RIVERBANK — The city has reached tentative agreements with its employees that call for them to take 12 furlough days for the budget year that starts Thursday.
The deals with the bargaining groups that represent the city's middle managers and rank-and-file workers are part of the city's effort to come up with at least $200,000 in savings to beef up its general fund reserve for the upcoming budget year, City Manager Rich Holmer said.
Holmer and the city's six department heads also have agreed to take 12 furlough days.
The furloughs for rank-and-file workers, department heads and the city manager represent about a 4.4 percent pay cut and will result in about $159,000 in annual savings, Finance Director Marisela Hernandez said.
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The furloughs for the city's 11 middle managers will save less money because the middle managers' contract calls for them to receive a 4 percent cost-of-living increase for the new budget year. On Thursday, the middle managers will be in the final year of their three-year contract.
No other employees will receive such an increase.
Holmer said he needs to come up with an additional $40,000 to $50,000 in savings and thinks the city might not have to lay off anyone to reach those savings. He will look at other cost-saving measures.
The tentative agreements with the two bargaining units are expected to go before the City Council for approval at its July 12 meeting.
The city has scrapped a proposal to close one Friday every month to implement the furloughs.
The City Council passed a $6.9 million preliminary general fund budget Monday. The general fund pays for basic city services such as law enforcement. The city will use about $368,000 from reserves to balance its general fund, leaving about $471,000 in the reserve account.
The city needs to increase reserves to at least $659,000, which is the required 10 percent minimum reserve of general fund revenues.
The city plans to pass a final budget in September.
Holmer said that for the fiscal year that starts July 1, 2011, the city wants employees to start paying for some of the costs of their benefits, such as contributing toward their pensions and health insurance.
The city now pays the entire cost of employee benefits. But City Council members recently have said those costs are not sustainable for the city over the long term.
Bee staff writer Kevin Valine can be reached at email@example.com or 578-2316.