Mayor Mitch Landrieu issued an ultimatum to firefighters as he unveiled his 2016 budget Thursday: agree to a settlement with the city in a pair of lawsuits worth hundreds of millions of dollars by the end of the day or lose the chance to negotiate.
“If we do not get to a result today I’m going to turn my attention to other matters and leave this issue to the courts,” Landrieu said. The unrelated suits against the city involve a dispute over back pay that dates back decades as well as a Landrieu administration decision not to fund the firefighters pension fund until it fixed issues that nearly bankrupted it. The administration has tied those two issues together, saying it will not agree to a deal to pay the $142 million in back pay and interest in the first suit until firefighters agree to make changes to their pension system.
Representatives of the firefighters union and the administration have been in mediation for months trying to reach an agreement. While most of those negotiations have occurred behind closed doors, two settlement proposals offered by the city were made public, and both were rejected by the firefighters as either being too stingy or stretching out payments for up to 30 years.
The mayor had been holding out hopes that a settlement could be reached in time to include it in the city’s budget as late as Wednesday, but no deal materialized.
Firefighters union head Nick Felton said after Landrieu’s briefing that there “has been some positive movement in the last 24 hours” and there was a possibility a deal could be brokered. But, he said, that the ball is in Landrieu’s court.
“That’s up to him, we’ve been dealing in good faith for some time,” Felton said. “He can leave it up to the courts if he wants, but that may end up with him in jail.”
The administration says the lawsuits and the payments it is required to make to the pension fund each year will total about $400 million over the next 10 years. That includes increased payments needed to properly fund a pension system beleaguered by poor investment decisions. Providing that funding will cost the city $20 million more next year than it paid this year, which will eat up a large chunk of the $56 million in new revenue projected to flow into city coffers.
Follow Jeff Adelson on Twitter, @jadelson.