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Wednesday, Aug 17, 2022
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City of San Fernando Avoids Layoffs to Close Budget Deficit

The San Fernando City Council recently approved a labor agreement that avoided layoffs by reducing city employee benefits, in an effort to help close a projected $645,000 General Fund deficit. The agreement was reached Oct. 8, after nearly seven months of labor negotiations between the city and SEIU Local 721, and after the council unanimously rescinded layoff notices last month sent to 15 fullc]time city employees. cgBoth sides brought sacrifices to the table that keeps our city whole and the City family together in these trying economic times,ch said Mayor Pro Tem Mario Hernandez. cgWe [the council] know that our decisions are more than just about numbers,ch Hernandez said. cgItcfs about people, their families and livelihoods. By rec]opening those negotiations and as a result of the concessions made on both sides, we were able to avoid layoffs while still saving the city over half a million dollars.ch The city is facing a deficit as a result of declining property and sales taxes, and the recent State revenue takec]always. The city is also anticipating an additional loss in sales tax revenue from the potential closing of a regional auto dealership. The layoffs could have saved the city $600,000 this fiscal year and almost $800,000 in the next. Nearly 60 percent of the General Fund budget is personnel costs. cgTherecfs no doubt that 2010 will be a difficult year for the city,ch said Councilmember Maribel De La Torre. cgBut we [the Council] look forward to forging our partnership with SEIU and our employees to find solutions that keep the City financially sound, while maintaining jobs and providing services to the community.ch Both parties will sign the agreement on Oct. 27. The threec]year agreement applies to the citycfs general bargaining group, which represents about 70 employees. Among the contractcfs key provisions, employees will see no salary increases for three years unless the citycfs General Fund reserve meets a minimum of 10 percent after expenditures. City employees will also see a reduction in longevity pay from five percent to three percent after 10 years of service, from seven percent to four percent after 20 years of service, and from 10 percent to five percent after 30 years of service. The contract includes a costc]sharing arrangement that requires employees to pay two percent of their salary into the citycfs retirement system this year, and four percent the following year. Under the agreement, employees who retire by June 30, 2010 can use their highest 12 months of salary for final compensation under the citycfs pension program. Andrea Alegria

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