PURPOSE:

The purpose of this report is to request City Council approval of the proposed resolution which would approve the Fiscal Year (FY) 2004-05 Memorandum of Understanding (MOU) for the Burbank Management Association (BMA).

BACKGROUND:

Beginning in March 2004, the City began the FY 2004-05 negotiations with the various bargaining groups. The City reached agreement with the International Brotherhood of Electrical Workers (IBEW) in June, 2004; the Burbank City Employees Association (BCEA) in August, 2004; the Burbank Fire Fighters (BFF) in November, 2004; and the BMA in January, 2005.  The BMA members ratified their agreement on January 26, 2005 and are now requesting City Council approval. 

For many years, it has been the City�s policy to look at four basic cornerstones when considering compensation issues for its employees:

• The condition of the economy as reflected by the Consumer Price Index (CPI) for the Los Angeles-Riverside-Orange County Urban Wage Earners and Clerical Workers from April to April, 2004.  This year, that CPI was 2.40%.

• The capacity in the City�s approved budget is another criterion utilized in setting compensation for employees.  In FY 2004-05, the City projected deficits and each department implemented two to four percent budget reductions to mitigate this situation.  As such, the City�s tight fiscal restraints were a determining factor in the compensation packages proposed for this Fiscal Year.

• Commitment to pay for performance is an on-going philosophy for the City. In order to recruit and maintain quality employees to serve the needs of the community and citizens it is vital that we maintain this commitment even in the face of fiscal adversity.

• Equity in the marketplace as determined by market survey is the fourth criteria the City utilizes in setting compensation for employees.  In addition to the City�s own fiscal issues as cited above, the State is grappling with a huge budget deficit which will continue to impact local governments.  As such, the ability to pay market wages is and continues to be hampered by these budgetary considerations.  As a result of these constraints, the City and the BMA agreed not to survey the marketplace salaries for 2004-05, and instead continue to work on bringing salaries closer to the 2003-04 market survey.

ANALYSIS AND CONCLUSION:

It is within this difficult financial framework, staff is proposing City Council approval of an economic package for the BMA that does not exceed 2.52% of the General Fund.

In 2003-04, a twelve (12) city survey (Anaheim, Garden Grove, Glendale, Huntington Beach, Inglewood, Long Beach, Pasadena, Riverside, San Bernardino, Santa Ana, Santa Monica, and Torrance) was completed for the BMA.  In 2003-04, these managers were brought to approximately 51% of that total average market survey.  A 2.52% General Fund impact for FY 2004-05 would bring the BMA managers to approximately 100% of the FY 2003-04 market survey.  In addition, there are some non-General Fund positions that will be receiving equity adjustments to maintain internal equity and assist with on-going recruitment and retention efforts.

The proposed resolution will approve a total General Fund compensation package equaling 2.52% plus non-General Fund equity adjustments.   The 2.52% has been distributed among all positions under survey in accordance with each position�s market average.  The survey adjustments will automatically be given to all employees whose last performance evaluation was satisfactory or above.  The market adjustments provided to each position under survey range from 0.25% to 9.30% depending on the survey average for the position.   Those employees with less than a satisfactory performance evaluation will require department head approval to obtain any survey adjustment.  It is important to note that those positions that are over survey will not receive any survey adjustment. 

In addition to the economic portion of the package, there are some proposed changes to language contained in the MOU.  Some of the more significant changes include:

• Language to provide exempt employees with an internal appeal process for disciplinary actions.

• Agreement to work the remainder of this contract year to renegotiate the discipline and grievance procedure (this is necessary as the existing language is not clear and contradictory).

• Increase tuition reimbursement cap by $5,000 per FY, if necessary, to provide adequate dollars to reimburse member�s tuition reimbursement requests.

• Provide BMA with unspent Professional Development monies for FY 2004-05 to reimburse eye care insurance premiums, training programs, and purchasing of equipment that is not covered by the City.

FISCAL IMPACT:

The compensation package of 2.52% for the BMA is a total cost to the General Fund of $353,120.  The proposed salary increases were anticipated in the FY 2004-05 budget preparation.  However, the funds were not appropriated at the time of the budget adoption.  As such, budget amendments are required to appropriate the necessary funds from the Unappropriated Fund balance.

RECOMMENDATION:

Staff recommends City Council adoption of the proposed resolution approving the Fiscal Year 2004-05 Memorandum of Understanding with the Burbank Management Association.

Respectfully submitted,

Judie Sarquiz

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