While Port of Oakland commissioners have devoted great effort in recent months to ending the misuse of public funds for visits to strip clubs, massages and purchases of expensive wines, the dollars involved represent rounding errors when compared with the huge sums about to be blindly given away in sweetheart labor deals.
Last summer, port officials talked responsibly about the need to control employee costs, which were rising much faster than revenues. At the same time, pension and retiree health care programs were underfunded by at least $269 million. That debt, equal to 5½ years of payroll, must be paid from future revenues.
Encouraged by then-Executive Director Omar Benjamin, the commissioners held firm in labor negotiations as they sought meaningful change. But then attention shifted to Benjamin's $4,500 night out in Texas, he was deservedly forced out, and port officials went into damage-control mode.
Meanwhile, the heavy hand of Mayor Jean Quan and her emissary, former Assemblyman Sandre Swanson, reshaped the labor negotiations. As a result, the seven commissioners, nominated by the mayor and appointed by the City Council, on Thursday will probably rubber stamp new contracts that undermine the very principles espoused by port officials last summer.
In other words, they caved.
The deals, which run through 2015, affect more than 400 workers in four bargaining groups at the airport and the maritime facility. Here are key points:
Pensions. To fund workers' lucrative pensions, the port currently pays not only its share, currently 25 cents for every dollar of payroll, but it also picks up the employees' 8-cent portion. The new deals require workers to pay their share -- but in exchange they will receive 8 percent raises. On top of that, they will receive 2.5 percent annual raises in 2013 and in 2014.
Retiree health benefits. Workers at least 50 years old and with at least five years on the job receive fully paid health care insurance when they retire. That includes vision and dental coverage, as well as Kaiser coverage for the retirees, their spouses and dependent children.
For current employees, that won't change. There still won't even be a worker contribution to help fund the plan. The only savings in the labor packages is a requirement that new employees work longer before becoming eligible for the benefit.
Current health benefits. The port provides its current workers and their dependents free medical, vision and dental coverage. The agency pays the entire cost of insurance if workers choose Kaiser medical coverage. That didn't change under the new deal.
Finally, as an extra holiday gift, members of the largest union will also receive a $3,500 "ratification bonus." In other words, they'll get paid to take this deal, as if it wasn't good enough already.
So what will all this cost? That's anybody's guess because no financial analysis has been prepared for Thursday's meeting. Port commissioners are about to lock in a three-year deal with no meaningful financial information.
It's irresponsible. This time, the mayor and port commissioners should be ashamed.