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City of Peoria Press Release

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Council Action Expected to Address Union Impasse

Declaration of Emergency Due to Fiscal Crisis is Administrative Step


PEORIA, Ariz. (April 16, 2009) – The Peoria City Council is expected at next Tuesday’s meeting to take an administrative step to overcome an impasse in negotiations with its police officer’s labor union.

A resolution “declaring an emergency due to a fiscal crisis” is on the agenda for action. The resolution is an administrative provision in the agreements with Peoria’s public safety labor unions that allows the City Council to make final determinations when collective bargaining fails during times of financial stress.

“Unfortunately we could not reach agreement on the subject of pay raises. Though we’ve been clear with our employees about the financial constraints, the police union is still insisting on regular 5% step increases for their officers, so we’re asking the City Council to make this declaration,” City Manager Carl Swenson said. “It’s a tool available to us under our labor agreements, and in light of the budget realities we’re facing, we need to use it.”

In the midst of unprecedented spending cuts forced by a drastic drop in revenues, the city enacted a pay freeze for managers in January, and for all other employees starting July 1, pending City Council approval of the proposed Fiscal Year 2010 budget.

A zero-pay-raise agreement has been tentatively negotiated with employees who are represented by the American Federation of State, County and Municipal Employees; similar negotiations with Peoria’s fire fighters union are ongoing.

The Memorandums of Understanding (MOU) between the city and its employee labor unions provide that, in the event of a fiscal crisis declared by the City Council, the city may re-open the MOUs to achieve cost savings.

Despite the dire wording necessary in the administrative action, the city does not expect any damaging effect to Peoria’s credit rating.

“The financial agencies who determine our bond ratings have been positive about our financial policies and our recent budget reductions,” according to Brent Mattingly, the city’s chief financial officer. “They have indicated that this action will be seen as another proactive step to control spending, which is what financially responsible organizations are expected to do.”

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