Members of New Orleans’ firefighters union have overwhelmingly approved a deal with Mayor Mitch Landrieu’s administration settling both a decades-old dispute over $75 million in back pay and years of underpayments by the city to their pension fund.
The union members voted 360 to 115 in favor of the settlement, clearing the last major hurdle to finalizing the deal, though Civil District Court Judge Kern Reese still must approve it.
Although a frustrated Reese sought to put Landrieu under weekend house arrest last month when an agreement still seemed like a far-off possibility, the vote by the firefighters union makes it likely he’ll sign off on the plan, which was first announced Oct. 16.
Firefighters considered the deal over two nights before approving it Thursday, according to the union, though the decision was not without some dissension.
“While most members were disappointed with aspects of the agreement, including the fact that firefighters accepted less than half of the money legally owed to them, the membership collectively agreed that accepting the settlement was in our best interest,” union President Nick Felton said in a news release.
“We would like to once again thank the public for their patience and longtime support,” Felton said. “After having waited more than three decades for their earned back pay, it is a relief to firefighters to have closure on this issue.”
Under the deal, firefighters will receive the $75 million they are owed in back pay in a case, dating back to 1979, that began after the city did not grant them state-required raises.
That money will be paid in upfront payments of $15 million this year and $5 million next year, with the balance being paid over more than a dozen years if voters next year approve a property tax of 2.5 mills to help fund both the settlement and firefighters’ retirements. If that tax fails, an alternative plan will be put in place to pay the rest of the money.
As part of the settlement, the firefighters will forgo $67 million they had been seeking in interest on the back pay, as well as tens of millions more they said they were owed in contributions to the pension system that would have been due had their wages been at the higher level mandated by the state.
In addition, they agreed to settle an unrelated case over the Landrieu administration’s refusal to pay the full amount owed into the beleaguered pension system during the mayor’s years in office, and they agreed to concessions on how the retirement system is run and what benefits new employees will receive.
Under that deal, the city will make up for the missing payments through its contributions to the system in the future.
The Landrieu administration projected the pension system changes will save the city about $275 million over 30 years.
Follow Jeff Adelson on Twitter, @jadelson.