DUNEDIN — Complications with fire pension negotiations have temporarily put talk about city employee raises on hold.
Dunedin's proposed 2012 budget includes a recommendation by City Manager Rob DiSpirito that employees, who haven't seen raises in two years, receive a 3 percent pay increase next year.
The City Commission had planned to use a budget workshop this week to hash out whether employees should receive a raise, one-time bonus or combination of the two.
But they hesitated to move forward when informed that the $832,000 in fire pension funds the city had anticipated receiving from the state is on hold because of legal questions.
If the funds don't come through, it will throw next year's budget out of balance, potentially jeopardizing raises as well as a proposed 6 percent reduction in the property tax rate.
"The fire pension money helped balance the budget," said human resources director Nancy Duggan.
Without it, she said, "we'll have to figure out what to do differently to balance the budget."
"That is a huge portion of the budget that we do not know right now if it's going to be in the checkbook next month or next year," Commissioner David Carson said. "So I would like to delay this discussion."
At issue is an ordinance under which the state agreed to return $832,000 in pension reserve money to city coffers to serve as reimbursement for extra benefits the city has paid out to firefighters since 1999.
Firefighters say they were promised half of the money during contract negotiations and had intended to use the money to establish a "share plan" — a retirement account in addition to their pension. Duggan said the state is investigating the fire union's claim that the city's proposal to give firefighters only 75 percent of future reserve money is illegal.
"(The state is) questioning a specific part of that ordinance having to do with the share plan," Duggan said. "We have a sent a response back saying we feel our ordinance is valid."
In a statement issued Wednesday, Dunedin Firefighters Association officials said they felt they were being unfairly blamed for the possible delay in employee pay increases.
"The city is trying to hold firefighters responsible for the city raises, when in fact it was the firefighters that asked the council to delay the final reading due to a problem with the ordinance," the statement said. "Firefighters are not responsible for budgeting. Therefore we feel this is nothing more than retribution for filing a grievance against the city and raising a question with the state as to the validity of the ordinance."
Duggan said she doesn't expect the state to decide on Dunedin's ordinance for at least three weeks. But she said at least six other cities have similar ordinances, so she believes the state will uphold Dunedin's.
If the fire pension money doesn't come through, the City Commission and city staff will have to figure out how to balance next year's budget. That includes possible debate over whether to change city policy, enabling officials to dip into the city's healthy reserves to fund the pay increases, or to find some other funding source.
The City Commission will discuss the matter at its next budget workshop, on Aug. 9.
Keyonna Summers can be reached at firstname.lastname@example.org or (727) 445-4153.