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Posted on Wed, Jan 19, 2011 : 6:02 a.m.

Ann Arbor officials tapping state mediators to help reach new bargaining agreements with unions

By Ryan J. Stanton

Ann Arbor officials are asking the city's labor unions to make shared sacrifices to help close a $2.4 million budget shortfall for the next fiscal year starting July 1.

City Council Member Stephen Rapundalo, chairman of the council's labor committee, gave a detailed report Tuesday night on the status of negotiations with the city's bargaining units.


Stephen Rapundalo

Ryan J. Stanton |

"The city, for its part, is continuing to negotiate with all of its unions in good faith to achieve agreements which assist the city in achieving its financial goals," said Rapundalo, D-2nd Ward.

"In upcoming council meetings, I'll be doing further updates and also highlighting what the current contracts' elements are, so the public can better understand what they currently have and what we are trying to seek in terms of concessions."

Rapundalo said the city and the firefighters union have been negotiating since February 2010 on a new agreement and have used the services of a state mediator on three occasions.

The previous agreement with the firefighters union expired June 30.

In negotiations with the police, Rapundalo said the city now has filed a Public Act 312 petition to begin the process of binding arbitration with the Ann Arbor Police Officers Association.

"The parties are in the process of choosing the arbitrator who will handle the Act 312 hearing," he said, noting the last contract expired June 30, 2009. "And you'll remember that the last negotiation with the AAPOA also ended in binding arbitration."

The city also is negotiating with the police service specialists, as well as the city's chapter of the Command Officers Association of Michigan. Both groups' contracts expired June 30, 2009.

"The city has continued to negotiate with the COAM — the police sergeants and lieutenants — and has requested that a state negotiator assist with those negotiations," Rapundalo said.

The collective bargaining agreement with AFSCME, the city's largest labor union, runs through June 30, 2011. The city has requested to begin bargaining with the group but has not yet received a reply from AFSCME leaders, Rapundalo said.

Rapundalo, whose frustration over lack of progress in labor negotiations has grown increasingly apparent in recent months, gave credit to the city's two deputy police chiefs — represented under Teamsters Local 214 — for agreeing to concessions last July, along with the Teamsters Civilian Supervisors and Teamsters Police Professional Assistants.

Though those units represent only a handful of the city's 500-plus union employees, the concessions are saving the city thousands of dollars and include new healthcare plans, increases in employee pension contributions and wage freezes. The city's non-union employees have made similar concessions, though they didn't have a choice.

Rapundalo cited several examples Tuesday night of other communities in Michigan where employees have stepped up to the plate to help cut costs.

  • In Royal Oak, the members of the Professional and Technical Employees Association agreed last summer to begin paying a 10 percent premium for healthcare and increased their contributions to the pension fund.
  • In Warren, the AFSCME bargaining unit agreed to a contract in October with a freeze in wages and a new health care plan with higher deductibles and increased co-pays.
  • In Mount Clemens, department heads have taken a 5 percent salary cut.
  • In Shelby Township, firefighters agreed to a contract with no pay increases through 2013 and changes to their health care plans.
  • Canton leaders plan to close the township hall for 12 unpaid furlough days this year.
  • In Macomb County, the clerk, treasurer and board of commissioners offices were closed throughout the Christmas and New Year's holidays using unpaid furlough days.
  • In Novi, the police command union agreed to wage and benefit cuts equal to $4,000 per person, and firefighters agreed to work 12-hour shifts as a way to save money.
  • Saline's two police unions, members of Teamsters Local 214 and non-union employees agreed to concessions that will save the city about $190,000 in health care costs in 2011.

Mayor John Hieftje said the city has struggled to make headway — particularly in negotiations with its police and fire unions because of Public Act 312, a state law that requires binding arbitration to resolve disputes between public safety unions and local municipalities.

"Certainly, I know across the state that Act 312 has been getting in the way. You can talk to any mayor in this state and they'll tell you that Act 312 needs to change," said Hieftje, who has been pushing for legislative reforms to the law. "We are negotiating in good faith and we are following all of the rules and procedures, but the playing field is not level."

Hieftje said the budget situation for Michigan cities is only becoming more grim as state lawmakers search for ways to address a state budget deficit of at least $1.8 billion.

If the Legislature is going to make further cuts to state revenue sharing, Hieftje said he hopes lawmakers at least pass reforms to Act 312 to allow cities like Ann Arbor to "find some equity" and bring benefit packages for police and fire unions in line with other labor groups.

An investigation last year showed that the average Ann Arbor city employee paid only 6 percent of the $981 monthly cost of his or her health benefits in 2009. Across the marketplace, the average monthly cost was $532, and employees typically picked up 41 percent of that amount, according to records obtained by

A closer analysis suggests Ann Arbor paid $5.8 million more for health insurance in 2009 than it would have if its benefit plans were in line with the rest of the marketplace.

Ryan J. Stanton covers government and politics for Reach him at or 734-623-2529.



Thu, Jan 20, 2011 : 7:30 p.m.

So many people forget the issue here. City government spending like money is free. Too many pet projects and special interests. Let's say they make employees pay 100% of healthcare. What do you think will happen to that money that the city won't pay on healthcare? Do you really think they'll be any 'wiser'? Let's spend another millon dollars to 'dumb down' the accounting system the city uses. (Good system BTW, since my paycheck is almost ALWAYS wrong). Let's spend more money on the city hall for expenses that were 'unforeseen'. I.e. Network switches (anyone in the IT field knows that this is a BASIC component of networks. They don't get over looked.) It's like over looking the wiring for your new house. Buy some more millon dollar art! How about the security system that was 'forgotten' about for city hall. Fix the real problem in this city before going after fabricated problems.

Michael Christie

Thu, Jan 20, 2011 : 1:33 a.m.

"as a city employee I currently pay nothing for insurance." What has this city been doing over the last 3 years? How can anyone expect to keep benefits like this, even the UAW unions at the automotive companies have don't have these "golden" benefits. The people responsible for asking as well as granting these types of benefits should be embarrassed and removed from the system. Get rid of the unions! Unions only bread mediorce employee's and reduce productivity. The people that join any union are scared of performing to their ability and standards set by organizations. Keep hiding behind your "representation" and this city will only get worse.


Wed, Jan 19, 2011 : 9:42 p.m.

Just to clarify. I am speaking of fire department service specifically. Although aapd may help with u of m situations, the school has its own pd, and therfore actually foot the bill of their usage. If, as some people have hypothesized, rather then pay the city the U were to make its own fd, the u fd and the aafd would work together, as the pd's do. Basically this would allow the city to cut fd jobs, that would probably equal the amount of fd jobs created by a new u of m fd. The result would be a shifting of u of m's fair share of the fire department fiscal burden to them. Presumably, there would be no drop in safety or the amount of firefighters in this area. Why pressure is not applied in order to gain these monies, and the fact that the mayor (or anyone else for that matter) never talks about this is truly beyond me. I am not saying this is perfect or right, but as a city taxpayer, I want to know WHY. If the answer is we do not want to upset the u of m, then I am not pleased and I think a change would have to be made in our current administration. The truth is if u of m was pressured to pay they would have a few options; pay the monies, have no fire protection, or move their facilities out of ann arbor to a community that will provide it a free fire service (i say good luck to the last one) I still agree we do need an overhaul of most of the city policies, but I cannot stand for this rhetoric by the administration telling people they have to make sacrifices, while it refuses to try to extract money from an entity with a $7,000,000,000 bank account (yes that's billion)


Wed, Jan 19, 2011 : 9:25 p.m.

A way to fix the budget would be to extract the money U of M has not given Ann Arbor for fire dept service. Although they are not obliged (this is somewhat of a state/political issue.) However there probably is standing for a lawsuit... )I think the request should be made continually, and Ann Arbor should make it known that U of M will not be covered by their fire department. It is unfair for a local population to let a gigantic state entity free ride on this service. It may seem a bit dramatic, harsh, and even a little bit of high stakes poker, but u of m should be given a choice to pay money (their share based on a % of land owned) for the aafd service over the past few years and from this time forward or face the fact that aafd will not respond to their properties. If a U building catches fire, let it burn, but protect the interests of those non U buildings surrounding it. Some will argue this is cruel and "what if its the hospital?" but for a university endowed with over $7,000,000,000 (I haven't checked this number lately) paying for its share of the fire bill is a tiny expense. Additionally if the city were to receive this money, especially the payment of past expenses, we would be able to fill some, if not all, of the budget gap with it Simply put, instead of forcing the fire department to make cuts, Ann Arbor should go get the money that is owed to it.

Tony Livingston

Wed, Jan 19, 2011 : 8:45 p.m.

Pragmatic is telling it like it is. Notice there is no mention of union or nonunion. That is because they are all getting these huge perks at the expense of Ann Arbor property owners. Something else they won't mention is the large number of city employees who live outside the city. They drive in to work and get all those great benefits but pay no city taxes at all. The taxes in Scio Township are 15 mils lower than Ann Arbor. The roads are crappy, there are no parks, and the green belts are financed by Ann Arbor taxpayers. Enjoying the perks that Ann Arbor tax payers provide is just a short drive/bike ride away and free to all.


Wed, Jan 19, 2011 : 7:51 p.m.

A key problem I have been seeing is that Ann Arbor municipal employees are grossly overpaid. This is an across the board problem starting with the City Attorney and his staff, the police and fire personnel as well as the managerial employees at City Hall. Why should police officers earn more than the Mayor? Why should we have the highest paid City Attorney in the state? Why do our chief financial officers and administrators make well into six figures? These exorbitant salaries need to be cut down to size.


Wed, Jan 19, 2011 : 8:17 p.m.

This is a strong city manager government. The mayor and council are part time employees.


Wed, Jan 19, 2011 : 7:01 p.m.

People's opions are typically based on what side of the public trough they are on. There are exceptions (see Pragmatic's post where he takes a very reasonable. I don't want a tax hike, that being said there must be a reduction in city expenditures (which are mainly salaries and benefits). If people believe this is unfair they can seek other employment.

Alan Goldsmith

Wed, Jan 19, 2011 : 6:34 p.m.

"In response to comments suggesting this story is one-sided, it should be known that the leaders of the police and firefighters unions have declined to comment publicly on labor negotiations since last year. I would love to include their voices in stories like this. They have chosen not to have their voices heard." 1. This should have been included in the original story. 2. "They have chosen not to have their voices heard" is a judgment call. It sounds more like they've chosen not to speak with YOU. Did you call anyone specifically for this story or just assuming since they've declined previously they would decline any future requests? If so, which specific Union Leader(s)? 3. Why do you think Union Leaders don't feel like they want to speak with this media outlet? Has anyone asked that question internally?


Wed, Jan 19, 2011 : 6:31 p.m.

As a City employee I am very grateful to Ann Arbor taxpayers for the good pay and generous benefits I receive. I am more than willing to make the necessary sacrifices during these tough economic times. We employees can save the city millions by bringing our health care benefits more in line with the private sector. I currently pay nothing for my health care insurance which costs the taxpayers over $10,000 per year. I'd be willing to pay higher deductibles and share in the costs of the premium. We are also allowed to retire at 50 years old (a young age), which places a several decade burden on the city for our pension and health care costs until we die. Again, this retirement age should be increased a few years to reflect what the private sector does.

Tony Livingston

Wed, Jan 19, 2011 : 8:38 p.m.

The retirement age should be inline with others. Social Security starts at age 62. Employees could continue to be vested at age 50 but should not be allowed to start collecting until at least age 62 if not higher. This is a huge scam and it makes me furious. What the administrators will not tell you is that THEY receive this benefit also. It is not just a union issue.


Wed, Jan 19, 2011 : 8:27 p.m.

In 1973 the retirement age was 55 yoa 30yrs service to get a full pension. For most employees it ment working 34 years to get to age 55. Over the years the city NOT the unions have reduced both, not at the request of the unions either. The city wanted to reduce the staff and lower the senority of it's staff. The retirement windows, especially the one in 2001 was initiated by the city. They came to the unions unsolicited with the buy out offer. Government jobs are more secure and receive more benifits these days, however over the years if you wanted a higher paying equalivent job you went to the private sector. In many cases today that still holds true. Private senior attorney vs City Attorney, Private doctor vs army doctor, Corporate President vs President of the United States..get the point!


Wed, Jan 19, 2011 : 6:16 p.m.

This seriously one-sided report reads mainly as a propaganda broadside for the city administration. As indicated in some of the comments above, some significantly meaninful, game-changing information has been left out. Beyond the lack of information from other relevant parties, statements attributed to Rapundalo and the mayor appear less than fully accurate. Yet these distortions remain uninvestigated and unchallenged. There's media spin by council going on, and here that's swallowed whole without question. Then again, a piece like this, slanted to a point where reading it makes one less informed than before, excites the hard-right commenters and infuriates the more fair-minded readers, thus generating replies and more page hits.... In part, this episode is an example of class warfare, in which our Democratic council people cleverly follow the lead of a state legislature dominated by tea drinkers and the far-right Mackinac Center. They'll exploit upcoming wingnut activity in Lansing as cover to go on the warpath against unionized city employees — who apparently have been designated as the ones whose substantial concessions will ultimately pay off the huge bond debt for the new city hall building and the library lot's underground parking structure. In their dealings with the unions, city council counts on the resolute apathy of Tree Town's white-collar liberals, who tend to have only a fuzzy, limited grasp of issues affecting blue collar and union workers. It will be up to the unions to organize a public education campaign to fully inform the locals. At some point, they will need to move beyond their apparent public silence. And Public Act 312 exists for good reason. Please read up on its history.

Janelle Baranowski

Wed, Jan 19, 2011 : 6:04 p.m.

With the cost of benefits being nearly 50% higher than the public sector, the benefit plans should be reviewed first before increasing employees' cost-sharing. People don't want to see their paychecks shrink; I can understand that. Bringing employees' health plan more in line with the public sector (higher co-pays, deductibles, etc.) would provide significant savings.

Ryan J. Stanton

Wed, Jan 19, 2011 : 5:54 p.m.

In response to comments suggesting this story is one-sided, it should be known that the leaders of the police and firefighters unions have declined to comment publicly on labor negotiations since last year. I would love to include their voices in stories like this. They have chosen not to have their voices heard.


Wed, Jan 19, 2011 : 2:58 p.m.

Just to clarify a statement regarding the retirement age. It was the City of Ann Arbor that over the years has lowered the retirement age/years of service to where it is today. They did it in incriments over several contracts. It was done to encourage the senior, higher paid employees to retire. Never did the unions/non union employees ask to have the age/years of service lowered. Even with this article, as with every other one in past years has the City of Ann Arbor made the claim they do not have the ability to pay, they just choose not to. If they made that claim in binding arbitration they would have to open the city books, and they do NOT want to do that!

Jay McNally

Wed, Jan 19, 2011 : 2:55 p.m.

The citizenry would be well served by a coherent list of benefits A2 public employees receive, especially in retirement. How 'bout a list of retired employees, their annual pay and value of benefits? Those outisde the loop might be shocked to see what the retirees make, and maybe even shocked to see how much money the unions contribute to the political campaigns of those doing the contract negotiations.

Tony Livingston

Wed, Jan 19, 2011 : 8:34 p.m.

I agree. I would love to have this information made public. Along with what they make, we should also see what their age is and what age they started receiving the retirement benefits. Retirement pay is meant for people too old to work. Not for people in their prime years.


Wed, Jan 19, 2011 : 2:58 p.m.

How much is that number A2Guy? I know the FD spent $0 for the compaigns. So what groups and how much? Site your facts.

Edward Vielmetti

Wed, Jan 19, 2011 : 2:29 p.m.

Here's a bit of background on Act 312, from Arborwiki: <a href="" rel='nofollow'></a> Michigan's compulsory arbitration law, Public Act 312 of 1969, requires police, firefighters and public employers to forego traditional actions such as strikes, walk-outs and lockouts. A panel of arbitrators determine binding decisions on contract disputes. -- This act was put into place in part because of unauthorized police strikes, known as the &quot;blue flu&quot;; I'm reading newspaper accounts from 1967 of over 1000 Detroit police who went off the job calling in sick as part of a negotiating tactic to improve pay.


Wed, Jan 19, 2011 : 2:23 p.m.

Sorry to sound like a broken record. The city govt. exists to provide services not to employ people. The city is short on money, the taxpayers no longer want to subsidize the city unions.


Wed, Jan 19, 2011 : 9:37 p.m.

As a taxpayer, there are many things I don't want to subsidize either, such as unnecessary wars, but we don't get to pick and choose.


Wed, Jan 19, 2011 : 5:40 p.m.

Broken record or not, everyone seems to need to be reminded of this. Keep up the good work!


Wed, Jan 19, 2011 : 2:01 p.m.

I thought Alan was a union leader Democrat, I got that one wrong , thanks Alan for putting another nail in the coffin. As I often say, DBP! Unions, if a firefighter is a skilled job then it is OJT, people are waiting to cut off their ARM for that job.

Stephen Landes

Wed, Jan 19, 2011 : 1:59 p.m.

I don't think it makes sense for a sitting city council member to be leading or even participating in negotiations with city employee unions. We have a city manager who is supposed to be running city business. He should be charged with negotiating with his employees. City council should be able to stand back from the process and have the final say -- up or down -- on the contract form the city/citizens' point of view.

Cindy Heflin

Wed, Jan 19, 2011 : 1:57 p.m.

A comment that violates our conversation guidelines was removed. A reply to the comment was also removed.

Chase Ingersoll

Wed, Jan 19, 2011 : 1:57 p.m.

Ryan: this is the last sentence in the article, but possibly the most important. &quot;...A closer analysis suggests Ann Arbor paid $5.8 million more for health insurance in 2009 than it would have if its benefit plans were in line with the rest of the marketplace....&quot; I don't understand if this 5.8 million is the greater cost of the overall package or the portion of the amount that City of Ann Arbor picked up. Can someone follow up and verify this, specifically the origin of the numbers that &quot;suggest&quot; this and if correct, an explanation as to the difference that Ann Arbor is receiving for the higher costs. People are going to suggest graft/malfeasance based upon the magnitude of the number, so I think it would be important to closely examine that number.

Lifelong A2

Wed, Jan 19, 2011 : 1:52 p.m.

@Alan Goldsmith- Perhaps you're not aware how government works. Councilmembers (and the Mayor) don't negotiate with the unions; City staff handle the negotiations. And before you attack City staff, I suggest you re-read the article: the City *has* succeeded in getting new agreements with the non-312 unions. But negotiations are meaningless for the 312 unions because the law encourages those unions to stall, stall, stall. I urge you to stop pursuing a political agenda, and to start making productive suggestions.


Wed, Jan 19, 2011 : 1:46 p.m.

Most importantly, move the retirement age to 62 for ALL city employees. There is no reason that anyone should be collecting a pension in their early 50s. If they want to leave for another job, fine. But they should not be able to collect their retirement pensions until age 62. The present retirement policy is bankrupting the city and it involves both union and nonunion. The people you read about leaving their jobs at the city are not quitting. They are RETIRING, collecting pension and benefits, and taking another full time job.


Wed, Jan 19, 2011 : 1:51 p.m.

If an employee starts working for any company at oh say 21 years of age, puts in 30 years of service they should not collect their benefits at 51?

Pete Warburton

Wed, Jan 19, 2011 : 1:36 p.m.

Mayor Hieftje and his administration have done very few things &quot;in good faith'&quot; when dealing with city workers. I feel no need to back this statement with facts. backs very few of its statements(opinions) with facts .


Wed, Jan 19, 2011 : 1:35 p.m.

The statistics are amazing. Employees in the private sector pay 41% of their $532 monthly healthcare costs. Public employees pay 6% of the $981 monthly cost, hence the term &quot;Cadillac&quot; benefits. Their costs are almost double the private sector and they pay on average $59 dollars per month while private sector employees pay $213 per month for far inferior health benefits with higher copays and dedcutibles. It is quite amazing when Democratic leaders are asking the state to amend Act 312 and find themselves at odds with the unions holding them hostage. This is going to be interesting and enlightening to watch. It looks like the tide is finally beginning to turn in the interest of the taxpayers.


Wed, Jan 19, 2011 : 9:35 p.m.

The whole public worker privilege thing has recently been debunked. You can't lump all public employees together, and then pull out individual stats to apply to all. As a public employee, I can guarantee you that I pay more than 6% of $981 monthly for health care.


Wed, Jan 19, 2011 : 12:48 p.m.

@AlphaAlpha: I'd be interested to know the facts behind your conclusion that, &quot;Too many public employees earn upper class wages for middle class jobs&quot;.


Wed, Jan 19, 2011 : 11:51 a.m.

Rapundalo forgot to mention that the Ann Arbor FFs took a 4 percent pay reduction. That they were the only union in the city to give any concessions and then were the only union in the city to have members laid off. And those members are still laid off.

Alan Goldsmith

Wed, Jan 19, 2011 : 11:48 a.m. 'investigation? Lol. Did you 'investigate when other cities shifted to defined contribution retirement plans while A2 didn't? Did you 'investigate' who was on negotiating teams the last decade who failed to shift the City in that direction? Or who was the Mayor? Did you even bother to call any of the city employee groups for this story or are then not on your iPhone contact list? Kudos for the 'investigation' of all this publicly available data. But it's time to ask tough questions of everyone involved and not jump on the talking point band wagon of bashing public employees without taking the time to go any deeper about the other reasons for this failure to plan ahead.

Alan Goldsmith

Wed, Jan 19, 2011 : 11:43 a.m.

Sounds like City Council Member Stephen Rapundalo has been a total failure as a negotiator, and that The Mayor can list all the other cities and their successes but can't pull it off himself. It's no wonder he's expecting to be bailed out now by the Republicans in power in Lansing. For starters, ex-Repub Rapundalo should step down since he doesn't seem capable of inspiring trust during the negotiation process. Secondly, we are now paying the price, literally, of Mr. Mayor's failures during his last decade in the position. While other cities were negotiating health care cost sharing and shifting to defined contribution retirement plans, our Mayor had other things he wanted to focus on. Bikes and trains and paying off friends with millions of dollars in no bid contracts. It's no wonder, looking back, how we got to this point. But off course, it's not the Mayor's fault. And, we, the Ann Arbor taxpayer, will have to pay for his, and Council's failures.


Wed, Jan 19, 2011 : 12:43 p.m.

I second that. It seems to me that these contracts have been EXPIRED for a year and a half and therefore, presumably, negotiations have been going on for two years or more. Just now the City thinks a mediator might be needed?


Wed, Jan 19, 2011 : 11:36 a.m.

Major public employee concessions are in order. Too many public employees earn upper class wages for middle class jobs.