Vallejo, Calif., looks to reject four collective bargaining agreements, including police and firefighters

By Caroline Salls

Pittsburgh, June 18 - The City of Vallejo, Calif., has requested court approval to reject four of its collective bargaining agreements, according to a Tuesday filing with the U.S. Bankruptcy Court for the Eastern District of California.

Specifically, the city said it is rejecting its collective bargaining agreements with the Vallejo Police Officers Association, the International Association of Firefighters, the International Brotherhood of Electrical Workers and the Confidential, Administrative, Managerial and Professional Association of Vallejo.

Under a pendency plan that will take effect July 1, the city said it will continue to pay employees at the same levels they were being paid on the date of Vallejo's Chapter 9 bankruptcy filing, in compliance with an interim agreement reached in March.

Vallejo said the contract rejections are the first step toward restructuring its labor costs and developing a plan of adjustment that will return the city's general fund to solvency in the short term and will restore its financial health for the long term.

According to the motion, the city expects its general fund reserves to be completely depleted by the end of June, and Vallejo's largest general fund expenditure is its collective bargaining agreements.

The city said the largest portion of its labor costs is paid to police and firefighters.

The collective bargaining agreements are scheduled to run through June 2010, and Vallejo said its labor costs would increase dramatically over the next two fiscal years because of significant salary increases.

A hearing is scheduled for July 23.

Vallejo filed for bankruptcy on May 23. Its Chapter 9 case number is 08-26813.

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