Nutter won't appeal police contract

Mayor Nutter said yesterday he had reluctantly opted not to appeal an arbitration panel's decision on a police contract that will blow a hole of at least $123.5 million in his five-year spending plan.

As "challenging" as those acknowledged costs will be for the city, Nutter said, they are worth enduring to protect long-term pension and health-care reforms, which he said would save taxpayers at least $190 million over the next 30 years.

"City government must now make its decisions based on the longer-term fiscal health of the city and watch out for the taxpayers' dollars, as opposed to making the short-term, easier decision, which would put all these potential gains at risk," Nutter said.

Yesterday was the deadline to appeal the award, which was released last month by a three-member arbitration panel.

John McNesby, president of Lodge 5 of the Fraternal Order of Police, said his union would not appeal either, and he proclaimed himself "elated" at Nutter's decision not to reopen the award.

The contract, McNesby said, "is a positive thing for both the city and the cops."

The five-year contract includes raises totaling 7 percent over the next three years, with the potential for additional raises in the fourth and fifth years.

It also erodes the residency requirement, and will eventually permit most police officers who want to live outside the city to do so.

For its part, the Nutter administration convinced arbitrators to introduce an optional retirement benefit for future police officers that could help ease the burden on Philadelphia's stressed pension fund. The city was also granted the authority to make an administrative change in health care that will not affect police benefits but could save the city nonetheless. Co-pays are up in the award as well.

The contract also includes some significant work-rule changes that should save the city money. Chief among those is the city's new ability to furlough police officers up to 30 days each year, a power that, if aggressively used, could blunt the effect of the salary increases.

Nutter said there were "significant, significant risks" in appealing, as the matter would ultimately end up back before the same arbitration panel. The panel, Nutter said, could then choose to do away with the pension and health-care changes that the mayor has repeatedly characterized as "historic" and "unprecedented."

Councilman Bill Green considers the mayor's descriptions of the pension and health-care changes to be overblown.

"It's a complete disaster," Green said of the police award. "I don't understand how you cannot appeal it. It is a slam-dunk appeal."

Green, one of Nutter's most frequent critics, said that the long-term gains were dwarfed by the salary increases, and he warned that the award portended steep budget cuts in the near future.

When asked what terms he would have considered fair for police and taxpayers, Green said, "I don't begrudge the police anything, but there are 6,500 of them, and there are 1.4 million residents we have to worry about as well."

Green said the salary hikes might have been acceptable if they had been accompanied by more robust pension and health-care cuts and such changes as outright city control of the police health-care plan, lowered pension benefits, and upward adjustments to the pension vesting schedule.

One element of the police award that has not received much attention is the furlough clause, partly because Nutter officials have suggested it will not be practical to furlough police on a widespread basis.

But Nutter administration managers would not be so reluctant to furlough other city workers, and they hope the inclusion of unpaid time off in the police award will serve as a precedent for other city union contracts, all of which are still outstanding.