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BACKGROUND The International Association of Firefighters, Local 1974 (IAFF) covers a total of 106 sworn fire employees (12 firefighters, 30 paramedics, 30 engineers, 30 captains and 4 inspectors). The ranks of battalion chief and above are designated management employees and not represented. The current Memorandum of Understanding (MOU) with this group covers the period August 1, 2007 through December 31, 2011. The City is introducing this matter in public session to allow for open discussion prior to the formal initiation of contract discussions. All agreements reached between the parties during the meet and confer process are tentative until the contract, in its entirety, is ratified by members of IAFF and approved by the City Councils of Pleasanton and Livermore. DISCUSSION In accordance with the Meyers-Milias-Brown Act, the parties are required to meet and confer in good faith over items covered within the scope of representation, including wages, hours and other terms and conditions of employment. Generally speaking, typical areas for negotiations include: Term of agreement: In light of the recent economy, the trend is for contract terms to be shorter, which allows greater flexibility to make adjustments should the economic environment change significantly. Wage adjustments: In preparation for wage adjustment discussions, staff prepares a salary survey comparing the average wage for the suppression classifications with those of designated survey agencies. These ten organizations are located in close geographical proximity to the Livermore-Pleasanton Fire Department, have comparable staffing and number of fire stations. In addition, these agencies serve similar type and relative size of populations. Finally, other data taken into consideration include the consumer price index (CPI), which reflects the general cost-of-living increases in the San Francisco-Oakland-San Jose area. Benefits: Other topics that are typically discussed include benefits such as the City's retirement program. Fire personnel currently have the 3% @ 50 formula under the CaIPERS pension program. The cost for this program is expressed as a percentage of salary for covered IAFF employees and is included in the attachment to this staff report. The employee contribution of 9% is currently paid for by the City as employer paid member contribution (EPMC). Mr. John Bartel, President and Chief Actuary of Bartel and Associates, will be present at the City Council meeting to review the performance of the fire plan and the suggested focus areas for pension sustainability. Many agencies are negotiating for employees to pay the member contribution and to agree to a different retirement tier formula for new employees hired in the future. Other topics for discussion include health related benefits (e.g. medical plans) as well as non- health related items. Page 2 of 3