcing the deal, Mayor Bloomberg noted that the residency law governing civilian employees was enacted 20 years ago "during an era when many middle-class families were leaving the city for the suburbs. A lot has really changed since then. One of our big problems is a lack of housing, and laws that exacerbate that don't really help."

'Mayor Listened to Us'

DC 37 Executive Director Lillian Roberts thanked Mr. Bloomberg "for listening to us" on the residency issue. "I have plagued the Mayor to death about housing. I think our members will be very happy with this contract."

MARK ROSENTHAL: Residency change is key.

The terms appeared to provide a much-needed boost for Ms. Roberts, who came under heavy fire both internally and among other municipal union leaders for her previous wage deal.

That accord, which other union officials said set an unjustifiably low pattern for other municipal bargaining, granted just 6 percent in raises over three years, with 2 percent of the hikes generated by productivity measures that included reduced salaries for new hires.

"We needed to get sound wage increases and resources for the welfare fund," DC 37's chief negotiator, Dennis Sullivan, said in an interview prior to the press conference. "We had to deal with the equity fund, and we got the Mayor to ease the rules on residency. We were able to get very good things for our members without [negatively] affecting health or pension benefits."

Locals Split on Deal

His management counterpart, Labor Relations Commissioner James F. Hanley, said, "I think it's a settlement we can all be comfortable with."

DENNIS SULLIVAN: Good gains, no givebacks.

The tentative deal, which must still be ratified by rank-and-file members, was approved by 23 local presidents, with 18 opposed. Several local presidents abstained, and others did not vote because their members are not covered by its terms. Those include members whose contracts are with the state and trades workers who are in prevailing-rate titles whose salaries are set by the City Comptroller.

The initial hike, which would be consistent with the final year of pacts reached beginning last fall by unions representing Teachers and several groups of uniformed employees, would be 3.15 percent, retroactive to July 1, 2005. Effective Aug. 1 of this year, there would be a 2-percent raise, and next Feb. 1, salaries would increase by 4 percent. The value of the raises, once compounding is considered, is 9.42 percent.

The change in residency requirements is a breakthrough that is likely to be extended to other unions representing civilian employees. It places DC 37 members on the same footing as uniformed workers, who under the Public Officers' Law are permitted to live in Nassau, Suffolk, Westchester, Rockland, Orange and Putnam counties.

STU LEIBOWITZ: 'Alleviated retiree concerns.'

One condition of that change, which would require an amendment to the city's Administrative Code, is that those who lived outside the five boroughs would have to agree to pay the city income tax.

'Can't Afford to Live Here'

Civilian employees who were hired in mid-1986 or later have been required to live in the five boroughs, something that was partly intended to increase the minority work force. Motor Vehicle Operators Local 983 President Mark Rosenthal, who pushed hard for the easing of the residency requirement, said he believed the Mayor agreed to it because "he knows no one can afford to live in the city." DC 37's members, who prior to this deal had an average salary of about $29,000, are among the lowest-paid municipal workers.

For several years, DC 37's Health and Security Fund, which provides benefits ranging from prescription drugs to optical coverage, has been operating with reserves below what is recommended by the City Comptroller. On one occasion two years ago, the shortfall triggered a nasty battle between Ms. Roberts and her opponents on the union's executive board who claimed she did not do enough to address the problem for fear that significant increases in member drug co-pays would hurt her politically.

Bitter Foes Unite

Concern about the fund's condition became obvious when Mr. Rosenthal was joined in championing a significant increase by James J. Tucciarelli, the president of Sewage Treatment Workers Local 1320. The two men are on opposite sides in DC 37, and the personal dislike between them has been so strong that they nearly came to blows a few years ago.

The contract offers a cash infusion to the fund in two steps: a recurring $100 increase in the city's per-member contributions that will be retroactive to July 1, and a one-time payment of $166.67 per-member on Nov. 1 that covers retirees as well as active workers. Those two payments will generate over $40 million for the welfare fund, according to Stu Leibowitz, the president of the DC 37 Retirees' Association.

"The contract alleviated the concerns of retirees," he said. "We're big utilizers of the Health and Security Fund."

'No Givebacks a Key'

Mr. Leibowitz added, "We're quite pleased that in the Bloomberg Era we've got a contract with no givebacks."

Concessions of various sorts, from reduced starting salaries and pay scales for DC 37 and most uniformed unions during the last round of bargaining to two consecutive agreements by the United Federation of Teachers to have its members work longer for part of a pay hike, have been a hallmark of Mr. Bloomberg's labor dealings.

This time, he pressed DC 37 to accept a proposal that would have required future employees to work longer and contribute more to the pension system while receiving a smaller retirement benefit. In the final negotiations, that matter stayed alive only in the form of a special labor-management subcommittee that will discuss future changes. A subcommittee will also be tapped to consider whether salary adjustments are needed in some titles because of recruitment or retention problems. The traditional avenue for addressing special salary needs has been an "equity" fund, and under the tentative deal, money equaling .34 percent of a point will be devoted to that purpose.

Dissenters' Reasoning

While Mr. Rosenthal broke ranks with the majority of the executive board that has frequently clashed with Ms. Roberts, numerous other members of that group voted against the terms or abstained.

As one person familiar with the thinking of the deal's opponents put it, "They felt that with a budget surplus of $5 billion, the shabby contract last time, and the increases in the cost of living in areas like rent and gas, it wasn't enough when we haven't kept pace with the cost of living."

The Mayor's Office of Management and Budget concluded that the cost of living in the city rose by 3.9 percent last year, but has pegged this year's inflation rate at just 2.9 percent and projected the rate for 2007 to be 2.5 percent. Those projections are significantly lower than the Consumer Price Index for Urban Consumers that is maintained by the U.S. Bureau of Labor Statistics, which found a 4.2 percent jump in living costs in May compared to a year earlier.

Thinks Deal Will Fly

It was the BLS number that prompted Lynn Taylor, president of New York Public Library Local 1930, to vote against the deal. "To take a less-than-inflation contract is not acceptable," she said. She added, however, that she believes the deal will easily gain ratification, in no small measure because she believes her members and the rest of DC 37's rank and file had low expectations.

"Not having any givebacks, saving the welfare fund and the 4-percent bump in the last year are going to be big selling points," Ms. Taylor said. "They're also going to look at the fact that they're getting 5.15 percent [in raises] by next month, and a big retro check. It's very cleverly constructed."

Grapple Over Leverage

A day after the accord was reached July 12 in a marathon bargaining session, UFT President Randi Weingarten contended that the bargaining coalition of 20 unions she helped form last month had given DC 37 the leverage to get terms beyond what seemed achievable just a couple of weeks ago.

During the press conference four days after that announcing the deal, Ms. Roberts indicated that had played no role in the talks, saying, "I was talking to the Mayor; I wasn't looking back at any coalition."

Mr. Bloomberg quipped, "Success has many friends. If Randi was helpful in getting us together with DC 37, I would like to say thank you for the assistance."