MIAMI, July 26 Miami officials pushing for $40
million in union concessions weighed on Thursday declaring
"financial urgency," an action that would allow the Florida city
to unilaterally alter employee contracts, according to a media
The Miami Herald website on Thursday quoted Miami Mayor
Tomas Regalado as saying the declaration would be issued on
Thursday by City Manager Johnny Martinez because the savings
were needed to balance the city's $485 million operating budget
for the next fiscal year.
"The unions are not cooperating with the process," Regalado
told the Herald. "We need to have a balanced budget."
Regalado and Martinez did not respond to inquiries seeking
comment on the report, though Regalado defended the proposed
cuts at a meeting of the Miami City Commission.
Other city officials declined to comment on the timing of
the expected declaration, which had been issued by late on
Regalado, who has used the Florida financial urgency law
three times to impose staff spending cuts since 2009, said
austerity was needed, would encourage outside investment and
migration, and leave the city of 410,000 well placed.
"The base of the future will be better," Regalado said.
Miami officials are pushing for the concessions from the
city's four government workers' unions as part of a plan to plug
a $60 million gap. Overtime limits for firefighters and higher
health insurance contributions are among the city's proposals.
Part of the budget shortfall is caused by the scheduled
expiration of temporary concessions made last year by police and
other unions. Almost 80 percent of Miami's budget goes to
compensate city workers.
STUNG BY HOUSING COLLAPSE
Labor leaders told city commissioners on Thursday that
Miami's unions had made substantial give-backs to help ease
financial pressure on the city. Firefighters said their pay has
been reduced by 35 percent in recent years, when the city
declared financial urgency three times.
Miami was losing experienced workers and having difficulties
recruiting new ones because of the cutbacks, union leaders said.
They said the city should consider increasing property taxes
that Regalado has proposed reducing.
Stung especially hard by the U.S. housing collapse, Miami
used Florida's financial urgency law in May 2010 to change labor
terms that saved the city $80 million. Other Florida cities,
like nearby Hollywood, have also used the law to force pay cuts
on government workers.
On Wednesday, Moody's Investors Service put $669 million of
Miami's debt on review for possible ratings cuts after federal
regulators determined that city officials had misled bond
investors about its finances.
Other leading ratings groups, Standard & Poor's and Fitch,
said their analysts were closely watching the inquiry by the
U.S. Securities and Exchange Commission but would take no
immediate ratings actions on Miami's debt.
"While Fitch is concerned about the costs and potential
operational disruptions associated with the ongoing
investigation, recent financial results indicate some modest
improvement in the city's overall financial position," Fitch
said in written statement.