With yet another courtroom showdown looming between firefighters and Mayor Mitch Landrieu’s administration in a lawsuit over decades of back pay, city officials have outlined a new plan that would cover the full $75 million owed over 30 years, though it would require firefighters to give up claims to tens of millions of dollars in interest and to make concessions on their pension system.
Although the offer is much more generous than the city’s previous proposal, firefighter union officials said including a waiver of those additional debts — which total more than $100 million — and the long payout schedule make the proposal unacceptable.
As a result, when the two sides square off Friday in Civil District Judge Kern Reese’s courtroom, the firefighters could ask the judge to order the city to pay the full amount or else hold top city officials in contempt of court.
Reese is presiding over the case, which is known as the “longevity lawsuit” and started in the late 1970s. He has indicated he is losing patience and wants the matter resolved, warning city officials last month that they had just weeks to come up with a way to pay the firefighters.
At the request of both administration officials and firefighters, Reese two weeks ago put off the day of reckoning until Friday.
It’s unclear whether the city’s latest proposal will satisfy Reese, though it comes significantly closer to what firefighters have been seeking than previous city proposals, including the most recent offer of about $45 million over 13 years.
The new proposal would pay firefighters $15 million up-front — close to the $20 million the firefighters had been seeking earlier in the negotiations, Chief Administrative Officer Andy Kopplin said. Another $5 million would be paid if voters next year approve a tax to help pay off the judgments, and the rest would be paid out in $1.8 million increments over 30 years.
If the tax is not approved, the city would start to pay the balance in 2031, when bonds that were supposed to put the firefighters’ pension system onto solid footing but were instead squandered are finally paid off, freeing up money for the judgment.
“All the proposals have always talked about a stream of revenue over a number of years,” Kopplin said.
In either case, the upfront money would come in part from up to $8 million being held in a reserve account for firefighters who were part of an older pension system. Those firefighters’ retirements are being paid for on a pay-as-you-go basis by the city, rather than through a pension system that collects and invests money from workers over the years and uses it to pay retired members.
The city has consistently said that an agreement in the longevity case has to be tied to a settlement in another suit concerning $26 million the city failed to pay into the firefighters’ pension fund early in Landrieu’s tenure.
The city also has said an agreement should be tied to broader changes in the way the pension system is structured, including changes in the way benefits are calculated and raising the retirement age for new hires. Those provisions also are included in the current proposal.
“If accepted, this (proposal) solves two big problems we’ve been struggling with — the longevity lawsuit and a broken pension system — in a responsible and sustainable way,” Kopplin said.
Louis Robein, an attorney for the firefighters, dismissed the plan Thursday as a “so-called offer,” saying it would shortchange firefighters.
It does not include roughly $67 million in interest that has accumulated on the $75 million judgment over the years or $55 million in other contributions firefighters say are owed to the pension system, Robein noted. In addition, he said, it would be legally and ethically problematic to tie the back pay and pension cases together.
Firefighters union President Nick Felton would not comment on the deal, saying he was “shocked that Mr. Kopplin has violated” what he said was the confidentiality of the two sides’ negotiations.
The court fight comes as Felton also is claiming the administration is putting firefighters in danger with a new policy that some city firetrucks will now carry only three firefighters, instead of the four recommended by national firefighter organizations. Four firefighters per truck are needed so two can jointly go inside a burning building to rescue anyone in danger while two others wait outside as backup, Felton said.
The policy on three-man trucks essentially just codifies something that has been occurring anyway due to staffing shortages. The department is down 30 employees, something officials blame on the fact the city has not offered a civil service test for new firefighters since 2011.
City officials say the three-man trucks do not pose a risk for firefighters.
The firefighters on Friday may be pushing to see if Reese will be willing to hold officials in contempt or seize city assets.
Robein said he will ask Reese to enforce the court’s judgment on Friday. Asked what that could mean, he pointed to the case of a Kentucky federal judge who on Thursday held a county clerk of court in contempt and jailed her for refusing to issue licenses for same-sex marriages.
Reese “has several options, just like the judge in Kentucky had several options,” Robein said.
Follow Jeff Adelson on Twitter, @jadelson.