Vallejo, Calif., reaches settlement with firefighters, electricians

By Jim Witters

Wilmington, Del., Nov. 28 - The City of Vallejo, Calif., reached settlements with two city unions, agreeing to pay $5.1 million to resolve claims totaling more than $30 million, according to documents filed Nov. 23 with the U.S. Bankruptcy Court for the Eastern District of California.

The claims included lost compensation and lost pension and retiree health benefits that resulted from the city's decision to reduce manpower and work hours after the city filed for bankruptcy protection in May 2008. The city originally sought to terminate its union contracts.

According to the documents filed Nov. 23, the settlements were included in the city's confirmed plan of reorganization, which became effective Nov. 1.

The agreement with the International Association of Firefighters calls for the city to pay $2.1 million to union members and $900,000 in IAFF attorney fees and costs. The payments represent a recovery of 20 cents to 30 cents on the dollar on aggregate claims of $21.5 million, the documents state.

The agreement with the International Brotherhood of Electrical Workers calls for the city to pay $1.65 million to union members and $450,000 in attorney fees and costs. The payments represent a recovery of 20 cents to 30 cents on the dollar on aggregate claims of $9.7 million, the documents state.

A hearing on the proposed settlements is scheduled for 1 p.m. ET on Dec. 12.

Vallejo filed for bankruptcy on May 23, 2008. Its Chapter 9 case number is 08-26813.

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