PLEASANT HILL — With consumers keeping their hard-earned dollars mostly in their pockets these days, the city of Pleasant Hill is doing some belt-tightening.

So when it came time to hammer out a new contract with the police officers' union, the economy wasn't the unacknowledged elephant in the room — it was smack in the middle of the negotiating table.

The two-year contract, which the City Council approved Monday, does not include a salary increase this year. Furthermore, the police department staff will receive a 2 percent pay raise in August 2010 only if the city takes in $7.3 million in sales tax and $2.5 million in property tax in the current fiscal year.

This is the first time a pay increase for Pleasant Hill workers has been tied to the city meeting financial goals. Personnel costs make up about 70 percent of the city's general fund expenditures.

"The terms of the agreement certainly reflect the economy," City Manager June Catalano said. "The idea behind that was the city is extremely dependent on sales tax revenue, which is 35 percent of our entire revenue, so we knew unless we met certain milestones the city would not be able to afford to give a raise.

"Obviously, if the economy really picks up and the city met those targets that would be a very different financial situation, but that remains to be seen."

Larry Criner, president of the Pleasant Hill Police Association, could not be reached for

In the previous four-year contract, the police department staff received a pay increase in each year of the agreement — 2 percent in 2005 and 2006; 3.5 percent in 2007 and 4 percent in 2008, according to Freda Warren, human resources manager for Pleasant Hill.

In fiscal year 2008-09, Pleasant Hill met its property tax projections, but sales tax revenue came in about $458,000 under budget, according to Mary McCarthy, city finance manager.

Under the terms of the contract, which covers both sworn and non-sworn personnel excluding managers, employees will receive a one-time $1,000 lump sum payment this month, up from $800 in the previous contract.

Other changes in the contract include extending monthly incentive pay for having an educational degree to non-sworn personnel; adding grandparent-in-law to the list of "immediate family members" whose death qualifies for bereavement leave; and giving community service officers assigned as trainers an additional 5 percent of their base salary for each consecutive two-hour period of training duty.

In the first year, the contract will cost the city about $60,000. The raises, if granted, will total about $86,000 plus benefits. Police department employees pay $55 per month for family medical coverage. The city also pays for a range of other benefits, including dental and life insurance; educational expense reimbursement and contributions to the Public Employees' Retirement System.

Richard Bolanos, a partner in the San Francisco law firm Liebert Cassidy Whitmore, acted as the city's labor negotiator. Bolanos said that while it's not common for cities to tie raises to revenue targets, more public agencies have been considering this approach since the recession began.

"I think the city and the police officers' association both worked hard to get to this contract and they both feel positive about it given the very difficult circumstances present for these negotiations," Bolanos said.

Lisa P. White covers Martinez and Pleasant Hill. Reach her at 925-943-8011.