After 2 Years, Birmingham Firefighters Association Settles Contract With City

After almost two years of negotiations and arbitration, the Birmingham Firefighters Association has agreed to a stipulated contract through 2014 with the city of Birmingham.

This makes the firefighters the final city group to shift its retirement plans to a money-saving defined contribution plan.

"By having this last group come on board, we've significantly modified the city's retirement program to eliminate the legacy costs that we've had to deal with," Assistant City Manager Joe Valentine said.

The previous contract with the 22-member Birmingham Firefighters Association Local 911 expired in July 2010. The new contract will last through July 2014.

Different retirement plan could save city money

According to Valentine, the terms of the stipulated contract are similar to those of the .

The biggest change is the shift from a defined benefit retirement plan to a defined contribution plan, a move Valentine said could save the city thousands of dollars a year.

In fact, the firefighters association is the last city employee group left to shift to a defined contributions plan for new hires. According to Valentine, a defined benefit program provides a set benefit amount for retired firefighters. Under a defined contributions plan, however, employees and the city will contribute to a health care account over the course of an employee's career. At the time of retirement, the retiree will have access to all the assets in the account.

According to Valentine, defined benefit plans involve substantial legacy costs that have to be paid by the city over the lives of all retired employees.

"What we've done by closing the current defined benefit program is cap the liability costs the city has and essentially eliminated those (costs) in the future," Valentine said.

The new health care plan will only impact employees hired after April 1, 2012, Valentine said. Existing employees will retain their current plan.

Firefighters Association President Paul Wells acknowledged that compromises had to be made on the part of new hires in order to move forward on a contract.

"Our local has accepted the city's retirement package as well as other concessions for new hires that will significantly assist the city's many concerns with regard to the unfunded liabilities and it aligns us with the private sector," he said.

"While we realize that nothing is ever perfect, we are grateful to work for what we feel is the most fiscally responsible city in the state of Michigan."

Also part of the contract, there will be no wage adjustments through July 2013 for firefighters. In 2013, the contract has a 2 percent wage increase.

Also included in the contract was a $400 increase in the premium firefighters are paid for serving as fire inspectors every year, now $1,000 instead of $600.

Ambulance transport services back on track

Looking ahead, Wells said now that a contract has been signed, the firefighters are hoping to move forward on a plan to provide ambulance transport to area hospitals.

A plan for the to provide ambulance transport has been on the books since November 2009, when commissioners approved the plan. Currently, a private ambulance service takes patients to hospitals after a medical call, even though Birmingham firefighters — and the department's staff of 11 total paramedics — are often the first on the scene.

By providing its own ambulance services, , and all money raised would go straight into the city's general fund.

"There is revenue here that could come back to the community for doing nothing more than (what) we are already doing," Fire Chief Mike Metz said.

"This service will serve as a significant revenue source for the city's general fund at no additional cost to the city or its taxpayers," Wells added.

In a presentation to the Birmingham City Commission on April 21, Metz told commissioners the department plans to begin offering transport services this year.

The delay, Assistant Fire Chief John Connaughton said, was largely due to union negotiations, during which firefighters were concerned about manpower levels if they had to transport patients to the hospitals.

However, with the new contract, Connaughton said everyone has moved past that point and ready to move forward. The fire department need only finish , and then it will be ready to begin providing transport.

"We're not far away at this point," Connaughton said. "I know the commissioners are excited and we want to get moving with it."