The deadlock continued yesterday in the labor talks between New York City and its unions, but efforts were being made to reach a settlement before Senate Banking Committee hearings on further federal aid for New York City get underway next Tuesday.
Municipal labor leaders late yesterday sent a telegram to Mayor Ed Koch urging an immediate resumption of the negotiations so a settlement might be reached before Koch testifies next week.
The labor negotiations collapsed late Thursday over a demand by the unions that the city pay some $200 million in wage increases that have been deferred since 1975, on top of a $1.1 billion two-year contract offer that the mayor had put forward.
The telegram from the union officials suggested that the $200 million deferral issue be submitted to arbitration "for the good of the city."
"We are strongly urging that we meet tonight and over the weekend so we can resolve and settle this contract - it's necessary in terms of Washington and Senator (William) Proxmire," union leader Victor Gotbaum announced.
Koch had earlier suggested that the issue of the deferral he removed from the contract talks, but the suggestion was rejected by union negotiators.
PICK UP paragraph four of old lede, beginning "Meanwhile a plan to sell $400 million . . ."
Meanwhile, a plan to sell $400 million in Municipal Assistance Corp. 30 day notes to the city's employee pension funds was indefintely postponed yesterday because of the negotiating impasse. The funds are needed to tide the city over through the end of June when it is hoped that Congress will pass new loan guarantee legislation to keep the city solvent.
The city expects to run out of funds by next Tuesday to pay for welfare and medicaid benefits if the MAC note sale does not go forward before then.
The lack of a labor settlement could make for some rough going when Koch and other city officials appear before Senate Banking Committee Chairman William Proxmire next Tuesday and Wednesday.
Proxmire, who has said he is opposed to extending further federal aid to New York City after the current $2.3 billion short-term loan program lapses on June 30, postponed earlier hearings because of the lack of a labor settlement, but then agreed to go ahead with the sessions beginning next week.
City hall soruces indictated that the existence of a Proxmire deadline for settling the labor contracts was in fact impairing the bargaining stance of the city since the unions knew that the city was under pressure to reach an agreement.
The impasse developed at the end of a marathon 25-hour neogtiating session over an issue that has only been on the periphery of the long-running contract talks.
Under the contracts negotiated in 1975 and set to expire on June 30, the unions agreed to defer $200 million in already promised pay increases until the end of June, provided the city had a balanced budget and was financially healthy enough to return to the bond markets. Neither of these conditions currently exists.
Koch contended that the city was therefore not obligated to pay the $200 million, but the union leaders wanted the mayor to extend the deadline.