San Jose reaches tentative agreement with unions on pension reforms

- San Jose city officials announced Friday they have reached a tentative agreement with eight of the city's nine employee unions, which could lead the way for implementing alternative framework to replace a controversial pension reform measure passed more than three years ago.

The agreement still has to be ratified by members of each union and approved by the City Council.

"I am extremely pleased that we've reached an agreement that secures nearly $3 billion in long-term savings and will help us restore city services and our workforce in a fiscally-sustainable manner," Mayor Sam Liccardo said in a statement.

Measure B, a pension reform and retiree health care measure, was passed by nearly 70 percent of voters in June 2012. The measure made new employees pay 50 percent of their pension costs and current employees select a lower-cost plan or make more contributions to their current plan.

The unions filed lawsuits a day after the measure passed that led to a ruling in December 2013 by Santa Clara County Superior Court Judge Patricia Lucas, who said the city couldn't increase employee pension contributions and cut cost-of-living increases under their contract.

Since then, the city has been in negotiations with the unions to settle the case.

The city already reached an agreement with the San Jose Police Officers' Association and San Jose International Association of Fire Fighters Local 230 over the summer.

Under the agreement, the unions and city must return to court for proceedings that include a "quo warranto" process to put the alternative settlement framework into effect, according to city officials.

The agreement also calls for a ballot measure placed before voters in November to replace Measure B, city officials said.

The eight unions that reached the tentative agreement represent 99 percent of the city's non-sworn workers, city officials said.

Union representatives for the city's building inspectors didn't approve the agreement, according to city officials.

"We negotiated a settlement that is fair for all parties," American Federation of State, County and Municipal Employees Local 101 president Yolanda Cruz said in a statement.

"Collaborating allowed us to begin rebuilding trust between the city workforce and city leaders so that we may collectively focus on delivering high quality services to the residents we serve," Cruz said.

"I deeply appreciate the dedication, hard work, and time that our employee groups gave over the past several months to achieve this agreement," City Manager Norberto Duenas said. "Their outstanding commitment to find practical solutions that can meet our mutual goals was essential."

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