[Press Conference: "City Controller's public briefing on proposed firefighter settlement" ]
[00:00:17]
BEFORE I BEGIN, UH, I WANTED TO QUICKLY ACKNOWLEDGE THE IMPACT OF THE FLOODS THAT WE'RE CURRENTLY DEALING WITH AND THANK FIRST RESPONDERS FROM ACROSS THE CITY, THE COUNTY, AND OTHER JURISDICTIONS FOR ALL THE HARD WORK THAT THEY'RE DOING TO KEEP US SAFE EVERY DAY.
AS I PLEDGE FROM DAY ONE, MY OFFICE IS WORKING TO ENHANCE THE STANDARD OF TRANSPARENCY WITHIN THE CITY OF HOUSTON TO INCREASE THE PUBLIC'S UNDERSTANDING AROUND HOW TAX DOLLARS ARE BEING SPENT AND HOW DECISIONS IN CITY HALL AFFECT ALL OF US.
I'VE MADE THE SAME COMMITMENT TO POLICY MAKERS WHENEVER POSSIBLE, WE WILL PUT USEFUL INFORMATION AT THE FINGERTIPS OF THE MAYOR AND CITY COUNCIL, TRANSLATING COMPLEX FINANCIAL AND OPERATIONAL DATA INTO A FORMAT THAT YOU CAN UNDERSTAND MORE EASILY AND THAT WILL AGE YOU IN MAKING IMPORTANT DECISIONS AND KEEPING WITH THAT COMMITMENT.
TODAY'S BRIEFING IS DESIGNED TO SHARE INFORMATION THAT I BELIEVE IS USEFUL FOR MEMBERS OF COUNCIL AND FOR THE PUBLIC.
MANY OF US STILL HAVE QUESTIONS ABOUT THE DETAILS OF THE PROPOSED FIREFIGHTER AGREEMENT, AND MY OFFICE HAS RECEIVED A NUMBER OF INQUIRIES ABOUT THE FINANCIAL IMPLICATIONS OF THE PROPOSAL.
THIS MORNING'S BRIEFINGS SPELL OUT THE ISSUES WITH THE HOUSTON FIREFIGHTER PAY IN RECENT YEARS, AND IT ALSO DISCUSSES THE FINANCIAL IMPLICATIONS OF BOTH MAKING OUR FIREFIGHTERS WHOLE FOR YEARS OF UNDER COMPENSATION AND GETTING THE PACE FAIL GOING FORWARD ON PAR WITH PEER CITIES ACROSS TEXAS THROUGH A NEW COLLECTIVE BARGAINING AGREEMENT.
WHILE WE RECOGNIZE THE BEHIND THE SCENES NATURE OF THE NEGOTIATIONS UP TO THIS POINT, OUR AIM TODAY IS TO CLARIFY THE INFORMATION THAT'S AVAILABLE TO US, BOTH FOR COUNCIL MEMBERS AND THEIR STAFF, AS WELL AS FOR CONCERNED HOUSTONIANS ACROSS OUR CITY.
UM, WITH THAT, I'M GONNA GET STARTED.
UH, I SEE THAT WE HAVE A NUMBER OF MEMBERS OF COUNCIL AND THEIR STAFF PRESENT AS WELL AS MAYOR STAFF.
UH, IF YOU ALL HAVE QUESTIONS THROUGHOUT THE PRESENTATION, THE POINT OF THIS IS TO MAKE THIS INFORMATION CLEAR TO YOU.
SO RAISE YOUR HAND, STOP ME, INTERJECT, AND WE'LL CLARIFY THAT INFORMATION, UH, FOR MEMBERS OF THE PRESS, IF YOU WOULD REFRAIN UNTIL THE END OF THE PRESENTATION, AND WE'RE HAPPY TO ANSWER ANY QUESTIONS THAT YOU MIGHT HAVE.
AND COUNCIL MEMBER THOMAS, I DIDN'T SEE YOU THERE.
THANKS FOR BEING HERE THIS MORNING.
ALL RIGHT, WITH THAT, UM, LET'S DIVE IN.
BEFORE WE GO INTO THIS ANALYSIS, I JUST KIND, I WANT TO LAY OUT THE STEPS THAT GOT US HERE.
UH, BACK IN MID-MARCH, THE MAYOR AND, UH, LOCAL 3 41 ANNOUNCED THAT A PROPOSED SETTLEMENT, UH, HAD COME TOGETHER.
THAT SETTLEMENT WOULD END LONGSTANDING LITIGATION RELATED TO BACK PAY, AND WOULD ALSO ESTABLISH A COLLECTIVE BARGAINING AGREEMENT THROUGH FISCAL YEAR 2029.
UH, THAT BACK PAY SETTLEMENT, UH, WOULD COVER FISCAL YEAR'S 2018 TO 2024, UM, AND THE SETTLEMENT AMOUNT WOULD BE FOR $650 MILLION IN ADDITION TO ADDITIONAL FEES LIKE LEGAL AND SPECIALS GOING FORWARD.
THE COLLECTIVE BARGAINING AGREEMENT CALLS FOR A 10% RAISE IN FISCAL YEAR 2025, UH, AND RAISES OF UP TO 6% ANNUALLY OVER THE NEXT FOUR YEARS THROUGH FISCAL YEAR 2029.
UM, AGAIN, WE HAVE YET TO SEE THE TERMS OF THE SETTLEMENT, UH, BUT WE HAVE BEEN BRIEFED ON THESE HIGH LEVEL FINANCIAL FIGURES.
UH, MANY STAKEHOLDERS, BOTH ON COUNCIL AND FROM ACROSS THE COMMUNITY HAVE REACHED OUT TO OUR OFFICE SAY, SAYING, HEY, TELL ME WHAT YOU KNOW ABOUT THIS.
IS THIS A FAIR SETTLEMENT? AND WE'VE BEEN CLEAR EVERY STEP OF THE WAY THAT QUESTIONS AROUND FAIRNESS ARE UP TO DECISION MAKERS.
THAT'S THE MAYOR, THAT CITY COUNCIL, UH, THAT'S LOCAL 3 41, AND THAT'S THE DECISION THAT YOU ALL WILL HAVE TO MAKE AS TO IF YOU BELIEVE THAT THIS SETTLEMENT, UH, IS FAIR, HERE'S A POSITION OF OUR OFFICE.
NUMBER ONE, TRANSPARENCY IS PARAMOUNT.
BIG DECISIONS LIKE THIS, WE NEED TO BE SHARING INFORMATION WITH POLICY MAKERS AS WELL AS THE PUBLIC.
AND SO THAT'S THE PRIMARY PURPOSE OF WHY WE'RE HERE TODAY.
UH, NUMBER TWO, OUR FIREFIGHTERS HAVE TO BE PAID COMPETITIVELY, COMPETITIVELY IF WE'RE GONNA ATTRACT TALENT AND RETAIN TALENT GOING FORWARD.
UH, WE NEED TO MAKE SURE THAT HFE AND THE CITY AS A WHOLE IS A GREAT PLACE TO WORK, AND PART OF THAT INCLUDES FAIR COMPENSATION AND COMPETITIVE COMPENSATION FOR OUR TEAMS. AND THEN FINALLY, AS WITH ALL DECISIONS THAT ARE OF THIS MAGNITUDE THAT HAVE THIS SIGNIFICANT PRICE TAG ATTACHED TO THEM, UH, WE HAVE TO BE CLEAR, THE MAYOR AND CITY COUNCIL HAVE TO UNDERSTAND FOR YOURSELVES AND THEN EXPLAIN TO THE PUBLIC HOW WE'RE GONNA PAY FOR, UH, THINGS LIKE THIS.
AND SO, AGAIN, THIS PRESENTATION TO PUT THESE NUMBERS IN PERSPECTIVE, UH, FOR YOUR BENEFIT COUNSEL, AND OF COURSE FOR MEMBERS, UH, OF THE PUBLIC.
UH, FIRST WE'LL LOOK AT THE PROPOSED CBA, WHICH IS FORWARD LOOKING FROM 2025 TO FISCAL YEAR 2029, AND THEN WE'LL LOOK AT THE PROPOSED, UH, BACKPAY SETTLEMENT.
SO SOME CONTEXT BEFORE WE LOOK INTO ANY OF THIS, UH, WE HAVE TO
[00:05:01]
UNDERSTAND WHERE FIREFIGHTER COMPENSATION HAS BEEN SINCE THE BEGINNING OF THE IMPASSE AND FISCAL YEAR 2027.AND SO WHEN YOU LOOK AT THIS CHART, AND WE TRY TO KEEP, YOU KNOW, THE GRAPHICS SIMILAR OR SIMILAR OVER THE COURSE OF THE PRESENTATION, THAT RED LINE THAT YOU SEE WITH THE SHADING UNDERNEATH IT, THAT REPRESENTS HFDS ACTUAL STARTING SALARY OVER THIS TIME PERIOD.
AND BY STARTING SALARY, WE MEAN A YEAR ONE FIREFIGHTER, UH, POST PROBATION.
THAT BLUE LINE THAT YOU SEE ABOVE IT, THAT'S THE AVERAGE SALARY OF OUR PEER CITIES ON A PER HOUR BASIS.
UM, YOU MIGHT ASK WHY ARE WE USING A PER HOUR BASIS? UH, AS MANY OF YOU KNOW, UH, OUR FIREFIGHTERS HERE IN THE CITY OF HOUSTON, UH, ACCORDING TO THEIR COLLECTIVE BARGAINING AGREEMENT AND STATE LAW WORK, 46.7 HOURS PER WEEK.
UH, THOSE NUMBERS ARE DIFFERENT IN OUR PIERCE CITY, SAN ANTONIO, FORT WORTH, AUSTIN AND DALLAS.
I BELIEVE THE RANGE IS FROM 51 UP TO 56, IF I'M NOT MISTAKEN.
UM, AND SO WHEN WE TALK ABOUT BEING COMPETITIVE, UH, WE WANNA MAKE SURE THAT WE'RE LOOKING AT AN APPLES TO APPLES COMPARISON, UH, BECAUSE GROSS PAY ISN'T APPLES TO APPLES IN SOME SCENARIOS.
RIGHT? AND JUST TO OVER CLARIFY THIS, IF A CERTAIN JOB PAYS A HUNDRED THOUSAND DOLLARS, BUT YOU WORK 20 HOURS A WEEK AND ANOTHER JOB PAYS A HUNDRED THOUSAND DOLLARS, BUT YOU WORK 40 HOURS A WEEK, THE ONE THAT WORKS 20 HOURS A WEEK, PEOPLE WOULD THINK YOU GOT PAID MORE THERE, RIGHT? AND SO, AGAIN, WE PUT THIS ON A PER HOUR BASIS, UH, TO MAKE IT AS AS COM TRULY COMPARABLE AS POSSIBLE.
BUT WHAT YOU CAN SEE FROM THIS GRAPH IS THAT ON A PER HOUR BASIS, UM, WE HAVE BEEN LOWER THAN OUR PEERS SINCE THE BEGINNING OF THIS IMPASSE.
AND I IMAGINE WELL BEFORE THAT, UH, FROM FY 2017 THROUGH 2021, UH, OUR FIREFIGHTERS DID NOT RECEIVE ANY RAISES WHATSOEVER.
STARTING IN 2022, THEY RECEIVED 6% EACH YEAR.
SO THAT'S 6% IN 22, AGAIN IN 23, AND AGAIN IN 24, AS YOU CAN SEE FROM, FROM THE CHART HERE, THOSE RAISES DON'T GET US CLOSE, UH, TO THAT AVERAGE.
IN FACT, I BELIEVE THAT WE STILL REMAIN ROUGHLY 10% LOWER, UH, THAN OUR PEERS ON A PER HOUR BASIS TODAY.
OKAY? AND SO AS WE LOOK FORWARD, THE GOAL IS TO MAKE US MORE COMPETITIVE AS WE LOOK BACKWARDS.
THE DECISION THAT YOU HAVE TO MAKE IS, YOU KNOW, WHAT'S A FAIR NUMBER TO COMPENSATE THEM FOR NOT RECEIVING THESE RAISES OVER TIME? SO THIS CHART HAS US LOOKING FORWARD.
AGAIN, WE'RE LOOKING AT THE COLLECTIVE BARGAINING AGREEMENT, UH, THAT'S PROPOSED FROM 25 TO 29.
UH, AS YOU CAN SEE, THE RED LINE OF THE STARTING SALARY FOR FIREFIGHTERS REMAINS AT THE BEGINNING LOWER THAN ITS PEERS, AND IT STARTS TO CATCH UP SLOWLY TO WHERE IN 2026, UH, IT'S ROUGHLY EQUAL.
LEMME TELL YOU WHAT THE NUMBERS REPRESENT HERE.
UM, FOR FIREFIGHTERS, HFD FIREFIGHTERS, WHAT WE SEE HERE IS A 10% RAISE IN 2025, AND IN 6% RAISES EVERY SINGLE YEAR FROM 26 TO 29.
UH, WHAT YOU SEE FOR OUR PEERS IS THE RAISE FROM 2024 TO 2025, THAT'S IMPLIED IN THEIR COLLECTIVE BARGAINING AGREEMENTS.
AND THEN WE DON'T HAVE COLLECTIVE BARGAINING AGREEMENTS FOR THEM GOING BEYOND THAT.
SO WHAT WE LOOKED AT WAS THE FIVE YEAR AVERAGE OF RAISES OVER THAT TIME PERIOD IN OUR COMPETITIVE SET, UH, THE AVERAGE IS ABOUT 3%.
AND SO WHAT YOU'LL SEE IN THAT DOTTED BLUE LINE FROM 2025 OUT TO 2029 IS AN ASSUMPTION OF A 3% RAISE, UH, FOR THOSE YEARS FOR OUR PEER SET.
SO WHAT YOU SEE, AGAIN, EVEN, EVEN WITH THE 10% RAISE IN 2025, UH, WE STILL REMAIN JUST A BIT SHORT OF OUR PEER, UH, PER HOUR AVERAGE FOR STARTING SALARY GOING INTO 2026.
AND THEN AS YOU PROGRESS IN FURTHER YEARS WITH US RECEIVING A 6% RAISE AND OUR PEERS RECEIVING A 3% RAISE, UH, WE GET TO BE ABOVE AVERAGE, UH, SALARY BY THE END OF THAT PERIOD, AND INDEED BEGINNING IN 2027.
UM, ANY QUESTIONS ABOUT COLLECTIVE BARGAINING AGREEMENT AND THE, THE GOING FORWARD RAISES COUNCILMAN POLLARD? SURE.
SO, UM, THAT IS A GREAT QUESTION.
UH, THE, I KNOW THAT IN 2024, WE'RE LOOKING AT ABOUT 51 8.
UH, I'M SAD TO SAY I DON'T HAVE THE 2029 FIGURE RIGHT IN FRONT OF ME.
AS YOU CAN SEE FROM THE CHART, IT'S IN THE BALLPARK OF ABOUT $72,000.
[00:10:01]
CAN GET YOU THAT SPECIFIC NUMBER, UH, HERE.BUT WHAT YOU STARTING AT THAT 51 8 FIGURE, WHICH IS THE ACTUAL TODAY, UH, AND YOU RAISED THAT 10% AND THEN RAISED THAT 6%, FOUR MORE TIMES, COUNCIL MEMBER CASTILLO TWO TRACKS FOR RAISES, BUT DEPENDING ON REVENUES MM-HMM
UM, IN, IN THESE YEARS OUT HERE.
SO YOU'RE PROJECTING THE FULL AMOUNT OF THE SALARY INCREASE.
WOULD IT BE POSSIBLE TO SEE THIS INFORMATION WITH THAT, THE LOWER AMOUNT? YEAH, VERY HAPPY TO SHOW YOU THE, THE, THE 4, 4, 3 3 FIGURE.
THE REASON WHY WE USE THE 6% FIGURE IS, IS THIS, WE'VE MADE CLEAR IN OUR PUBLIC STATEMENTS, AND I BELIEVE THAT THE MAYOR AND HIS TEAM HAVE MADE CLEAR IN THEIR PUBLIC STATEMENTS THAT THE ONLY WAY OUT OF THIS ISSUE, AND I DON'T MEAN THE FIREFIGHTERS ISSUE, I MEAN THE STRUCTURAL DEFICIT TO BEGIN WITH, WHICH THIS DEAL WILL TACK ONTO AND MAKE EVEN MORE SUBSTANTIAL.
UH, THE ONLY WAY OUT OF THAT IS THROUGH REVENUE OPTIONS.
UH, FROM WHAT WE KNOW TODAY, THE TRIGGER FOR THE FIREFIGHTERS GETTING THE 6% RAISE IS SUPPORT OF THOSE REVENUE OPTIONS THAT WE BELIEVE ARE NEARLY 100% LIKELY.
AND SO THAT'S WHY WE USE 6% AS THE ASSUMPTION.
UH, BUT YOU KNOW, AS WE'LL, STATE IN A, IN A COUPLE OF SLIDES HERE, WE ARE MORE THAN HAPPY TO RUN A NUMBER OF DIFFERENT SCENARIOS AND, AND CERTAINLY HAPPY, UH, TO RUN THAT FOR YOU, JUST USING BACK OF THE ENVELOPE MATH.
AGAIN, IF THEY'RE, IF OUR PEERS ARE GETTING 3% A YEAR AND WE'RE GETTING THREE OR 4% A YEAR, I THINK WE'D BE ABOUT ON PAR, UH, WITH THEM USING THOSE ASSUMPTIONS.
BUT WE'LL GET THE EXACT TO YOU, NO PROBLEM.
ANYTHING ELSE ON COLLECTIVE BARGAINING AGREEMENT BEFORE WE MOVE FORWARD TO, UH, THE BACK PAY SETTLEMENT? ALRIGHT, LET'S MOVE FORWARD.
SO, UH, WE BRING THIS SAME CHART UP IN FRONT OF YOU HERE, UH, AND I WANT TO TALK TO YOU REALLY STEP BY STEP ABOUT THE METHODOLOGY THAT WE USED, UH, TO, TO ANALYZE THE POTENTIAL SETTLEMENT VALUE.
SO AGAIN, THE POSITION OF WHAT IS FAIR, UH, IS UP TO YOU ALL.
I'M SURE THAT EACH AND EVERY ONE OF YOU HAVE IN YOUR HEAD SOME ASSUMPTION OF WHAT IS FAIR.
I IMAGINE THE MAYOR AND HIS TEAM HAVE SOME, SOME ASSUMPTION, AND I IMAGINE THAT THE FIREFIGHTERS, UH, HAVE THEIR OWN, UH, WE ARE NOT TAKING ANY SORT OF JUDGMENT IN THIS.
UH, WE RUN A NUMBER OF DIFFERENT SCENARIOS, AND WE SIMPLY DO THE MATH TO TELL YOU THAT IF YOU WERE TO PUT THE FIREFIGHTERS IN A FINANCIAL PLACE IN THE, THE DISPUTED YEARS FROM 2018 TO 2024, THIS WOULD BE THE VALUE OF THE SETTLEMENT.
SO HOW DO WE DO THAT? SO STEP ONE IS TO CREATE THE SCENARIOS THEMSELVES.
SO IF YOU LOOK AT THE SLIDE HERE, WHAT WE USED WAS A 4% ANNUAL RAISE SCENARIO.
AGAIN, WE'RE NOT OPINING ON RIGHT OR WRONG.
THIS IS JUST AN EXAMPLE, UH, FOR YOU ALL.
SO IN A 4% SCENARIO, YOU LOOK AT THOSE GREEN DOTS THAT ARE THERE ON THE SLIDE, AND THAT SHOWS YOU THE RAISES AND, UH, AND THE REFLECTIVE YEAR, ONE FIREFIGHTER SALARY THAT WOULD'VE COME FROM THOSE HAD WE GIVEN HFD RAISES OF 4% A YEAR OVER THIS ENTIRE TIME PERIOD, RIGHT? SO THAT'S STEP ONE IS JUST CREATE THIS PAY SCENARIO.
STEP TWO IS THEN TO CALCULATE THE GAP BETWEEN WHAT FIREFIGHTERS WOULD'VE MADE IN THAT SCENARIO AND WHAT THEY MADE IN REAL LIFE, RIGHT? COMPARING THAT THE PROPOSED TO THE ACTUAL, IF YOU WILL, AND MEASURING THAT DISTANCE
THAT'S FOR ILLUSTRATIVE PURPOSES.
ON THIS SLIDE, WHAT'S IN OUR MODEL IS LOOKING AT MILLIONS AND TENS OF MILLION DOLLARS A YEAR THAT IF WE GAVE FIREFIGHTERS A 4% RAISE, UH, THIS IS HOW MUCH IT WOULD COST US IN ADDITION TO WHAT THEY WERE PAID IN ACTUALITY.
DOES THAT MAKE SENSE? AND THEN STEP THREE IS TO ADD INTEREST ONTO THAT, RIGHT? UM, AS WE GET FURTHER AND FURTHER ALONG IN TIME, THOSE DOLLARS THAT FIREFIGHTERS WOULD'VE BEEN PAID IN 2018 OR 19 OR 20, THOSE ARE WORTH MORE TODAY.
AND SO WE USED A 5%, UH, INTEREST RATE.
NOW, WHERE WE ARE TODAY IS ROUGHLY IN THAT BALLPARK.
UH, WE KNOW THAT FOR MANY OF THESE YEARS WE WERE IN A LOWER INTEREST RATE ENVIRONMENT, BUT WE USE 5% AS OUR INTEREST RATE.
AGAIN, WE COULD RUN ADDITIONAL SCENARIOS AT 3%, AT 7%.
[00:15:01]
UH, WHATEVER YOU'D LIKE TO SEE, YOU KNOW, WE CAN SHARE WITH YOU.SO STEP, STEP THREE IS AFTER UNDERSTANDING THOSE GAPS BETWEEN THE VARIOUS YEARS, IT'S TACKING ON INTEREST TO THE VALUES OF WHAT IT WOULD'VE COST TO PAY FIREFIGHTERS THAT AMOUNT IN THAT YEAR.
AND THEN FINALLY YOU ADD ALL THOSE UP TOGETHER, AND THAT WOULD BE THE SETTLEMENT VALUE QUOTE UNQUOTE, FOR THAT SCENARIO.
DOES THAT MAKE SENSE? SO, AGAIN, BEING ILLUSTRATIVE HERE, UH, IF WE WERE TO DO THAT MATH ON THIS 4% SCENARIO, WHAT THAT WOULD SHOW, IF YOU CAN GO BACK, IS IF YOU GAVE FIREFIGHTERS A 4% RAISE EVERY SINGLE YEAR, STARTING IN 2018, ALL THE WAY THROUGH 2024, WHAT THEY WOULD HAVE IS A SALARY OF A STARTING SALARY, FIRST YEAR NON PROBATIONARY OF AROUND $57,300.
IN THAT SCENARIO, IT WOULD'VE COST THE CITY OVER THAT TIMEFRAME AN ADDITIONAL $260 MILLION, UH, TO COVER THOSE RAISES.
AND WHEN YOU ADD INTEREST, THAT GETS YOU UP TO ROUGHLY $300 MILLION.
AS YOU'LL SEE THROUGHOUT THIS, UH, YOU'LL SEE ROUND FIGURES THAT WE USE.
AGAIN, THAT'S TO MAKE THIS SIMPLE.
UH, OUR MODEL HAS EXACT FIGURES, BUT THE RANGES ARE IMPORTANT.
SO WHAT DOES $300 MILLION MEAN FOR THE FIREFIGHTERS? WELL, YOU KNOW, FOUR, ROUGHLY 4,000, A LITTLE BIT MORE THAN 4,000 FIREFIGHTERS.
THAT'S 65 TO $75,000 PER FIREFIGHTER.
AND IF YOU LOOK AT THAT ON AN ANNUAL BASIS, THAT WOULD BE SOMEWHERE BETWEEN NINE AND $11,000 PER FIREFIGHTER PER DISPUTED YEAR, UH, IN THIS SCENARIO.
AND SO I, I APOLOGIZE FOR OVER-EXPLAINING THIS, BUT AGAIN, THE POINT IS TO MAKE IT CLEAR SO THAT YOU UNDERSTAND THE METHODOLOGY THAT WE'RE USING, UH, FOR THESE SCENARIOS.
AND I THINK I GOT HEAD NODS, UH, FROM THE FOLKS IN THE ROOM.
SO WHAT ARE THE SCENARIOS THAT WE LOOKED AT? UH, I WANNA REITERATE FOR, AND I'M GONNA CONTINUE TO REITERATE, THERE ARE INFINITE NUMBER OF SCENARIOS THAT YOU COULD RUN FOR THIS.
UH, AS WE MENTIONED IN OUR NOTES, OUR THOUGHTS ARE AROUND COMPETITIVE SALARY FOR HFD FIREFIGHTERS.
AND SO THE SCENARIOS, UH, THAT WE RAN EMULATE COMPETITION, COMPETITIVE, COMPETITIVE, COMPETITIVE SALARY FOR HFD FIREFIGHTERS AND SOME OF THEIR PEERS.
AND SO WHAT ARE THOSE SCENARIOS? UH, THE FIRST ONE IS, HAD WE MADE HFD FIREFIGHTERS PAY EQUAL TO THE AVERAGE OF OTHER MAJOR CITY FIRE DEPARTMENTS ON A PER HOUR BASIS, THE ENTIRE TIMEFRAME.
SO GOING BACK TO THAT SLIDE THAT YOU SAW BEFORE, YOU HAD THE RED LINE AND THE BLUE LINE, IF WE HAD GIVEN THEM THAT BLUE LINE THE WHOLE TIME, THAT'S SCENARIO ONE.
SCENARIO TWO IS RELATED TO THAT, BUT IT'S A LITTLE BIT DIFFERENT.
INSTEAD OF GIVING THEM A BIG JUMP TO PUT THEM ON PAR WITH THEIR PEERS IN THAT FIRST YEAR, IT GIVES THEM STEADY RAISES OVER TIME SO THAT BY FY 2024, THE YEAR THAT WE'RE IN RIGHT NOW, THEY WOULD'VE REACHED THAT AVERAGE PAY ACROSS THE STATE.
STEP THREE, OR PARDON ME, SCENARIO THREE, COMPARES US TO OURSELVES.
SO THIS LOOKS AT THE PERCENTAGE RAISES THAT HPD POLICE OFFICERS RECEIVED OVER THIS TIMEFRAME.
AND IT SAYS, WHAT HAVE WE HAD GIVEN HFD FIREFIGHTERS THAT EXACT SAME RAISE FROM 2018 TO 2024? AND SIMILARLY, UH, SCENARIO FOUR RELATES TO OTHER CITY EMPLOYEES.
UH, OTHER CITY EMPLOYEES, OF COURSE, AS YOU KNOW, ARE REPRESENTED BY THE HOPE UNION, A LOCAL 1 23, AND THE RAISE THAT THEY NEGOTIATED AND RECEIVED OVER THE COURSE OF FISCAL YEAR 18 TO 2024 IS WHAT'S REFLECTED IN SCENARIO FOUR.
AND THEN FINALLY, UH, FOR ILLUSTRATIVE PURPOSES, WE LOOK AT TWO ADDITIONAL SCENARIOS.
UH, WE KNOW THAT THAT'S THE PROPOSED SETTLEMENT.
AND SO WE'RE, WE'RE SHOWING WITH THE SAME MATH THAT WE'RE SHOWING FOR ALL THE OTHER SCENARIOS, LIKE WHAT THAT LOOKS LIKE ON PAPER FOR FIREFIGHTER COMPENSATION.
AND THEN WE ALSO USE A $1.2 BILLION SCENARIO.
SO WHERE DOES THAT COME FROM? UH, AS WE'VE HEARD PUBLIC COMMENTARY FROM, UH, THE MAYOR FROM CITY LEGAL, UH, AND FROM HFD ABOUT THIS SETTLEMENT, 1.2 BILLION WAS ROUTINELY THROWN OUT THERE AS THE POTENTIAL LIABILITY THAT THE CITY COULD FACE.
AND SO WE RAN THAT SCENARIO AS WELL TO DEMONSTRATE WHAT FIREFIGHTER PAY OVER THAT PERIOD WOULD'VE HAD TO BE TO REFLECT A $1.2 BILLION SETTLEMENT.
UM, I'M GONNA REPEAT FOR THE 10TH TIME.
THESE SCENARIOS ARE NOT EXHAUSTIVE.
UH, IN FACT, UH, AND I'LL SHOW YOU THIS AT THE END OF THE PRESENTATION, UH, WE CREATED A WEBSITE THAT WILL GIVE YOU THE ADDRESS TO AT THE END OF THIS PRESENTATION WHERE YOU CAN GO AND NOT ONLY SEE THESE SIX SCENARIOS, BUT CREATE YOUR OWN SCENARIOS AND THEN SEE WHAT THAT SETTLEMENT VALUE WOULD BE.
SO YOU CAN DECIDE FOR YOURSELF AND THE PRIVACY OF YOUR, YOUR DESKTOP, UH, WHAT'S FAIR TO YOU.
AND IT'LL TELL YOU WHAT THE SETTLEMENT VALUE IS,
[00:20:01]
UM, FOR THAT SET OF RAISES ON EITHER A PERCENTAGE BASIS OR A DOLLAR BASIS.AND WERE YOU GOING OVER YOUR SCENARIOS? ALL OF IT WILL BE BASED ON, UM, BASE PAY OR, OR PAY PER HOUR, BUT NOTHING WILL BE INCLUDED FOR INCENTIVES OR ANY POSSIBLE OVERTIME.
IS THAT CORRECT? SO, UM, SO THIS LOOKS LIKE, LOOKS AT OVERALL COMPENSATION, UH, FOR FIREFIGHTERS DURING THAT TIME PERIOD.
UM, AND SO GIVEN THAT WE KNOW WHAT OVERTIME HOURS WERE IN THOSE YEARS, YOU CAN, YOU CAN SOLVE FOR THAT AS WELL.
IT ALSO INCLUDES ASSUMPTIONS AROUND PENSION CONTRIBUTIONS DURING THOSE TIME PERIODS.
NOW, I KNOW THAT THE WAY THE SETTLEMENT IS STRUCTURED, IT'S AN OVERTIME PAY SETTLEMENT FOR A NUMBER OF REASONS.
UH, BUT WE LOOK AT OVERALL PAY AND HOW MUCH THAT WOULD'VE BEEN, UM, IN THESE VARIOUS SCENARIOS FOR, THERE ARE TWO THINGS THAT ARE KEY TO THE CURRENT PROPOSED SETTLEMENT THAT ARE NOT IN HERE AT ALL.
THAT'S THOSE, THOSE SPECIAL PAYMENTS, AND THAT'S THE LEGAL FEES.
UM, WHAT WOULD THE SPECIAL PAYMENTS BE? I THINK WHAT'S BEEN DISCUSSED IS IN THE REALM OF FIVE TO 10 MILLION, UH, FOR THIS SETTLEMENT.
AGAIN, WE'RE, WE'RE NOT GOING INTO THE COMPLEXITIES OF THAT.
I THINK THAT'S ULTIMATELY A NUMBER THAT, UH, THAT YOU ALL ARE GOING TO AGREE TO THAT FROM A MAGNITUDE PERSPECTIVE DOESN'T NECESSARILY, UH, COME CLOSE TO THE VALUE OF, OF THE LARGER SETTLEMENT AS A WHOLE.
UM, I WOULD REALLY LIKE, UH,
UM, I REALLY LIKE THE, UH, SCENARIO ONE, TWO, AND THREE, UH, PARTICULARLY STARTING FROM, UH, JUST THE CONSISTENT INCREASE OVER TIME, RIGHT? MM-HMM
AND WHERE WE WERE PUT ON PAR AND LOOKING AT SCENARIO TWO, UM, WITH THE $270 MILLION, UH, SETTLEMENT, THAT'S SOMETHING THAT WE COULD DO TODAY, CORRECT? WELL, YOU'RE, YOU'RE JUMPING AHEAD ON ME.
AND SO, UM, BUT WHEN YOU GET THERE, I, I I, I REALLY WOULD LIKE FOR YOU TO TEASE OUT THE COMPARISON THAT WE'VE BEEN TALKING ABOUT IN TERMS OF OUR PEER CITIES FOUR SCENARIO TWO, AND THE WAY THAT YOU'VE ILLUSTRATED THAT.
OKAY? AND THEN ARE, UM, ON THE DASHBOARD THAT YOU'RE CREATING, ARE YOU GONNA, IS IT AN OPPORTUNITY FOR US TO LAYER WITH THE INCENTIVES ON THIS? 'CAUSE THIS, BASED ON WHAT YOU'RE SAYING, IT'S A BASELINE JUST ON OVERALL COMPENSATION.
AGAIN, SCENARIO WISE, WE CAN RUN ANY SCENARIO THAT YOU WANT US TO AND, AND GIVE THOSE FIGURES, UH, BACK TO YOU.
OKAY? I DON'T THINK IT'S GONNA BE THAT IMPACTFUL WHEN WE TALK ABOUT, YOU KNOW, $10 MILLION IN SPECIALS.
OBVIOUSLY $10 MILLION IS A LOT OF MONEY, BUT IT'LL BE THIS NUMBER PLUS 10 MILLION, RIGHT? AND I THINK Y'ALL ARE MORE THAN CAPABLE OF, OF DOING THAT MATH, BUT WE WANNA BE AS FLEXIBLE AND OPEN AS POSSIBLE HERE.
AND SO WHATEVER SCENARIOS YOU WOULD LIKE US TO RUN, WE'RE MORE THAN HAPPY, UH, TO DO THAT.
UM, AND, AND THAT'S THE LAST BULLET ON THE PAGE.
IF YOU HAVE OTHER THINGS IN MIND THAT ARE NOT COVERED HERE AND NOT COVERED ON THE WEBSITE THAT WE SHARE WITH YOU, RUN 'EM BY US.
UH, AND WE'RE HAPPY TO PUT THOSE INTO THE MODEL AND TELL YOU WHAT THE MODEL SPITS OUT.
ALRIGHT, SO NOW JUMPING TO TO SCENARIO ONE, AS I DESCRIBED THIS IS LOOKING AT WHAT SALARIES ARE, UH, ON A PER HOUR BASIS ACROSS, UH, OUR MAJOR CITY PEER SET AND MAKING HFD PAY EQUAL TO THEM OVER THE ENTIRE DISPUTED PERIOD FROM, FROM FISCAL YEAR 2018 TO 2024.
UH, IF WE WERE TO GO THROUGH THAT SCENARIO, THEN WE WOULD REACH OUR PEER AVERAGE IN 2024 OF $57,700 AS OUR YEAR ONE NON PROBATIONARY, UH, STARTING SALARY.
UH, IF WE DID THAT, STARTING SALARY TODAY WOULD BE 11% HIGHER THAN IT IS, WHICH IS ALMOST $6,000.
UH, WHICH I THINK IS, IS QUITE MEANINGFUL.
HAD WE, UH, REACHED THIS TYPE OF, OF COMPENSATION AGREEMENT WITH OUR FIREFIGHTERS, UH, GOING FROM 2018 ALL THE WAY TO CURRENT DAY, THAT WOULD'VE COST THE CITY ABOUT $330 MILLION OVER THAT TIMEFRAME.
UH, WHEN YOU TACK ON INTEREST FOR THOSE YEARS, THAT GETS YOU UP TO A, A CALCULATED SETTLEMENT VALUE OF ROUGHLY $380 MILLION.
UH, TO PUT IT ON A PER FIREFIGHTER BASIS, THAT'S 85 TO $95,000 PER FIREFIGHTER.
AND TO ANNUALIZE THAT OVER THE 70 YEAR DISPUTED PERIOD, THAT'S 12 TO $14,000, UH, PER YEAR PER FIREFIGHTER.
JUMPING TO SCENARIO TWO, UH, COUNCIL MEMBER THOMAS.
SO WHAT THIS DOES IS THIS DOESN'T GET YOU UP TO THAT BLUE LINE ON DAY ONE.
UH, THIS WOULD, AGAIN, THIS IMAGINES A WORLD IN WHICH WE, WE PROMISED OUR FIREFIGHTERS BACK IN 2017 THAT WE'RE GONNA GET YOU UP TO AVERAGE OVER A NUMBER OF YEARS, AND IN FACT, GETS THEM THERE IN FISCAL YEAR 2024.
UH, MATHEMATICALLY, THAT'S, THAT WOULD'VE AMOUNTED TO ABOUT A 4.1% ANNUAL RAISE.
[00:25:01]
THAT'S IN YOUR FOOTNOTES.UM, BUT YOU SEE THIS SMOOTH YELLOW CURVE AND THAT AREA UNDERNEATH IT, THAT, THAT SAYS, HEY, THIS WOULD'VE COST A LITTLE BIT MORE THAN WHAT WE PAID 'EM AND, AND, AND REALLY A LOT OF, BIT MORE THAN WHAT WE PAID 'EM.
SO, SO WHERE DOES THAT GET US? IT GETS US TO THE SAME ENDING SALARY OF 2024 OR 57, UH, THOUSAND $700.
AGAIN, 11% MORE THAN, UH, YEAR ONE NON PROBATIONARY FIREFIGHTERS ARE PAID, UH, TODAY.
UH, AND HOW MUCH WOULD THAT HAVE COST THE CITY $270 MILLION OVER THAT TIMEFRAME? WHEN YOU TACK ON INTEREST, WE'RE TALKING ABOUT ROUGHLY $300 MILLION PER FIREFIGHTER BASIS, 70 TO $80,000 PER FIREFIGHTER.
AND AGAIN, IF YOU ANNUALIZE THAT, THAT'S 10 TO $11,000 PER FIREFIGHTER, UH, PER DISPUTED YEAR WITHIN, UH, THIS IMPASSE THAT WE FIND OURSELVES IN SCENARIO THREE.
UH, SO THIS GIVES, THIS LOOKS AT THE ACTUAL RAISES THAT HPD RECEIVED IN THEIR COLLECTIVE BARGAINING AGREEMENT, UH, OVER THIS TIME PERIOD.
AND IT GIVES THOSE EXACT SAME PERCENTAGE RAISES, UH, TO OUR FIREFIGHTERS.
AS YOU CAN SEE, THIS IS NOT AS SMOOTH OF A CURVE.
UM, THE AVERAGE OVER THIS YEAR, THAT THAT FIRE THAT, PARDON ME, THAT POLICE OFFICERS RECEIVED IS A 3.5% ANNUAL RAISE.
IT WASN'T 3.5% EVERY SINGLE YEAR.
UH, IT WAS SOMETIMES HIGHER THAN THAT, SOMETIMES LOWER THAN THAT.
BUT THAT'S WHERE WE AVERAGED OUT.
UH, HAD HFD GOTTEN THOSE SAME EXACT RAISES OVER THIS SEVEN YEAR TIMEFRAME, UH, WHERE THEY WOULD END UP IS WITH A STARTING SALARY TODAY OF $55,300, UH, THAT'S ROUGHLY 7% OR $3,500 MORE, UH, THAN THE CURRENT HFD STARTING SALARY.
AND SO YOU CAN SEE THAT WHAT HPD RECEIVED OVER THIS TIME, UH, IS, IS NOTICEABLY MORE THAN WHAT HFD RECEIVED, UH, HAD WE, YES.
CAN I JUMP IN HERE? I'M USED TO JUST HITTING THE MIC IN MY SEAT.
SO, WITH SCENARIO THREE, AND I'M REALLY LOOKING AT THE, UM, ESTIMATED THE SETTLEMENT PORTION, AND WHEN WE LOOK AT OUR HISTORICALLY HIGH FUND BALANCE, AND WHEN WE LOOK AT OUR GENERAL FUND, UM, THIS IS SOMETHING THAT WE COULD ABSORB TODAY WITHOUT ABSORBING ADDITIONAL DEBT FOR 30 YEARS.
WOULD THAT BE ACCURATE? UH, THAT WOULD BE AN OPTION THAT YOU WOULD HAVE.
BECAUSE FOR ME, THE, THE, THE, UM, TENSION AND THE UPSET IS THE, IS PUTTING THE CITY IN A 30 PLUS YEAR DEBT OBLIGATION WHEN IF WE HAVE THIS SCENARIO WHERE WE CAN ONE, BRING OUR FIRE FIGHTERS UP TO SCALE, PUT THEM ON TRACK, RIGHT? ALSO ACKNOWLEDGE A SETTLEMENT, PAY THEM OUT, AND BECAUSE WE HAVE SUCH A HIGH FUND BALANCE, THEN THAT MAY PUT US IN A POSITION NOT TO OFFER HOUSTONIANS FEES AND PROPERTY TAX, UM, INCREASES.
RIGHT? SO, UM, I REALLY LIKE SCENARIO THREE, AND I WOULD LIKE IF THE, IF YOUR OFFICE CAN, UM, UM, ADD TO THE LANGUAGE AROUND THE FUND BALANCE AND THE GENERAL FUND AS THE MECHANISMS TO PAY FOR THIS VERSUS BONDING OUT.
SO WE CAN CALCULATE THAT IF WE PAY THIS IN CASH, YOU KNOW, NEXT MONTH, WHAT THAT WOULD DO TO, TO FUND BALANCE.
I'LL TELL YOU THAT IN MY ROLE AS WATCHDOG AND LOOKING OUT FOR THE FISCAL SUSTAINABILITY OF THE CITY, WE KNOW THAT EVEN BEFORE WE CONSIDER THIS SETTLEMENT, UH, THAT WE ARE FACING A STRUCTURAL DEFICIT GOING INTO NEXT YEAR, RIGHT? UH, WE'RE PROJECTING NORTH OF $400 MILLION, STILL A RECORD FUND BALANCE FOR US, TWO 60 BRINGS US DOWN TO THE $200 MILLION RANGE.
AND, UH, WHEN WE'RE THINKING ABOUT A STRUCTURAL DEFICIT OF 160 TO $200 MILLION, WHICH IS WHAT WE'RE PRO, UH, PROJECTING EVEN BEFORE HFD, THEN YOU SEE THAT WE RUN OUTTA MONEY REALLY QUICKLY.
IT IS SOMETHING THAT WE CAN LAY OUT FOR YOU.
HOWEVER, THAT WOULD DEFINITELY INCREASE THE URGENCY OF THE OTHER FINANCIAL DECISIONS THAT WE WOULD NEED TO MAKE TO, TO ERASE OUR STRUCTURAL DEFICIT, UM, GOING FORWARD.
I WOULDN'T NECESSARILY SAY IT'S THE OPTION THAT I WOULD JUMP IN WITH TWO FEET, BUT IT, BUT IT'S, IT'S WORTHY OF CONSIDERATION.
COUNCILMAN POLLEN TO FOLLOW UP ON COUNCIL MEMBER THOMAS'S POINT, UM, SHE SPOKE ABOUT IF WE WERE TO USE THE FUND BALANCE TO PAY THE ENTIRE TWO 60 MM-HMM
BUT THERE COULD BE ADVISEMENT AROUND USING THE FUND BALANCE TO JUST PAY FOR A PORTION.
AND WE'RE JUST GOING OFF HYPOTHETICALS WITH SCENARIO THREE, UM, KNOWING THAT WE DO HAVE OTHER, UH, FISCAL NEEDS THAT HAVE TO BE MET OUTSIDE OF JUST THIS AGREEMENT MM-HMM
IN THE YEARS COMING, UH, BUT TO BE ABLE TO USE A PORTION OF THE FUND BALANCE SINCE IT IS ONE OF THE HIGHEST IN THE CITY'S HISTORY.
[00:30:01]
THREE HYPOTHETICAL, UM, AND SOME ADVISEMENT AROUND WHAT WOULD A SMART DECISION POSSIBLY BE FROM A FINANCIAL STANDPOINT IF WE WERE TO USE THE FUND BALANCE, WHAT THAT MAY LOOK LIKE IN DOLLARS.SO I'M GONNA, I'M GONNA STEP AWAY FROM THE SCENARIOS FOR A SECOND AND ANSWER THE QUESTION MORE GENERALLY, UH, BECAUSE IN EITHER LAST MEETING OR THE ONE PREVIOUS TO IT, I'VE HEARD, UH, COUNCIL MEMBER ALCORN AND PERHAPS OTHERS MENTION THE IDEA OF USING SOME FUND BALANCE RIGHT NOW TO PAY OFF SOME PORTION OF, OF THE SETTLEMENT.
WHATEVER CASH YOU GIVE AWAY, YOU KNOW, TODAY TO, TO TRY AND TAKE OFF A CHUNK OF THAT SETTLEMENT.
UM, IT DOES TAKE AWAY FROM YOUR LONG-TERM DEBT.
CERTAINLY, UH, IT ALSO TAKES AWAY FROM THE CUSHION THAT WE HAVE TO DEAL WITH THE, THE STRUCTURAL DEFICIT AND THOSE CHALLENGES THAT WE HAVE, UM, RIGHT NOW.
AND SO WHILE I WOULD ALREADY SAY THAT THE FISCAL CHALLENGES THAT WE HAVE WITH THE HISTORIC FUND BALANCES ARE, ARE URGENT THAT WE HAVE A YEAR AND A LITTLE BIT OF CHANGE TO, TO GET WITHIN BALANCE.
UH, STRUCTURALLY ANY, YOU KNOW, 10 MILLION, 50 MILLION, A HUNDRED MILLION DOLLAR FIGURE THAT WE TAKE AWAY FROM THE FUND BALANCE IS GOING TO MAKE IT EVEN MORE URGENT.
THAT, THAT WE WOULD HAVE TO, TO WRITE THAT SHIP AND MAKE THE DECISIONS THAT WOULD GET US TO, TO WRITE THAT SHIP.
AND SO, AGAIN, AS WE THINK ABOUT THE STRUCTURAL DEFICIT, AND THIS IS TOTALLY DIVORCED FROM A CONVERSATION AROUND THIS SETTLEMENT, YOU EITHER GOTTA SPEND LESS OR YOU HAVE TO INCREASE REVENUE.
AND IF WE TOOK AWAY PART OF OUR FUND BALANCE, YOU GOTTA FIGURE THAT PIECE OUT MUCH MORE QUICKLY.
MOVING FORWARD TO SCENARIO FOUR, UH, THIS IS VERY SIMILAR TO, TO THE HPD SCENARIO, EXCEPT IT, IT PROVIDES THE RAISES THAT HOPE RECEIVED THAT OTHER CITY EMPLOYEES RECEIVED INSTEAD OF THOSE THAT HPD RECEIVED.
UH, OVER THIS TIMEFRAME, UM, THE RAISES THAT HOPE RECEIVED OVER THE SEVEN YEAR TIMEFRAME WERE LOWER ON AVERAGE THAN, THAN THOSE OF HPDH.
HPDS, AS YOU RECALL, AVERAGED OUT TO ABOUT THREE AND A HALF PERCENT HOPE AVERAGE OUT TO ABOUT 2.5%.
AND SO YOU CAN SEE THAT, THAT THAT SHADED PURPLE AREA IS SMALLER THAN THE SHADED AREA THAT YOU SAW, UM, IN THE PREVIOUS SLIDE.
UH, IF YOU WERE TO, TO PROVIDE HFD WITH THE RAISES, THE EXACT SAME RAISES THAT H THAT H PARDON ME, THAT HOPE RECEIVED OVER THIS TIMEFRAME, UH, WHERE YOU WOULD END UP IN THIS YEAR, FISCAL YEAR 2024, IS WITH A STARTING SALARY AGAIN, WHICH IS YEAR ONE, NON PROBATIONARY OF $51,500.
UM, AS YOU CAN KIND OF SEE AT THE END OF THAT SLIDE ON 2024, THAT NUMBER IS ACTUALLY SLIGHTLY LESS THAN HFDS STARTING SALARY TODAY.
HOWEVER, THE FACT THAT THEY GOT THOSE RAISES OVER TIME STEADILY, YOU CAN SEE THAT THERE'S, YOU KNOW, THAT PURPLE SHADED AREA IS MONEY THAT THEY WOULD BE OWED, QUOTE UNQUOTE IN THIS SCENARIO.
AND SO, AGAIN, HAD WE GONE THROUGH THIS SCENARIO, HAD HFD FIREFIGHTERS RECEIVED THE SAME RAISES PERCENTAGE WISE, THAT HOPE PROCEEDED OVER THIS ENTIRE TIMEFRAME, IT WOULD'VE COST THE CITY AN ADDITIONAL $90 MILLION IN THAT TIMEFRAME, UH, WHICH WITH INTEREST WOULD YIELD A SETTLEMENT VALUE OF $110 MILLION ON A PER FIREFIGHTER BASIS.
UH, IF YOU LOOK AT THAT ANNUALIZED, THAT'S THREE TO $4,000 PER FIREFIGHTER PER DISPUTED YEAR.
SO AGAIN, SCENARIOS FIVE AND SIX, THESE PLACE A DOLLAR AMOUNT ON THE SETTLEMENT AND THEN WORK BACKWARDS TO DISPLAY TO YOU WHAT THAT WOULD MEAN FOR, UH, INDIVIDUAL FIREFIGHTER SALARIES.
AND SO, UM, IF YOU LOOK AT THE $650 MILLION FIGURE, WHAT WOULD WE HAVE HAD TO PAY FIREFIGHTERS OVER THIS SEVEN YEAR TIME PERIOD, UM, SUCH THAT THE, UM, THE CALCULATED VALUE OF THIS SETTLEMENT WITH INTEREST WOULD EQUAL $650 MILLION.
UH, THAT'S WHAT YOU SEE IN, UH, KIND OF THIS UGLY GREEN, BROWN, UH, SHADED AREA HERE.
WHAT THIS LOOKS LIKE IS THAT IN 2018, UH, FIREFIGHTERS WOULD'VE RECEIVED A 31% RAISE, AND THEN THEY WOULD GET THAT SAME SALARY, UH, FLAT FOR A NUMBER OF YEARS UP TO 2024.
UH, AS YOU CAN SEE, AS IT COMPARES TO THAT BLUE LINE SALARIES WOULD JUMP UP HIGHER THAN AVERAGE SALARY ACROSS, UH, OUR MAJOR CITY PEERS EARLY ON, AND THEN OUR PEERS WOULD SLOWLY CATCH UP.
SO THIS RESULTS IN A 2024 SALARY, UH, $56,900, UH, WHICH IS, UH, 10% HIGHER THAN YEAR ONE SALARY TODAY
[00:35:01]
FOR NON PROBATIONARY FIREFIGHTERS.UM, HAD THIS SCENARIO PLAYED OUT IN REAL TIME, THE CITY WOULD HAVE EXPENDED AN ADDITIONAL $540 MILLION OVER THE TIMEFRAME.
AND OF COURSE, GIVEN THAT IT'S A $650 MILLION SCENARIO, IF YOU TACK ON INTEREST, THE TOTAL SETTLEMENT VALUE GETS TO $650 MILLION.
UH, WHAT DOES THAT REPRESENT ON A PER FIREFIGHTER BASIS? THAT'S 155 TO $165,000 PER FIREFIGHTER.
AND IF YOU ANNUALIZE THAT, THAT'S 22 TO $24,000 PER FIREFIGHTER, UH, PER YEAR.
AND THEN FINALLY, LET'S LOOK AT THE $1.2 BILLION SCENARIO.
UH, THIS IS THE POTENTIAL LIABILITY THAT, UH, THAT THE MAYOR, THAT LEGAL, AND THAT THE FIREFIGHTERS UNION HAVE REPRESENTED, UH, COULD HAVE BEEN OUT THERE.
I THINK IN THE MOST RECENT MEETING, I HEARD A TERM THAT WAS A, A NUMBER THAT WAS EVEN HIGHER THAN THIS.
UH, BUT WE WERE ALREADY WELL INTO THIS ANALYSIS, SO WE'RE GONNA STICK WITH $1.2 BILLION, UH, FOR THIS SCENARIO, SIMILAR TO THE $650 MILLION SCENARIO, WHAT IT SHOWS IS, YOU KNOW, BIG RAISE IN YEAR ONE AND THEN FLAT PAYMENTS, UH, FROM THERE.
AND SO YEAR ONE SALARY FOR A FIRST YEAR NON PROBATIONARY FIREFIGHTER, UH, WOULD'VE JUMPED 53%, UH, IN THIS SCENARIO UP TO $66,400.
THEY'VE RECEIVED THAT SAME SALARY YEAR OVER YEAR UNTIL 2024.
AND THAT ENDING SALARY OF $66,400, UH, IS 28% HIGHER THAN STARTING SALARY TODAY.
UH, THE COST OF THIS SCENARIO WOULD'VE BEEN A BILLION DOLLARS OVER THAT TIMEFRAME, 1.2 BILLION WITH INTEREST.
UM, THAT TOTALS 290 TO $300,000 PER FIREFIGHTER AND 41 TO $43,000 PER FIREFIGHTER, UH, PER DISPUTED YEAR.
AND SO, UH, TO SUMMARIZE, I WANNA GO BACK TO, UH, THE PRINCIPLE THAT I THINK WE ALL AGREE WITH.
IF WE WANNA ATTRACT AND RETAIN TALENT IN ANY OFFICE WITHIN THIS CITY, BUT CERTAINLY WITH OUR FIRST RESPONDERS, UH, AND OUR FIREFIGHTERS AT AT THE HOUSTON FIRE DEPARTMENT, OUR PAY HAS TO BE COMPETITIVE WITH THOSE OF OUR PEERS.
OTHERWISE, THEY'RE GONNA NOT SEEK THAT JOB AT ALL, OR THEY'RE GONNA SEEK TO GO DO THAT JOB SOMEWHERE ELSE.
I DON'T THINK THERE'S ANY DISPUTE ON THAT FACT.
WE ALSO KNOW THAT FOR YEARS, FIREFIGHTER COMPENSATION HAS NOT BEEN COMPETITIVE.
UH, THEY RECEIVED NO RAISES, UH, FROM THE PERIOD OF 17 TO 21, AND THEY RECEIVED RAISES, UH, AFTER THAT, THAT STILL REPRESENT A, A STARTING SALARY OF MORE THAN 10% LOWER THAN THEIR PEERS ON A PER HOUR BASIS.
AND SO IF WE LOOK AGAIN TO SUMMARIZE AT THE GOING FORWARD, UH, PROPOSED COLLECTIVE BARGAINING AGREEMENT, UH, THAT CBA AND THE, THE PAY SCALE THAT'S WITHIN IT, UH, IN A TWO YEAR PERIOD BY FISCAL YEAR 2026, UH, WE ESTIMATE THAT WE WOULD BE ON PAR WITH OUR PEERS ON A PER HOUR BASIS, UH, WITH A 10% RAISE AND THEN AN ADDITIONAL 6% RAISE.
BEYOND THAT, IF WE CONTINUE TO READ, RECEIVE 6% RAISES AND OUR PEERS ON AVERAGE CONTINUE TO RECEIVE 3% RAISES, THEN OF COURSE WE'D END UP WITH A HIGHER STARTING SALARY ON A PER HOUR BASIS THAN OUR PEERS, UH, BY THE END OF THE PROPOSED CBA, LOOKING AT THE PROPOSED BACK PAY SETTLEMENT.
AGAIN, IN EVERY SCENARIO WE RUN IT, WE RAN, AND THIS SHOULD NOT SURPRISE YOU AT ALL.
IT SAYS THE FIREFIGHTERS ARE OWED SOMETHING, RIGHT? I THINK, AGAIN, WE ALL UNDERSTAND THAT THERE'S NO DISPUTE THERE.
UH, IT'S UP TO YOU ALL MEMBERS OF CITY COUNCIL TO DECIDE WHAT'S FAIR AND, UH, AND WHAT YOU'LL AGREE TO.
UH, THE SCENARIOS THAT WE RAN, UH, WHICH INCLUDE THE, THE COMPARISON TO HOPE RAISES HERE AT THE CITY OF HOUSTON, THE COMPARISON TO HPD RAISES HERE IN THE CITY OF HOUSTON, AND A COMPARISON TO, UH, AVERAGE PEER STARTING SALARY, UH, WHETHER THAT'S IMMEDIATE STARTING IN 2018, OR OVER TIME REACHING THAT, THAT PARITY IN 2024, UH, THOSE, THOSE NUMBERS RANGE FROM A CALCULATED $110 MILLION SETTLEMENT VALUE UP TO A $380 MILLION SETTLEMENT VALUE, UH, FOR THOSE BACK SOLVE SCENARIOS OF 6 50, 600 $50 MILLION AND ONE, $1.2 BILLION.
UH, THOSE SCENARIOS, UH, SHOW WHAT WOULD BE A HIGHER AVERAGE COMPENSATION, UH, FOR OUR FIREFIGHTERS THROUGHOUT THAT TIMEFRAME.
UM, I'LL REITERATE FOR THE 11TH TIME, THESE ARE NOT, UM, A, AN EXHAUSTIVE SET OF SCENARIOS.
UH, WE'LL SHARE OUR WEBSITE IN JUST A MOMENT THAT WILL ALLOW YOU TO LOOK AT PERCENTAGE RAISES OVER TIME
[00:40:01]
THAT YOU CAN CHOOSE AND DOLLAR RAISES OVER TIME THAT YOU CAN CHOOSE.AND THEN IF WHAT YOU'RE LOOKING FOR ISN'T THERE, THEN WE'RE HAPPY TO RUN ADDITIONAL SCENARIOS FOR YOU, UH, YOU KNOW, ON A CUSTOM AND AD HOC BASIS.
AND IT SHOULDN'T TAKE VERY LONG TO, TO CHURN THOSE OUT.
COUNCIL MEMBER POLLARD, FIRST OF ALL, THANK, THANK YOU FOR YOUR PRESENTATION.
I THINK YOU LAID EVERYTHING OUT VERY, UH, VERY WELL.
I KNOW YOU DON'T WANT TO SPEAK TO A FAIRNESS ARGUMENT, UM, BUT FROM A FEASIBLE ARGUMENT, UM, ON AN OUTLOOK ON WHAT THE CITY CAN AFFORD BASED ON THE SCENARIOS THAT YOU HAVE RUN, UM, TELL US YOUR THOUGHTS ON, ON HOW WE AS COUNCIL MEMBERS, UH, SHOULD BE ABLE TO MAKE INFORMED DECISIONS AND BE ABLE TO TALK TO THE PUBLIC ABOUT WHAT THESE NUMBERS MEAN FROM A, UM, FROM A PAY STANDPOINT, WHAT WE CAN AFFORD.
SO I GOTTA BE CRYSTAL CLEAR BEFORE WE GIVE THE FIREFIGHTERS AN ADDITIONAL NICKEL, WE'RE ALREADY UPSIDE DOWN FROM A STRUCTURAL STANDPOINT.
AND SO WHAT WE CAN AFFORD TODAY IS WE CANNOT AFFORD OUR CURRENT SET OF SERVICES THAT WE PROVIDE TO THE CITY OF HOUSTON WITHOUT EITHER BRINGING DOWN THE COST OF THEM OR INCREASING REVENUES, UH, TO REFLECT THAT COST.
UH, YOU KNOW, OUR COMMITMENT FROM THE CONTROLLER'S OFFICE IS TO OFFER IDEAS ABOUT HOW WE CAN BE MORE EFFICIENT AND ALSO TO, UH, EVALUATE OPTIONS, NOT WITH A VALUES LENS, BUT JUST SHARING THE NUMBERS OF IF YOU PURSUE THIS OPTION, THIS IS WHAT THAT'LL GET YOU.
AND THAT'S WHAT WE SHOWED HERE TODAY, RIGHT? AND SO, AGAIN, BEFORE WE EVEN TALK ABOUT FIREFIGHTERS, WE'RE ALREADY LOOKING AT A DEFICIT NEXT YEAR, UM, OF PROJECTING 1 1 100 60 MILLION TO $200 MILLION.
NOW THE PROPOSED BUDGET WILL BE RELEASED, UM, VERY, VERY SOON.
AND THEN I IMAGINE Y'ALL WILL TACK ON AMENDMENTS, AND THEN WE'LL HAVE A BUDGET AND THAT WILL TELL US WHAT THE STRUCTURAL DEFICIT, UH, TRULY IS WITH SOME ASSUMPTIONS AROUND SALES TAX REVENUE AND PROPERTY TAX REVENUE.
UM, BUT WE'LL CONTINUE TO BANG THE DRUM THAT SAYS WE HAVE TO GET OUR, OUR FINANCIAL SHIP RIGHTED.
AND TO DO THAT, WE HAVE TO DO SOME COMBINATION OF BRINGING DOWN OUR COSTS, UH, OR INCREASING REVENUE, AND MOST LIKELY SOME COMBINATION OF BOTH.
SO I DON'T SEE ANY ADDITIONAL, UH, QUESTIONS FROM COUNCIL MEMBERS OR STAFF.
BUT BEFORE WE MOVE TO POTENTIAL PRESS QUESTIONS, ARE THERE ANY ADDITIONAL QUESTIONS FROM COUNCIL MEMBERS OR STAFF? AH, THERE'S A WEBSITE.
SO AGAIN, FOR THE 12TH TIME, THESE SCENARIOS ARE NOT EXHAUSTIVE.
UH, IF YOU VISIT THIS WEBSITE BEHIND ME, H CONTROLLER.COM/FIRE, UH, THEN YOU CAN SEE THESE SCENARIOS AGAIN AND READ MORE DETAIL.
I KNOW WE MOVED THROUGH THEM, UH, WITH A BIT OF HASTE TODAY, TRYING TO BE MINDFUL OF YOUR TIME.
BUT YOU CAN GO AND REVIEW THESE SCENARIOS THAT WE COVERED.
YOU CAN ALSO REVIEW ADDITIONAL SCENARIOS THAT YOU CHOOSE FOR YOURSELF AND SEE THE FINANCIAL IMPLICATIONS OF THOSE, UM, H CONTROLLER.COM/FIRE.
AND, UH, WE WILL SEEK TO MOVE THAT SAME CONTENT ONTO CITY WEBSITES, UH, AS SOON AS POSSIBLE, UH, AND HAVE IT THERE FOR YOU.
IF YOU HAVE ADDITIONAL SCENARIOS THAT YOU'D LIKE TO LOOK AT, UH, WE'RE HAPPY TO RUN THOSE FOR YOU AND SHARE THOSE, UH, THOSE FIGURES WITH YOU.
YOU KNOW, OUR COMMITMENT IS TO CONTINUE TO WORK WITH YOU ALL TO CONTINUE TO WORK WITH THE MAYOR, CITY COUNCIL AND OTHER STAKEHOLDERS, UH, TO PUT THE CITY OF HOUSTON ON A PATHWAY TO FISCAL SUSTAINABILITY.
PLAIN AND SIMPLE, THAT'S NOT AN EASY TASK, BUT MY OFFICE IS GOING TO DO ITS PART TO MAKE SURE THAT YOU ALL, AS POLICY MAKERS ARE WORKING WITH THE SAME SET OF SET OF FACTS AS ONE ANOTHER, UH, WITH BUDGET DELIBERATIONS APPROACHING, THAT NEED GROWS MORE URGENT BY THE DAY.
AND SO LET ME CLOSE BY THANKING YOU ALL WHO JOINED US TODAY, UM, COUNCIL MEMBER JACKSON.
I SEE YOU WERE ABLE TO STEP IN.
SO GOOD TO SEE YOU BY BEING HERE.
EACH OF US IS DEMONSTRATING OUR COMMITMENT TO INCREASING TRANSPARENCY IN CITY GOVERNMENT, AND I BELIEVE THAT THAT DESERVES, UH, RECOGNITION.
I KNOW THAT A NUMBER OF OTHER COUNCIL MEMBERS COULDN'T MAKE IT TODAY.
AND SO AGAIN, WE ARE OPEN AND HAPPY TO MAKE THE SAME PRESENTATION TO THEM, UH, PERSONALLY AND TO SHARE ANY DETAILS OF IT THAT, UM, THAT MIGHT BE ASKED.
AND SO, AGAIN, THANK YOU AND I'LL NOW, UH, BE HAPPY TO TAKE ANY QUESTIONS FROM THE MEDIA.
REALLY QUICKLY, SO WHO ARE THE PEER CITIES YOU USE TO CALCULATE THE TEXAS AVERAGE? AUSTIN FORT WORTH, DALLAS AND SAN ANTONIO.
ANY OTHER QUESTIONS FOR THE CONTROLLER?
[00:45:04]
ALL RIGHT, THANK Y'ALL SO MUCH.