Amid financial challenges, bargaining continues with labor unions

Bargaining with three of the City's labor unions continues as part of ongoing efforts to reach fair agreements that balance employee needs with the City's current financial realities. With a projected budget shortfall for the upcoming fiscal year, any additional financial commitments will challenge the City's ability to close the gap without deeper spending reductions.

Financial Outlook and Budget Impacts

The City's recently released financial forecastpredicts a $27 million budget gap for the budget year that begins July 1. This gap is primarily due to lower-than-expected property tax revenues, inflationary pressures and rising healthcare costs. As a result, City leaders are planning for spending cuts across most bureaus, targeting reductions of 8 percent; cuts necessary to stabilize the City's finances and avoid further strain on the budget.

As the City continues to negotiate labor contracts, the impact of these negotiations on the budget is a key consideration with additional financial commitments requiring deeper cuts to City programs and services.

AFSCME Bargaining Update

Mediation is underway with the American Federation of State, County and Municipal Employees (AFSCME), which represents approximately 1,000 City across each of the City's six service areas. Mediation sessions were held Dec. 12 and 17.

AFSCME is one of three bargaining units in active negotiations with the City of Portland, which faces a budget shortfall for the upcoming fiscal year because revenues are not keeping up with expenses.

The City and AFSCME have been meeting since May and have reached tentative agreements on a range of non-economic topics, including seniority, holidays, leaves of absence and grievance procedures.

The remaining focus is on economic proposals. On Dec. 18, the City presented a proposal that includes more than $15 million in new spending over the next three years. Key elements include:

• 2% longevity pay at 10 years of service
• A total of 2% across-the-board increases for eligible positions over two years
• Targeted wage increases for 30 job classifications
• Additional personal holidays for in-person positions
• Opportunities to cash out up to 40 hours of unused vacation time annually
• Increased shift premiums and clothing allowances
• Expansion of the bargaining unit to include Limited Duration positions
• Employee leave protections during power outages
• Increased break time for Parking Enforcement Agents
• A Voluntary Employee Beneficiary Association for AFSCME members beginning in 2026
• Trauma-informed training for employees
• A provision for two City employees to take full-time leave for union work

On Dec. 20, AFSCME presented a counter proposal. The next mediation session is scheduled for Jan. 14.

View the City of Portland's Dec. 18, 2024 proposal

View AFSCME's Dec. 20, 2024 proposal

Portland City Council also recently authorizedthe City Attorney's Office to file an "unfair labor practice" complaint with the Oregon Employment Relations Board, alleging contract violations when AFSCME held two "practice pickets" this fall.

The City's bargaining is anchored by five guiding principles:

• Respect: Honor employees' service and expertise by providing fair compensation, benefits and working conditions.
• Workforce competition: Attract and retain a talented, diverse workforce.
• Financial stewardship: Make the most of taxpayers' resources to make Portland safe, healthy and livable.
• Shared responsibility: Ensure that all employees share equitably in the impacts of economic factors outside the City's control.
• Rules and regulations: Follow laws and best practices for labor negotiations.

Download PDF fileDec. 20, 2024 AFSCME proposal to City of Portland545.05 KB