New Orleans Mayor And Firefighters Talking Cease Fire As Lawsuits Mount

Firefighters and Mayor Mitch Landrieu’s administration may be headed back to the negotiating table in an effort to hammer out a grand bargain that would salvage the firefighters pension fund as well as resolve a half dozen lawsuits and more than $100 million in legal judgments.

Trustees for the Fire Fighters Pension and Relief Fund on Wednesday voted to give their attorney, Louis Robein, the authority to enter talks with the city. Landrieu administration officials, who face potential seizure orders and contempt charges stemming from litigation with the firefighters, have repeatedly called for a return to talks.

Before negotiations can resume, the two sides must agree on a framework for the talks. Who will serve as mediator? Will the firefighters freeze their aggressive pursuit of judgments against the city? Will the city suspend its own litigation?

Robein said that he and city officials will meet in the coming days to see in an effort to answer those and other questions necessary to know whether a return to talks is even possible.

“We are hopeful that a global mediation will fully resolve the problems facing the firefighters’ pension fund. In fact, it has been our suggestion for some time to take this approach,” said a spokesman for the city. “We look forward to working with the pension board representatives and the firefighters’ union on terms that result in a fair, reasonable and long-term solution to this challenge.”

Few would welcome a cease fire more than Landrieu.

The firefighters recently succeeded in forcing his administration to pay $5 million into the pension fund. It’s a down payment toward $26 million outstanding on a judgment related to Landrieu’s failure to fully pay the city’s required contributions to the retirement system. Civil District Judge Robin Giarrusso had suggested she could seize city assets if Landrieu, after failing to comply for months, continued to refuse to pay.

In a separate case, Landrieu and other city officials are due to appear before Civil District Judge Kern Reese on potential contempt charges for refusing to comply with his order that the city pay the firefighters $75 million in back wages. For the 16 years up to 2006, the city failed to implement longevity raises mandated by state law.

Those cases had been put on hold this spring during a previous round of negotiations aimed hammering out a grand bargain that would resolve the litigation and salvage the firefighters’ pension fund, which teeters on the edge of default.

The negotiations ended in April with the firefighters and the city on opposite sides of a canyon of lawsuits and bad blood.

The firefighters, in exchange for minor changes to the pension plan, wanted the city to pay up on both the outstanding judgments and then some, issuing a demand of $150 million. The city, under their proposal had to cough up about $10 million or more each year just to keep the fund in the black. That’s in addition to the $60 million in pension costs it already pays.

The city’s firefighter-related pension costs already outstrip its budget for firefighter salaries.

Such a plan would have likely required the city to float a bond large enough to fund about five years worth of capital improvement projects, debt the firefighters want financed through a five mill property tax increase authorized by voters last year.

The city, meanwhile, endorsed a pair of proposals that would have largely ignored the judgments the firefighters have against the city, awards for which they fought in court for years. The firefighters, meanwhile, would have had to swallow stingier benefits.

The firefighters have hinted they are willing to make some concessions, but they’ve not said how far they are willing to go. The city declined to say whether it was willing to compromise beyond the proposals it endorsed in the last round of negotiations.

From The New Orleans Times-Picayune