Costa Mesa's municipal employee union presented a contract counteroffer Thursday that includes changes in pay, a reduction in sick time accrual and an increase in the employees' pension contributions.

The proposed two-year Costa Mesa City Employees Assn. contract — officially known as a memorandum of understanding, or MOU — calls for "common-sense wage metrics," according to the CMCEA's website, CostaMesaWorks.com.

The metrics would provide a half-percent "general wage" increase or decrease for every 1% that the city's General Fund increases or decreases.

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If the General Fund increases by 2%, for instance, CMCEA employees would get a 1% raise, said Jennifer Muir, spokeswoman for Santa Ana-based Orange County Employees Assn., which represents the CMCEA and other employee unions. Should the opposite happen, employees would be subject to a 1% decrease, Muir noted.

The increase or decrease would take effect Sept. 1 of each year of the contract, using fiscal year 2011-12 as a baseline. Such a change would not affect "step increases" — salary bumps as employees advance in a given job category.

The CMCEA contends that its workers haven't had pay increases since 2008, a notion the City Council majority calls dishonest because it ignores the step increases.

Muir, however, said the majority of CMCEA's membership — about 60% of its 200-some employees — are already at the top pay scale for their job title and don't receive step increases.

In a prepared statement, CMCEA President Helen Nenadal called her association's counteroffer "a proposal that conveys our desire to work collaboratively with the city."

"Our proposal focuses on partnering to help make Costa Mesa work better, work more efficiently, and deliver the best service possible to the community," Nenadal said. "It also includes some common-sense reforms aimed at improving accountability and transparency for the public. We truly hope the city will consider our proposal in the same spirit of collaboration."

Mayor Jim Righeimer countered that the union's proposal is "another attempt to wrestle control of the city from residents and taxpayers and their elected representatives, and put it into the hands of union officials."

What's wrong with the proposal is that it "goes right back to what got the city in financial trouble in the first place: a partnership with the unions," Righeimer said in a prepared statement. "In the past, unions have used their contracts to manage the city and dictate its budget — with disastrous results for the taxpayer. And this proposal gives the union even more control of the city's management and finances."

He said the city's partnership is with its residents and taxpayers.

"We are not looking to have the unions co-manage the city of Costa Mesa," Righeimer said. "We will continue to pay extremely good wages and benefits to our employees. Our compensation packages are so generous that we have virtually no employee turnover."

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Sick time, pensions, layoffs

The CMCEA's proposal also includes eliminating any future accruals of sick time for what's called a secondary leave bank, which complements a primary sick leave bank.

As it stands now, employees can accumulate up to 96 hours a year in their primary bank, with a cap of 480 hours. Additional accrued sick leave can go into a secondary bank that has no accrual maximum.

Proposed changes include requiring "employees to exhaust any current secondary leave bank balance before utilizing normal sick leave," reducing the "maximum sick leave accumulation from 480 hours to 432 hours," and reducing "sick accrual from 3.6 hours per pay period to 3.2 hours per pay period."

Other proposals include a nearly 2% increase of employee pension contributions — from 8.52% to 10.469% — and an employer-employee working group would also be formed "to discuss future changes to CalPERS contribution levels."

The contract would not allow layoffs "except in case of catastrophic fiscal emergency" — defined as a 5% or more revenue decline in the General Fund — with fiscal year 2011-12 as a baseline.

"After two and one-half years of uncertainty, Costa Mesa, its residents and employees will all benefit from assured continuity of municipal services and relative stability in the workplace," reads a statement on CostaMesaWorks.com. "A commitment by the city to not institute layoffs during the term of this MOU will be a significant step in that direction."

The proposal also calls for implementing alternative work schedules, such as a 10-hour workday for four days, rather than eight hours over five days. "Non-essential" city functions may also be closed between Dec. 24 and Jan. 1 as a cost-saving measure.

Thursday's bargaining-table discussion lasted about an hour and a half, Muir said.

"Generally, we talked about our proposal and our desire to turn a tide, to turn a new leaf with the city and work collaboratively," Muir said. "Our purpose obviously represents a desire to partner with the city and have a positive relationship, and also to install transparency and accountability."

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Next step

The next meeting date to discuss CMCEA's contract, which expired in March, is Sept. 24.

The city's offer — presented Aug. 6 with help from an independent negotiator, Richard Kreisler — included an across-the-board 5% pay cut and a 5% increase in pension contributions. The CMCEA leadership dubbed the proposal "offensive," though Righeimer said it was a return to "normalcy" and that city employees are, by and large, well compensated for their service.

Costa Mesa's initial offer also asked for various cuts to employee sick leave and vacation time as well as a potential 5% cut in such time for top-tiered employees during performance reviews.

Righeimer said at the time that one of his biggest problems with the current setup was the ability of some employees to "cash out" unused sick leave and vacation time in the amount of tens of thousands of dollars.

The government payroll system, Righeimer told the Daily Pilot in August, is like a "science of how you can drastically increase your income without the world knowing what you're really making."