San Bernardino Mayor Blasts Police Union as Agreement Crumbles

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LOS ANGELES — The mayor of bankrupt San Bernardino, Calif. blasted the city's police union Wednesday for seeking to change the terms of an agreement struck on Aug. 14 under the "guise of clarification."

The tentative agreement, reached between the police union and the city in August through the confidential bankruptcy mediation, was unanimously passed by the City Council and approved by the police union's membership, San Bernardino Mayor Carey Davis said in a statement.

The San Bernardino Police Officers Association announced on Oct. 2 that the agreement between the city and police had fallen apart.

The changes to the agreement sought by the San Bernardino Police Officers Association would add additional burdensome costs over the life of the contract, Davis said.

"Both parties affirmed to U.S. Bankruptcy Judge Meredith Jury in federal bankruptcy court that a tentative agreement had been reached through mediation," Davis said. "The announcement by the union leadership that the city has misinterpreted the terms of the agreement is simply not true."

SBPOA attorney Ron Oliner said in an Oct. 14 court document that the tentative agreement was "revoked by the city when it attempted to implement terms at variance with the agreement."

Oliner speculated that the city has been emboldened by U.S. Bankruptcy Judge Meredith Jury's ruling on Sept. 11 that the city could break its contract with the fire department and the oral ruling by U.S. Bankruptcy Judge Christopher Klein in the Stockton bankruptcy that pensions could be impaired in bankruptcy court.

The police union, like the city's other creditors, has been involved in confidential mediations since late November that are subject to a gag order from U.S. Bankruptcy Judge Gregg Zive, the judge handling the mediation.

The City Council and the union separately approved the terms of the contract, but SBPOA President Steve Turner told The Bond Buyer previously that the agreement was always tentative and was never signed. Turner called the breakdown in negotiations a result of the city interpreting the agreement in a way that was unacceptable.

The mayor said that the police union sought to change the terms of the agreement after it was approved by both sides.

"A deal is a deal, and the fact that union leadership, through their announcement, would attempt to set aside a judicially mediated agreement and renegotiate is disturbing," Davis said.

The mayor claimed the police officers understand a long-term agreement is necessary to a successful bankruptcy exit, but the union leadership is now demanding "more than what they agreed to in the mediation process."

Davis added that while the city cannot afford the union's additional demands it is willing to return to the mediation process.

Neither party can discuss the specifics of the agreement, because of the judge's gag order on the mediation, but Davis said the agreement had been favorable to both sides.

"It is the city's hope that union leadership will correct their action, honor the agreement, and resume discussions with the city in good faith through the mediation process," Davis said.

The city reached an agreement with the California Public Employees' Retirement System in June backing away from efforts to impair CalPERS after missing a years' worth of payments totaling $13 million to the pension fund.

After announcing the agreement with the police union in August, city officials had said mediation conferences had been scheduled with bondholders for September and October. Bondholders had taken a back seat while the city negotiated with CalPERS and the city's unions.

Oliner also asked the judge to set deadlines for the city noting that the city has already spent $6.5 million on legal expenses. The city has been in bankruptcy since July 2012, but has yet to present the plan of adjustment needed to exit bankruptcy.

"While the city's leaders continue to spend huge sums on lawyers in this case, the city will be unable to retain or hire qualified police officers without a competitive contract. As a result, crime statistics will continue to rise," Oliner said.

The number of homicides in the city has risen from 32 in 2009 to 46 in 2013, a 40% increase, Oliner said.

The parties are due back in court on Nov. 6.

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