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Mayor Rick Baker taps expected utility taxes to give city union workers promised raises

Mayor Rick Baker wants to use an anticipated increase in utility taxes from Progress Energy to pay for the raises.

Photo by JAMES BRANAMAN

Mayor Rick Baker wants to use an anticipated increase in utility taxes from Progress Energy to pay for the raises.

ST. PETERSBURG — City union workers should be happy it's an election year.

After months of accusations, tension-stricken meetings and legal threats, Mayor Rick Baker has decided to honor the city's contracts with union employees, reversing his decision to withhold $2.3 million in raises.

City Council members and mayoral candidates running for election and angling for endorsements from the city's unions had denounced the wage freezes in recent months, putting an unusual amount of pressure on an administration whose budget decisions often go unquestioned.

Union officials played a significant role in the political drama, meeting individually with council members and candidates in recent weeks to get their voices heard.

"We really worked the political side of it," said Will Newton, president of the city's firefighters union.

Baker's latest budget proposal calls for the city to use a projected spike in utility tax revenue to help grant the city's 2,085 union workers their promised 2.5 percent wage increases.

Baker also set aside $300,000 toward 2.5 percent salary bonuses for nonunion workers earning $50,000 or less.

Baker, however, did stick to one budget promise: He refused to dip into the city's $286 million reserve, built up over the past decade as property tax revenue climbed.

Some council members and candidates suggested City Hall tap into the savings to cover a $12 million property tax loss.

Instead, Baker found additional dollars in his $207 million budget through several small cutbacks, including $70,000 earmarked for police overtime.

Council member Jim Kennedy, who recently introduced a City Council resolution requesting that Baker honor the union contracts and give pay raises to nonunion employees, said he was pleased with Baker's new budget.

"It's a little cut here, a little cut there, but it didn't necessarily have a lot more pain to it," said Kennedy, who is up for election in November.

Baker said the council's resolution prompted him to redraw his budget.

Faced with an $18 million deficit, Baker initially proposed balancing the budget by trimming the payroll. He eliminated 148 positions, most vacant. Management, professional and supervisory employees earning more than $50,000 were given 2.5 percent pay cuts.

Baker also announced a citywide wage freeze, a proposal that was denounced by union officials who claimed the mayor was using the tough economy as an excuse to ignore financial obligations. Union officials threatened to sue for breach of contract.

Baker said he would rather eliminate more jobs than touch the reserves, which should be saved for years of greater economic woe or potential catastrophes like hurricanes.

"Frankly, it's the fiscally prudent thing to do," Baker said.

Union officials met with Baker and his staff six times in August, including a brief meeting Friday morning, to reach a compromise.

Ultimately, a recent notice from Progress Energy is what saved the day. The company advised City Hall it stood to earn an additional $3 million in annual utility taxes in 2010 because of the company's expected rate hike.

Florida regulators are still considering the request to increase rates starting in January.

Under the new budget proposal, Baker plans to use nearly $2 million in utility tax revenue to balance his budget. Roughly 450 nonunion employees also will receive one-time bonuses.

"What it shows is that if you are willing to sit down and offer solutions back and forth on both sides, that you will be able to find solutions," said Alphonso Mayfield, president of the Florida Service Employees International Union.

Cristina Silva can be reached at (727) 893-8846 or csilva@sptimes.com.

Mayor Rick Baker taps expected utility taxes to give city union workers promised raises 08/28/09 [Last modified: Friday, August 28, 2009 11:12pm]
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