Gaining The Edge In Union Negiotiations

Finally, the town of Waterford might be able to get what it wants in its union contracts.

The board of finance, with the help of some new accounting policy, voted Wednesday to unanimously change its fund balance policy. The move needs to be approved by the Representative Town Meeting before it becomes official.

“It is very difficult for this town to set its position as far as (union) negotiations go,” Finance Director Rudie Beers said. “This should address that.”

The Background

First Selectman Dan Steward, the town’s chief negotiator, said the town’s large general fund has prevented him from pushing union contracts to arbitration. Union salaries are based off of the town’s ability to pay, and with such a high general fund, the town’s ability to pay is deemed high, so the unions would win, Steward said.

Recently, the town approved contracts with the and town-side administrators union with salary raises of at least 2 percent every year. In both, Steward said it was the best the town could do, and would not win in arbitration.

This summer, the board of education will begin negotiations with five of its six unions, including the teachers union, the largest union in town. The town government is negotiating one contract as well.

The town has $9.6 million in its general fund, or around 13 percent of its total budget. That is a high number (other towns have around 5 to 8 percent in their general fund) because the school is bonding over $100 million for school construction, and that large general fund keeps the interest rate very low, Beers said.

The problem is it also makes negotiations difficult, she said.

Wednesday’s Move

On Wednesday, the board of finance approved a new board policy titled GASB 54. This allows the board of finance to designate money within the general fund in separate subcategories: non-spendable, restricted, committed, assigned and unassigned.

Because the town keeps a large amount of money in the general fund to keep the bond rating low, it can now set aside that money as “committed.” This will show the money isn’t “unassigned,” loosely translated as that the town has a bunch of money laying around, Beers said.

“(The general fund) is not discretionary funds,” Beers said. “This is money that is a requirement… to sustain a bond rating.”

Board of finance members were happy with the new laws.

“This is great,” board chairman Ron Fedor said.

“I think this is essential to the town,” board member Alan Wilenksy said. “I think this is wonderful.”

What Now

The town needs this new policy in place by the start of the next fiscal year, July 1, for this to affect summer contract negotiations.

Beers said it is critical this new policy is passed in that time, as not passing it would again ruin the town’s ability to negotiate.

“I think you want to do that with the contracts coming up for renewal,” Beers said.

The RTM needs to approve the new policy in the next two weeks. The board of finance and Steward both agreed they would ask RTM moderator Sharon Palmer for a meeting within that time period.