The city's interim fire chief told City Council members on Tuesday that operating under a $90.6 million budget without layoffs or idled rigs would be challenging but possible with help from the city's fire union.
Interim Chief Bernard Kanger said labor contract adjustments would be “critical” to meet his budget.
Mayor Jean Stothert initially recommended achieving the savings through a combination of layoffs, demotions, reassignments and idled rigs.
Stothert tapped Kanger, a battalion chief, to fill in after she signed an agreement Monday for Chief Mike McDonnell's exit.
The terms of McDonnell's retirement bar the city from layoffs or idling most equipment through next July 1. City finance officials, though, said those options would return to the table next summer to save money.
McDonnell's exit agreement will add to Fire Department costs during the first half of next year, acting Finance Director Al Herink told council members.
“But then after June 30, we'll make a determination of what needs to be done,” he said.
“We'll right-size the department with the resources available. And I suppose it would be some type of layoffs and taking two rigs out of service.”
Kanger, responding to questions from council members, said the department needs to find “efficient and cost-effective” ways to operate, without undermining services.
“I'm not a supporter of shutting down apparatus or closing rigs, so I will work very hard with my management team in order to make sure that we find the resources in order to keep everything open and operating, in order to provide those services,” Kanger said.
“With regards to the labor union, I would ask them to partner with me and to be willing to discuss all options. I'm certainly willing to listen to everything that they have to bring to the table.”
If union and department officials can compromise, Kanger said, the budget can be met.
Going back to the contract “is going to be critical,” Kanger said. “There's areas there that need to be evaluated.”
More important, he said, is getting the union and fire management together “to help rebuild the trust with the public, that we're doing the right thing and we're doing it in an efficient manner.”
Stothert said the city can take other steps to create savings, such as reducing staff assigned to department headquarters or reducing overtime expenses.
In addition to agreeing to protect current department staff members from layoffs through July 1, the city agreed to maintain three assistant chief positions through 2014. The fourth chief will retire this October.
The agreement keeps all existing fire equipment in service through July 1, with the exception of a medic unit based in South Omaha. That ambulance could be idled at the beginning of next year, Herink said.
McDonnell, 47, will receive an estimated annual pension of $130,800. He said that is about $900 a month more than he would be eligible for with his 23 years and 10 months of service. The city would pay his share of pension contributions through October 2014, which would have been his 25th anniversary.
Aaron Hanson, secretary of the city's police and fire pension board, said the agreement could cost the pension system money because of the early payout to McDonnell.
“This early buyout agreement with the fire chief must be cost-neutral to the fund, as if it never happened,” said Hanson, a former president of the police union.
“As a trustee, I could care less about an agreement between two people, as long as if it doesn't negatively impact the funding of the pension plan.”
The pension board will need to approve the final pension amount, payroll manager Deb Sander has said.