North Riverside officials met with representatives of the North Riverside Firefighters Union on Tuesday morning for their first negotiating session related to a new contract. It could not have made firefighters very happy.
At the meeting, the details of which were not available until after press time, the village was slated to present an offer that would privatize the fire department in order to save the village an estimated $700,000 annually.
The North Riverside Village Board met in closed session after its meeting, June 23, in order to discuss collective bargaining and litigation. The collective bargaining was related to firefighters, whose prior contract expired April 30. The litigation related to a complaint brought against the village by the Illinois Department of Insurance.
On June 26, village officials must appear before the Department of Insurance to explain how it plans on funding its pension obligations for police officers and firefighters. While the village has contributed nominal amounts to its pension funds during the past two years, it failed on at least four years in the previous decade to fund its pension funds at all.
The village’s expected pension contribution for the 2014-15 fiscal year, which began May 1, was expected to be $1.8 million. That amount roughly reflects the shortfall predicted in the village’s annual operating budget.
According to a 2011 state law, if the village fails to make its required pension contributions by 2016, the state comptroller can deduct sales tax revenues — which largely fund North Riverside’s operations — to make those contributions.
Firefighters were blindsided last week when the village announced that it would seek to privatize the fire department on the cusp of union negotiations. But the plan for privatization, said North Riverside Mayor Hubert Hermanek, has been on the village board’s radar for some time.
“This has been in the making for probably six months,” Hermanek told the Landmark.
The North Riverside Firefighters Union has not publicly reacted to the village’s plan. The union is expected to have a formal statement about the situation by the end of the week, the Landmark has learned.
According to Hermanek, the contract offered to the union on Tuesday morning was a five-year deal that would shift all of the village’s 12 firefighters and four lieutenants into the employment of Paramedic Services of Illinois, the longtime paramedic contractor for North Riverside.
Hermanek said the firefighters would be taken on at their present salary levels and would be offered base pay raises of between 2 and 2.5 percent per year during the life of the contract.
However, the firefighters — most of whom have more than a decade of service to their credit — would have to also become licensed paramedics. The employees’ benefits and overtime rules would change drastically. Most importantly for the village and to the detriment of the employees, firefighters would no longer accrue guaranteed pension benefits.
While the village would still need to make contributions to the fire pension fund to fund benefits that have already accrued, by eliminating future benefits “our fire pension contribution goes down by $300,000,” said Hermanek.
By contracting out its firefighter services to PSI, the village will pay approximately $1.8 million in 2014-15, said Hermanek. In addition, the village inked a five-year contract strictly for paramedic services in December 2013. The deal, which expires in July 2019, costs the village about $500,000 per year.
North Riverside would retain its fire chief, Brian Basek, who would still direct the day-to-day fire operations within the village, said Hermanek.
North Riverside could have sought to engage other nearby municipalities to create a fire protection district in order to share costs and save money, but Hermanek said officials rejected that path.
“That would require a referendum, which would take years,” Hermanek said. “We don’t have time for referendum talk.”