A union’s decision to reject a concessions deal that would have saved Hartford millions has cast doubt on the city’s prospects for securing the additional state aid it needs to prevent a bankruptcy filing.
“I think that if labor doesn’t honor its commitments, it would be very difficult to help Hartford,” Gov. Dannel P. Malloy said Friday morning, a day after the American Federation of State, County and Municipal Employees Council 4, Local 1716 – one of the city’s largest bargaining groups – voted down a new contract. “Labor committed to finding savings for Hartford, so why would we ask the people of Connecticut to contribute to Hartford’s welfare if the people who’ve already made a promise to do that aren’t willing to keep it?”
Leaders of Hartford’s unions gathered in April 2016, after news of the city’s financial troubles had escalated, to announce they would work to find savings. They pledged to come up with $8 million to $12 million in concessions.
But the city has only gotten about $1.5 million so far this year. Those savings came from a deal reached in December with the firefighters union, which made sweeping changes to pension and health care plans.
“The building is filled with people who have to cast votes and they’re not all from Hartford,” Malloy said Friday, referring to the legislature. “And when folks make a promise to participate in restructuring a city and then they balk at honoring that promise … that doesn’t bode well for assistance for Hartford.
“It’s a little disheartening what happened in Hartford, and it’s concerning what could happen to people’s pensions, benefits and wages in a bankruptcy,” he added, “so I hope everyone took that into consideration.”
As the city struggles to manage its finances – officials have turned to short-term borrowing to make payroll this year – talk of bankruptcy has intensified. Hartford faces a $65 million deficit next year and a $14 million shortfall this year.
Mayor Luke Bronin acknowledged last week that the city had solicited proposals from law firms specializing in Chapter 9, which covers fiscally strapped municipalities.
The contract with Local 1716 called for four years of wage freezes, two years of pay increases and changes to benefits. Those changes included higher dental premiums and a switch to a high-deductible health plan, along with new policies for retiree health insurance and sick leave accrual. It was the second time the group had rejected a deal with the city; another agreement was rebuffed last winter.
The most recent deal would have saved Hartford about $4 million over six years.
Union officials said Friday that the contract was unpopular because there was no provision to prevent layoffs, despite significant givebacks.
“I spoke to the mayor about a guarantee of no layoffs for two years, even one,” said Kenneth Blue, president of 1716. “He said he couldn’t do it.”
Blue said the union offered to take furlough days, but was put off by drastic changes to the health plan. Many of 1716’s workers earn lower wages than members of other labor groups, he said, and they can’t absorb the hefty concessions.
While $4 million wouldn’t have solved Hartford’s fiscal crisis, local leaders and state lawmakers said the contract’s defeat sends “a bad message.”
“Overall, it’s a bad perception,” city Council President Thomas “TJ” Clarke II said. “This is the time that I think all parties need to come to a mutual agreement for the sake of the city.”
House Majority Leader Matthew Ritter said the failed deal makes it more difficult for Hartford’s legislative delegation to negotiate aid for the city.
“We are at a very critical juncture,” he said. “What we’ve always said is we need the city to do its part so we can do our part. Right now we’ve got some things that have not been fulfilled, and that doesn’t help.”
Apart from the state assistance, the CEOs of three major insurance companies promised to give Hartford $50 million over five years, provided they be “part of a comprehensive and sustainable solution” for the city. The executives haven’t said what role they’re looking to play. It was unclear Friday if the collapse of the union deal put that funding at risk.
As Hartford nears the end of its fiscal year, Bronin said, “this was a time for members to demonstrate that they’re willing to be part of the solution.”
“Local 1716’s decision to reject a fair, responsible agreement makes it that much harder to achieve what we need to achieve for the city of Hartford,” he said.
The mayor has also proposed changes to sick leave and vacation accrual for nonunion employees, though council members said this week that the measure doesn’t have support. With morale plummeting at city hall, Clarke said the changes should apply to new hires, not current employees. The council is, however, exploring caps on leave for all workers.
“I hope all of our council members recognize that reforms to sick and vacation payouts are long, long overdue,” Bronin said Friday. “This is a time for bold action and big changes and everyone needs to step up and make those changes, even when it’s unpopular.”
Courant staff writer Russell Blair contributed to this story.
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