PROVIDENCE, R.I. (WPRI) – Mayor Jorge Elorza has ordered a restructuring of the city’s fire department as part of his plan to address a stubborn structural deficit now projected to reach $19.1 million by the 2020-21 fiscal year.
The mayor said Thursday he plans to shift the department from four platoons to three, a change he says could save $5 million annually through a reduction in overtime and callback pay. Although he ordered the change to take effect immediately, he said he hopes to negotiate terms with the city’s fire union over the next month.
“We are not going to keep kicking to can down the road,” Elorza told reporters at a morning press conference.
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- In-depth: Inside the high stakes battle between Elorza and the fire union
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The changes to the fire platoons are part of a series of steps Elorza said he is taking to tackle the budget gap he expects to face starting in the 2016-17 fiscal year, which begins July 1, 2016. He maintains that his current proposed budget, for 2015-16, is a balanced one.
The mayor’s proposed budget includes no tax increase, but does raise business permit and licensing fees by 10%. Elorza also believes he can generate an additional $2 million a year through increasing parking meters on Federal Hill, parts of the East Side and the vacant I-195 land.
When he took office in January, Elorza commissioned Pennsylvania-based Public Financial Management (PFM) to conduct an “honest” long-term review of the city’s finances. The report, released by the mayor’s office Thursday, shows the city is facing a projected shortfall of $11.5 million in the 2017 fiscal year, with the gap reaching $19.1 million by 2021.
While those deficits represent a tiny fraction of the city’s overall budget – Elorza has proposed a $690-million tax-and-spending plan this year – the mayor said the ongoing yearly shortfalls are preventing the city from making strategic investments in schools and infrastructure.
Elorza said the budget gaps predicted by PFM could be significantly larger because they assume no pay increases for any public employee unions over the next five years. The firm also assumed no tax increases, which could decrease those projections.
Elorza said he believes “everything is on the table” when it comes to addressing the projected budget gaps, but indicated he doesn’t expect to seek layoffs in the fire department. He did say that the fire academy he proposed in his new budget must now be part of his negotiations with the fire union.
The changes in the fire department are already being met with staunch opposition from fire union President Paul Doughty. Elorza said he only informed union President Paul Doughty of his intentions Wednesday evening.
“We believe shift plans have always been a collective bargaining issue and there is a long history of both labor and management respecting that right regardless of recent judicial rulings,” Doughty said in a statement, apparently referring to a January R.I. Supreme Court ruling that allowed North Kingstown to change firefighter shifts unilaterally. State lawmakers are considering a bill to effectively reverse the decision.
“The mayor without negotiation or discussion has increased every fire fighters’ work week by fourteen hours without offering any details regarding compensation or how this will save taxpayers money. He also hasn’t said how this will increase public safety,” Doughty said, adding: “I can’t imagine any other industry being asked to increase their work week by 33% without compensation.”
The union has hired communications guru Bill Fischer to work as its spokesman.
As a preventive shot before the mayor’s press conference Thursday, the union announced it plans to file suit against the city for failing to make its annual required contribution to the pension system during the fiscal year when it’s due. The city’s actuarial firm announced earlier this month that the shortfall in Providence’s pension fund grew to $894.3 million last year after it revised the way it calculates the system’s assets to stop counting money the city hasn’t actually deposited into the account.
In addition to changing the fire platoons, Elorza has also recommended a restructuring of the school department’s central office, with the goal of shifting support and clerical staff into individual schools rather than housing many of them in the department’s office on Westminster Street. An audit released last week by the administration suggested the school department needs to provide better customer service.