Legislature(1999 - 2000)

02/25/1999 08:03 AM House CRA

Audio Topic
* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
txt
HB 1 - MUNICIPAL COLLECTIVE BARGAINING CONTRACTS                                                                                
                                                                                                                                
Number 2523                                                                                                                     
                                                                                                                                
CO-CHAIRMAN HARRIS announced that the next order of business before                                                             
the committee would be HOUSE BILL NO. 1, "An Act relating to                                                                    
collective bargaining agreements and arbitration awards of class                                                                
(a)(1) municipal employees."                                                                                                    
                                                                                                                                
REPRESENTATIVE BRICE, Sponsor of HB 1, stated that HB 1 puts                                                                    
meaning back into collective bargaining.  During negotiations                                                                   
employees generally have the following two tools:  the right to                                                                 
strike and binding arbitration.  Within the Public Employees                                                                    
Relation Act, Class(a)(1) employees such as firemen, policemen, and                                                             
hospital staff do not have the right to strike.  Since Class(a)(1)                                                              
employees do not have the right to strike to ensure finality within                                                             
the negotiating process their negotiated contracts are submitted to                                                             
binding arbitration.                                                                                                            
                                                                                                                                
The situation can become problematic if during the negotiation                                                                  
process, the employers and the employees agree on a contract which                                                              
is subsequently disapproved by a city council.  The employee                                                                    
organization has no means by which to compel good faith bargaining                                                              
in the future.  Problems also arise when the employee and employer                                                              
have the negotiations submitted to binding arbitration and the                                                                  
arbitrator's decision is not funded by the council or assembly.                                                                 
Once again the firemen and policemen are left in limbo with no                                                                  
venue to compel good faith negotiation in the future.  This                                                                     
legislation, HB 1, would reestablish the "binding" in binding                                                                   
arbitration.                                                                                                                    
                                                                                                                                
Number 2680                                                                                                                     
                                                                                                                                
CO-CHAIRMAN HALCRO expressed concern with the broadness of                                                                      
Class(a)(1) employees, specifically regarding hospital employees.                                                               
                                                                                                                                
REPRESENTATIVE BRICE asked if the employees of a hospital where                                                                 
life-dependent functions occur should be allowed to strike.  The                                                                
public policy has been not to allow hospital employees to strike.                                                               
If hospital employees want to be included under the Public                                                                      
Employees Relations Act (PERA) those employees must negotiate under                                                             
binding arbitration as well.  Representative Brice pointed out that                                                             
hospital employees do provide life-saving services.                                                                             
                                                                                                                                
REPRESENTATIVE KOOKESH asked if there had been a group of employees                                                             
that did not have a venue for redress.                                                                                          
                                                                                                                                
REPRESENTATIVE BRICE replied yes.  The Fairbanks Police Department                                                              
had a contract go to binding arbitration.  The decision was made to                                                             
fund the incremental increases to pay as well as food and clothing                                                              
allowance requirements which were not funded.  When the case was                                                                
submitted to superior court, the court ruled that the council did                                                               
not have to honor the binding arbitration.                                                                                      
                                                                                                                                
REPRESENTATIVE KOOKESH inquired as to the general rule in the                                                                   
United States regarding Class(a)(1) employees.                                                                                  
                                                                                                                                
REPRESENTATIVE BRICE said that he could provide that information.                                                               
In response to Representative Murkowski's question, Representative                                                              
Brice said that since no effective date is specified the                                                                        
legislation would become effective 90 days after signature.                                                                     
                                                                                                                                
Number 2953                                                                                                                     
                                                                                                                                
KEVIN RITCHIE, Alaska Municipal League, apologized to                                                                           
Representative Brice since the Alaska Municipal League had not                                                                  
completed discussion of HB 1.  The Alaska Municipal League                                                                      
discusses public policy issues with its legislative committee which                                                             
on this issue resulted in many questions.  Mr. Ritchie noted the                                                                
complexity of binding arbitration and labor law as well as the                                                                  
delicate balance between binding arbitration and a local                                                                        
council/assembly with the ability to set a tax rate without                                                                     
mandated issues.  He identified the later as perhaps what HB 1                                                                  
addresses.                                                                                                                      
                                                                                                                                
TAPE 99-9, SIDE B                                                                                                               
Number 2983                                                                                                                     
                                                                                                                                
MR. RITCHIE pointed out that when two parties reach the final offer                                                             
through a collective bargaining process, the offers could be close                                                              
or very far apart.  When the decision goes to an arbitrator, the                                                                
arbitrator chooses something in between the two final offers.                                                                   
Currently, councils and assemblies have the ability to appropriate                                                              
or not appropriate because what is best for a community must be                                                                 
determined.  Mr. Ritchie read the Alaska Municipal League's                                                                     
position on binding arbitration which follows:                                                                                  
                                                                                                                                
     The League opposes imposing binding arbitration on local                                                                   
     governments and school districts.  Binding arbitration hinders                                                             
     local elected officials' ability to determine their personnel                                                              
     costs and prevents local governments from having complete                                                                  
     control of determining the local tax rate.  The scope of                                                                   
     decisions with regard to what local government can afford, is                                                              
     best left to the local bodies possessing that knowledge.                                                                   
                                                                                                                                
Mr. Ritchie stated that he would continue work on this issue as                                                                 
well as talk with the sponsor on this issue.                                                                                    
                                                                                                                                
CO-CHAIRMAN HALCRO noted that HB 1 has been on file for quite some                                                              
time.  He was surprised that there was not one letter of opposition                                                             
from any local governments.  Is this not an issue for the local                                                                 
governments?                                                                                                                    
                                                                                                                                
MR. RITCHIE acknowledged that there have not been a lot of bills                                                                
this year, but the League has not completed discussion on all of                                                                
the bills.  This issue was not brought to the League during the                                                                 
interim as it could have been.  Currently, Mr. Ritchie estimated                                                                
that the League is tracking 20 or 30 bills.                                                                                     
                                                                                                                                
Number 2852                                                                                                                     
                                                                                                                                
CO-CHAIRMAN HARRIS said that he could see both sides of this issue,                                                             
especially having experience with local government and being a                                                                  
member of a labor union.  Where are essential emergency personnel                                                               
left if they do not have the right to strike and cities are not                                                                 
bound by the terms of any agreement with those employees?                                                                       
Co-Chairman Harris indicated that these employees seem to be left                                                               
in limbo in many cases.                                                                                                         
                                                                                                                                
MR. RITCHIE said that in most cases contracts are an agreement                                                                  
between two parties, but that is not so with binding arbitration.                                                               
Mr. Ritchie also saw both sides of the issue.  There may be a                                                                   
better solution.  Mr. Ritchie emphasized that this is a very                                                                    
complex area that would require much analysis and discussion which                                                              
has not yet been returned from the municipal attorneys and                                                                      
councils.                                                                                                                       
                                                                                                                                
CO-CHAIRMAN HARRIS stated that he would not be reporting HB 1 from                                                              
committee today in order to receive more information from various                                                               
groups.                                                                                                                         
                                                                                                                                
REPRESENTATIVE DYSON concurred.  Representative Dyson was surprised                                                             
that HB 1 did not result in comments from many local governments.                                                               
What would be a reasonable time frame to receive responses from                                                                 
local governments?                                                                                                              
                                                                                                                                
MR. RITCHIE estimated that two weeks would be a reasonable time                                                                 
frame.                                                                                                                          
                                                                                                                                
Number 2715                                                                                                                     
                                                                                                                                
DON ETHERIDGE, District Council of Laborers, supported HB 1.                                                                    
Binding arbitration is designed to reach an agreement, to determine                                                             
the balance of the various sides.  This legislation would make                                                                  
municipalities work harder to reach an agreement that everyone                                                                  
could live by.  With regard to a previous question about                                                                        
Class(a)(1) employees, Mr. Etheridge informed the committee that                                                                
Alaska Labor Relations determines which public employees are                                                                    
classified as Class(a)(1).  Mr. Etheridge said that once an                                                                     
agreement is reached that agreement should be followed.                                                                         
                                                                                                                                
CO-CHAIRMAN HARRIS noted that school teachers do not fall under                                                                 
this classification.                                                                                                            
                                                                                                                                
MR. ETHERIDGE replied no.  In order to fall under this                                                                          
classification, the employee must work in the area of life or                                                                   
property protection.                                                                                                            
                                                                                                                                
CO-CHAIRMAN HARRIS cited AS 23.40.200 Classes of public employees;                                                              
arbitration subsection(b), "... If an impasse or deadlock is                                                                    
reached in collective bargaining between the public employer and                                                                
employees in this class, and mediation has been utilized without                                                                
resolving the deadlock, the parties shall submit to arbitration to                                                              
be carried out under ...."  He asked if that section refers to                                                                  
municipalities.                                                                                                                 
                                                                                                                                
MR. ETHERIDGE said that portion of statute would refer to                                                                       
municipalities that are under PERA.                                                                                             
                                                                                                                                
Number 2544                                                                                                                     
                                                                                                                                
MARK DRYGAS, Business Agent, Fairbanks Firefighters Association and                                                             
Captain, Fairbanks Fire Department, testified via teleconference                                                                
from Fairbanks.  Mr. Drygas supported HB 1.  The Fairbanks Fire                                                                 
Department has had an expired contract since 1995.  Negotiations                                                                
have been ongoing for over three years.  In the past, the Fairbanks                                                             
Council has not funded the arbitrators award.  The Fairbanks                                                                    
firefighters are at disadvantage and not playing on a level field.                                                              
Mr. Drygas explained that the firefighters are compelled by law to                                                              
utilize binding arbitration if an impasse is reached and they are                                                               
compelled to abide by binding arbitration.  If an arbitrator found                                                              
that the firefighters were overpaid or ruled that a change in the                                                               
contract be made which would negatively impact the employees, the                                                               
employees are bound by that ruling.  However if the arbitrator                                                                  
found that wage increases were necessary, the city would have the                                                               
opportunity not to fund that.  The Class(a)(1) employees are bound                                                              
by the negative impacts of the binding arbitration without the                                                                  
advantage of the positive impacts.  Mr. Drygas noted that the                                                                   
Fairbanks firefighters had not received a wage increase since 1990.                                                             
                                                                                                                                
MR. DRYGAS said this situation only recently occurred due to a                                                                  
court decision.  Under previous contract negotiations, the                                                                      
Fairbanks firefighters and the municipality felt that binding                                                                   
arbitration was an option during an impasse.  The Fairbanks                                                                     
firefighters have never gone to arbitration in the five or so                                                                   
contracts with the city.  In each instance, negotiations and                                                                    
agreements on a collective bargaining agreement have occurred.  Mr.                                                             
Drygas said that all contracts do not go to binding arbitration and                                                             
that is not the hope.  In the specific case of the firefighters in                                                              
Fairbanks, Mr. Drygas did not foresee any resolution to contract                                                                
negotiations without HB 1 or something similar.                                                                                 
                                                                                                                                
Number 2340                                                                                                                     
                                                                                                                                
REPRESENTATIVE JOULE asked if he understood Mr. Drygas correctly.                                                               
Representative Joule understood that if negotiations reach an                                                                   
impasse, the parties go to arbitration.  If there are negative                                                                  
impacts in the decision of the arbitrator, the employees must abide                                                             
by those recommendations while if the arbitrator's decision has                                                                 
negative impacts to the municipality, the municipality is not                                                                   
required to abide by that decision.                                                                                             
                                                                                                                                
MR. DRYGAS said Representative Joule's assessment was correct.  The                                                             
arbitrator's decisions are subject to legislative approval,                                                                     
therefore a spending increase.  The city basically can pick and                                                                 
choose what it wants to fund or agree to from the arbitrator's                                                                  
decision.  The employees, however are bound by the arbitrator's                                                                 
decision.                                                                                                                       
                                                                                                                                
CO-CHAIRMAN HALCRO inquired as to the number of times Mr. Drygas                                                                
had been to binding arbitration in the last 15 years.                                                                           
                                                                                                                                
MR. DRYGAS said that in the 25 years of contracts with the city,                                                                
the Fairbanks firefighters have never gone to binding arbitration.                                                              
Until the supreme court case, previous negotiations between the                                                                 
city and the Fairbanks Firefighters Association felt that binding                                                               
arbitration was binding.  Mr. Drygas wanted the option of binding                                                               
arbitration in order to foster the spirit of good faith bargaining.                                                             
                                                                                                                                
Number 2187                                                                                                                     
                                                                                                                                
DAN HOFFMAN, Sergeant, Fairbanks Police Department, testified via                                                               
teleconference from Fairbanks.  Mr. Hoffman supported HB 1.  He                                                                 
said that Co-Chairman Harris crystallized this issue with his                                                                   
earlier question:  where are Class(a)(1) employees left if these                                                                
employees cannot strike and the city does not have to fund an                                                                   
arbitrated award under a contract?  Mr. Hoffman pointed out that                                                                
arbitration is a fair and objective process.  If Class(a)(1)                                                                    
employees are bound by the arbitrator's awards to the agency, the                                                               
negative side, then the city should be bound by the awards to the                                                               
employees.                                                                                                                      
                                                                                                                                
MR. HOFFMAN informed the committee that the Fairbanks Police                                                                    
Department is under the contract that expired in 1993.  During the                                                              
last contract that went to binding arbitration, the city failed to                                                              
award one of the arbitrator's findings which has halted all of the                                                              
contract negotiations and collective bargaining.  He indicated that                                                             
the city could keep the police department under the old contract                                                                
forever.  The police officers do not have any recourse.  Mr.                                                                    
Hoffman emphasized the need for contracts to be negotiated in good                                                              
faith and that the option of binding arbitration truly be binding.                                                              
                                                                                                                                
REPRESENTATIVE MURKOWSKI had the impression that there are not many                                                             
situations that lead to binding arbitration.  She was concerned                                                                 
with the selective process that allows a municipalitiy to pick and                                                              
choose which of the arbitrator's decisions to fund.  How much of a                                                              
problem is this?                                                                                                                
                                                                                                                                
Number 1950                                                                                                                     
                                                                                                                                
MR. HOFFMAN said, in his opinion, this is the largest labor problem                                                             
facing the state.  This situation has only arisen from a recent                                                                 
court decision.  Prior to the court decision, municipal bodies or                                                               
local governments felt that binding arbitration was binding.                                                                    
Therefore, the local government worked as hard as possible to come                                                              
to an agreement and in the case of an impasse an arbitrator's award                                                             
was considered binding.  In the fine print of PERA, the phrase                                                                  
"subject to legislative funding" was discovered and used so that                                                                
local governments did not have to fund an arbitrator's award.  Mr.                                                              
Hoffman believed that if this situation is not remedied, every                                                                  
local government in a position to bargain will use this phrase to                                                               
take away any meaning to binding arbitration.                                                                                   
                                                                                                                                
REPRESENTATIVE MURKOWSKI asked if there have been other instances                                                               
in which a municipality has selectively funded an arbitrator's                                                                  
decision since the Fairbanks case.                                                                                              
                                                                                                                                
MR. HOFFMAN was not sure, but reiterated that this is a recent                                                                  
problem.  The problem is occurring now, after the court case,                                                                   
because local governments are currently coming to the table to                                                                  
negotiate new contracts.  Mr. Hoffman said this is why there are                                                                
attempts to put a stop to the problem before it becomes a big                                                                   
problem.                                                                                                                        
                                                                                                                                
MR. HOFFMAN, in response to Representative Dyson, said that a                                                                   
Sergeant in the Fairbanks Police Department receives an annual                                                                  
salary of $55,000-$70,000 with a total salary and benefit package                                                               
of 34 percent above the salary.                                                                                                 
                                                                                                                                
Number 1784                                                                                                                     
                                                                                                                                
CO-CHAIRMAN HALCRO noted that the information in the committee                                                                  
packet says that the council did fund pay raises, but did not fund                                                              
the four percent increase in meal and clothing allowances.  He                                                                  
asked if that was correct.                                                                                                      
                                                                                                                                
MR. HOFFMAN replied no.  After the expiration of the 1993 contract,                                                             
the attempts to negotiate a new contract have been unsuccessful.                                                                
Mr. Hoffman agreed that the Fairbanks Police Department has not                                                                 
received a wage increase in six years.                                                                                          
                                                                                                                                
MATT SODEN, Sergeant, Fairbanks Police Department, testified via                                                                
teleconference from Fairbanks.  Mr. Soden supported HB 1. With                                                                  
regards to the Fairbanks Police Department's contract, the police                                                               
department did go to binding arbitration on the wage issue as well                                                              
as the clothing and meal allowance.  The arbitrator ruled that the                                                              
Fairbanks Police Department should receive a 12 percent increase in                                                             
wages spread over about a four year period.  The city council                                                                   
refused to fund that ruling and exercised the "subject to                                                                       
legislative approval" language in PERA.  That issue went to the                                                                 
supreme court where the court supported the council's decision not                                                              
to fund the wage increase.  Mr. Soden believed that HB 1 would                                                                  
correct that discrepancy and allow true binding arbitration.  He                                                                
believed that the scale is currently tipped heavily in favor of the                                                             
city.  With regard to the previous question about the prevalence of                                                             
this problem, Mr. Soden did not see any reason why local                                                                        
governments and such would not take advantage of the situation in                                                               
the future.                                                                                                                     
                                                                                                                                
Number 1575                                                                                                                     
                                                                                                                                
RANDY COFFEY, Detective, Fairbanks Police Department, testified via                                                             
teleconference from Fairbanks.  Mr. Coffey supported HB 1.  He                                                                  
informed the committee that he was a past president of the                                                                      
association and has been around for 18 years under the city                                                                     
ordinance, collective bargaining, and binding arbitration.  Mr.                                                                 
Coffey said that binding arbitration has worked in the past.  The                                                               
arbitrator is utilized in order to help move the process along and                                                              
narrow down the points of contention.                                                                                           
                                                                                                                                
DAVE MAITLEN, Police Officer, Fairbanks Police Department,                                                                      
testified via teleconference from Fairbanks.  He supported HB 1.                                                                
Mr. Maitlen said, "The Public Employees Relations Act, under the                                                                
Declaration of Policy states in part, 'The legislature declares                                                                 
that it is the public policy of the state to promote harmonious and                                                             
cooperative relations between government and its employees and to                                                               
protect the public by assuring effective and orderly operations of                                                              
government.  The legislature further finds that the enactment of                                                                
positive legislation establishing guidelines for public employment                                                              
relations is the best way to harness and direct the energies of                                                                 
public employees eager to have a voice in determining their                                                                     
conditions of work, to provide a rational method of dealing with                                                                
disputes and work stoppages, to strengthen the merit principle                                                                  
where civil service is in effect and to maintain a favorable                                                                    
political and social environment.'"  This language makes the                                                                    
legislative intent clear, however the legislative intent is not                                                                 
reflected in AS 23.40.215, Funding and legislative approval with                                                                
regards to Class 1 employees.  Currently, a municipal employer is                                                               
not compelled to fund an arbitrator's binding award while the                                                                   
employee is bound by the arbitrator's decision.  The City of                                                                    
Fairbanks has refused to fund arbitrated wages for police and fire                                                              
departments under the aforementioned statute.  Therefore, the wages                                                             
for police officers have not changed since 1992 and the contract                                                                
for police officers expired June 30, 1993.  The wages for                                                                       
firefighters have not changed since 1990.  How can one be assured                                                               
that binding arbitration is binding on both parties?  Mr. Maitlen                                                               
believed that HB 1 would resolve this issue and urged the                                                                       
committee's support of HB 1.                                                                                                    
                                                                                                                                
Number 1300                                                                                                                     
                                                                                                                                
PERRY WILLIAMSON, Police Officer, Fairbanks Police Department,                                                                  
testified via teleconference from Fairbanks.  He informed the                                                                   
committee that he has been a Fairbanks police officer for the past                                                              
17 years.  Mr. Williamson echoed prior comments that the Fairbanks                                                              
Police Department employee's union and the City of Fairbanks felt                                                               
binding arbitration bound both sides.  Binding arbitration has                                                                  
worked in the past.  This "loophole" took away the city's                                                                       
commitment to binding arbitration.  Mr. Williamson did not believe                                                              
that the legislative intent of PERA was to allow the city that                                                                  
"loophole."  Mr. Williamson said that he was present to inform the                                                              
committee of the situation in order to change the language to                                                                   
commit both sides in binding arbitration.                                                                                       
                                                                                                                                
Number 1186                                                                                                                     
                                                                                                                                
LEONARD BROWN, Detective, Fairbanks Police Department, testified                                                                
via teleconference from Fairbanks.  He informed the committee that                                                              
he had been with the police department for 23 years.  Mr. Brown                                                                 
supported HB 1.  Mr. Brown believed that the local governments have                                                             
not commented on this issue because the local governments know this                                                             
is wrong.                                                                                                                       
                                                                                                                                
MR. BROWN posed the following scenario as an example.  What if                                                                  
suddenly legislators were required to pay their own travel expenses                                                             
which the legislator would believe to be unfair.  What if that                                                                  
issue was taken to binding arbitration and the arbitrator ruled                                                                 
that the state should pay for travel expenses, but the state did                                                                
not fund the travel expenses.  That is a similar situation to the                                                               
Fairbanks Police Department which has not had a contract with the                                                               
city for six years.                                                                                                             
                                                                                                                                
MR. BROWN said that this situation has come down to dollars with                                                                
the city council which cannot do its job in finding the funding                                                                 
when necessary.  The legislature is in the same position facing                                                                 
cutting budgets, but when an arbitrator has decided the budget                                                                  
should be funded the legislature has done so or negotiated.  He                                                                 
stated that the cities believe they do not have to fund contracts.                                                              
For the first 15 years of Mr. Brown's experience with the police                                                                
department, working out the issues together was the approach.  Mr.                                                              
Brown emphasized that employees such as himself have no avenue for                                                              
recourse if the city does not fund a negotiated contract.  Mr.                                                                  
Brown wanted what is fair and equitable for all involved.                                                                       
                                                                                                                                
REPRESENTATIVE DYSON mentioned that legislative travel home for                                                                 
Representatives has been reduced from five visits to one visit.                                                                 
Representative Dyson shared Mr. Brown's consternation.                                                                          
                                                                                                                                
MR. BROWN said that the travel scenario could be any number of                                                                  
issues such as pay.  Mr. Brown believed it sad for the transition                                                               
to the "them vs. us" attitude which has not been the case in the                                                                
past.                                                                                                                           
                                                                                                                                
REPRESENTATIVE KOOKESH pointed out that the Minority has only                                                                   
received one paid visit home each year.                                                                                         
                                                                                                                                
Number 539                                                                                                                      
                                                                                                                                
CO-CHAIRMAN HALCRO surmised from Mr. Brown's testimony that this                                                                
problem of not funding an arbitrator's award has happened in the                                                                
case of the Fairbanks Police Department only once.  Co-Chairman                                                                 
Halcro also understood Mr. Brown to indicate that over the last                                                                 
couple of years the city council has become miserly and refused to                                                              
negotiate; is this attitude due to the lack of available funds or                                                               
the general dislike of the Fairbanks Police Department?                                                                         
                                                                                                                                
MR. BROWN believed that the city council is probably in the same                                                                
position as the legislature as far as down-sizing and funding is                                                                
difficult.  However, it is the job of the city council to find the                                                              
funding for a decision from an arbitrator.  Mr. Brown did not                                                                   
believe the city council hated the police department.  The                                                                      
Fairbanks Police Department has not received a wage increase in six                                                             
years.  He pointed out that the rest of the country has caught up                                                               
to Alaska's pay scale.  In conclusion, Mr. Brown said the city                                                                  
should be held accountable to the arbitrator's decisions.                                                                       
                                                                                                                                
REPRESENTATIVE MURKOWSKI noted that she too had received the                                                                    
impression from Mr. Brown's testimony that the city was retaliating                                                             
against the police department.  Representative Murkowski understood                                                             
Mr. Brown's response to Co-Chairman Halcro to be that the situation                                                             
basically comes down to fiscal concerns.                                                                                        
                                                                                                                                
REPRESENTATIVE JOULE reminded the members that much legislation is                                                              
passed due to a single incident; just two weeks ago this committee                                                              
passed legislation in response to a single incident.  Sometimes it                                                              
is necessary to get behind a single incident to avoid multiple                                                                  
incidents.                                                                                                                      
                                                                                                                                
Number 0123                                                                                                                     
                                                                                                                                
CO-CHAIRMAN HARRIS asked if binding arbitration is utilized and                                                                 
communities are making decisions based on a lack of funds, will an                                                              
arbitrator's wage increase award result in the laying off of                                                                    
employees to pay for the service.                                                                                               
                                                                                                                                
MR. BROWN said, "I guess you could always say that they could say                                                               
well, if we have to pay you money then we're going to have to lay                                                               
off people.  I certainly wouldn't put that past the city to do                                                                  
that, instead of trying to find a reasonable way to find funding."                                                              
                                                                                                                                
TAPE 99-10, SIDE A                                                                                                              
                                                                                                                                
[RECORDER MALFUNCTION; APPROXIMATELY ONE MINUTE OF TESTIMONY WAS                                                                
MISSED, DURING WHICH TIME MR. BROWN AND CO-CHAIRMAN HARRIS SPOKE.]                                                              
                                                                                                                                
Number 0003                                                                                                                     
                                                                                                                                
MR. BROWN stated, "We've always given back to the city; in every                                                                
situation where they said, 'We're going to lay people off,' our                                                                 
officers have gotten together and said, 'Okay, we'll give this up.'                                                             
But it's not all just about total money or dollars.  It just comes                                                              
down to an entire contract.  If they don't fund one item, you have                                                              
no items.  And then they go back to - like here we are - a contract                                                             
that's six years old."  He said they gave up 3 percent one time,                                                                
and perhaps 4 percent another time, for at least a three-year                                                                   
period, so that the city wouldn't lay off officers.  He emphasized                                                              
that with no contract, they are at the city's beck and call.                                                                    
                                                                                                                                
Number 0329                                                                                                                     
                                                                                                                                
REPRESENTATIVE DYSON requested that the next hearing be delayed                                                                 
until hearing from the Alaska Municipal League, in which case he                                                                
would defer his questions.  He then told members he had misspoke,                                                               
and that he believes he was reimbursed for three trips; however,                                                                
none of the trips he had wanted to make this year to conferences                                                                
were being funded.                                                                                                              
                                                                                                                                
Number 0422                                                                                                                     
                                                                                                                                
CO-CHAIRMAN HALCRO asked whether there have been contract talks or                                                              
ongoing discussions.                                                                                                            
                                                                                                                                
REPRESENTATIVE BRICE said there are.                                                                                            
                                                                                                                                
CO-CHAIRMAN HALCRO recalled that in Anchorage there had been a                                                                  
situation for years with the firefighters, with a delay because the                                                             
city had appealed the binding arbitrary award, taking issue with                                                                
how the determination was made.  When the supreme court ruled                                                                   
recently that the city had to abide by the final terms and                                                                      
conditions, the taxpayers were left to foot the bill, including                                                                 
interest.  Co-Chairman Halcro noted that the committee had heard                                                                
from only one side on the Fairbanks situation.  He inquired whether                                                             
the city council had done cost studies or surveys that showed that                                                              
the Fairbanks Police Department officers were paid more than the                                                                
national average, for example.  He asked what the feeling is in                                                                 
Fairbanks.                                                                                                                      
                                                                                                                                
REPRESENTATIVE BRICE replied that the bill has been out for a                                                                   
month, and there was talk about it for a number of months before                                                                
that.  However, there has been no feedback.  He said he cannot                                                                  
speak to the city council's response, then suggested Mr. Drygas or                                                              
Mr. Soden could address the issue.  He stated his own understanding                                                             
that there are regular Tuesday meetings where the negotiations have                                                             
been fruitless.                                                                                                                 
                                                                                                                                
Number 0750                                                                                                                     
                                                                                                                                
MR. DRYGAS explained their contract expired at the end of 1995.                                                                 
Since November of that year, they have tried to negotiate weekly.                                                               
The city has a proposal on the table that would decrease wages for                                                              
firefighters; starting firefighters now make $11.69 per hour, the                                                               
same wage as in 1990.  Although arbitration had been discussed, the                                                             
city has indicated they may not fund an arbitrator's decision.  Mr.                                                             
Drygas emphasized that his association has tried to negotiate in                                                                
good faith and has made many changes to the contract.  However,                                                                 
anything that deals with economics or benefits is at a stalemate.                                                               
There is neither a right to strike nor arbitration, and without                                                                 
some method of resolution, he foresees this continuing for some                                                                 
time.  Mr. Drygas pointed out that even if the firefighters had the                                                             
right to strike, he could not do so because of the nature of the                                                                
job.                                                                                                                            
                                                                                                                                
MR. DRYGAS told members that with binding arbitration, a third                                                                  
party could resolve these differences in a fair manner.  The city                                                               
could bring up lack of funding and wage rates, for example, and the                                                             
arbitrator would come up with an equitable decision.  It would be                                                               
a way to resolve the dispute without a work stoppage.  Used by many                                                             
municipalities around the country, arbitration is both a good way                                                               
to resolve disputes and to maintain a harmonious relationship.                                                                  
                                                                                                                                
Number 0894                                                                                                                     
                                                                                                                                
PATRICK COLE, Attorney, City of Fairbanks, testified via                                                                        
teleconference.  He indicated that two weeks ago, the city council                                                              
passed a resolution opposing HB 1 unless the city could opt out of                                                              
PERA [Public Employees Relations Act].  Both he and the city have                                                               
great respect for the firefighters and police officers.  He                                                                     
believed financial problems are not due to any attempt to punish                                                                
employees; most of their nonbargain unit employees are in the same                                                              
financial situation that the unions are in.  Years ago, the city                                                                
negotiated contracts and was able to make pay increases frequently.                                                             
However, Mr. Cole believed the tax revenues today are roughly equal                                                             
to what those 20 years ago.  The city has been under a financial                                                                
crunch, and has lost many employees to layoffs, RIPs [retirement                                                                
incentive programs] and nonreplacement over the past 15 years.                                                                  
Luckily, in the past five years some employees have been replaced,                                                              
but the city is still very short of prudent levels of service for                                                               
the community, not only in police and fire protection, but also in                                                              
other areas.                                                                                                                    
                                                                                                                                
MR. COLE told members that five years ago the city, in reviewing                                                                
the law, noticed that since the passage of PERA the state has been                                                              
able to "nonfund" contracts, which it has done many times with                                                                  
police contracts.  Nothing forbade cities from having the same                                                                  
ability, and the current situation is the result of the city                                                                    
invoking that law, trying to use the same tools to save money that                                                              
the state can use.  Mr. Cole said his ground rules prevent him from                                                             
saying anything about what has gone on at the bargaining table, and                                                             
therefore he cannot comment on Mr. Drygas's assertions.  However,                                                               
they have been negotiating.  Their contracts have a so-called                                                                   
evergreen clause, so that contracts do not expire, therefore there                                                              
are contracts negotiated in the early '90s which still exist.  The                                                              
city has struggled with the ability to provide services within its                                                              
budget.  He noted that a tax cap in Fairbanks prevents raising                                                                  
taxes beyond a very tight formula, and revenues are a significant                                                               
problem.                                                                                                                        
                                                                                                                                
Number 1119                                                                                                                     
                                                                                                                                
CO-CHAIRMAN HALCRO announced that the committee would hold HB 1                                                                 
over; it would probably be addressed again in a couple of weeks                                                                 
after a response from the Alaska Municipal League and others.                                                                   

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