The D.C. government will have to pay $12.3 million more in police salaries and pensions over the next three years -- a 50 percent increase -- because of Mayor Marion Barry's decision this fall to renegotiate a multiyear contract that was signed a few months earlier, the mayor's budget director said yesterday.
Gladys W. Mack, assistant city administrator for budget and resource development, told a special meeting of the City Council that the new contract with 3,300 city policemen, announced last month, would cost a total of $36.48 million, compared to the $24.2-million price tag of the original package, signed in July.
The old contract would have given officers yearly bonuses of about $1,000 each for the first two years, with percentage raises beginning the third year. The new contract, effective Dec. 1, provides for percentage pay increases during all three years.
In announcing the new contract, Barry claimed that his decision to reopen contract talks under pressure from the International Brotherhood of Police Officers (IBPO) would require only $160,000 more plus other unspecified costs.
Yesterday, Mack specified those costs, saying that by significantly altering the way the increases in policemen's salaries were computed, the mayor's contract negotiators had added $12.3 million in "annualization costs."
The new contract calls for raises of 6 percent and 7 percent in the first two years, followed by an increase of between 7 and 9 percent in the third year, depending on the consumer price index, for a total increase over the life of the contract of between 20 and 22 percent.
The actual increase in salary, however, will far exceed those percentages. The salary increase for the first year will become part of the base salary against which the percentage increase for the second year is computed. Similarly, the third-year increase will be based on the expanded second-year salary. This snow-balling effect is the cause of the $12.3 million in annualization costs, according to Mack.
Although the City Council is expected to approve the contract today, some members have complained that the decision to reopen negotiations was little more than a costly political stunt to placate the union.
The IBPO, which is locked in a representation battle with the Federation of Police, endorsed Barry for election in 1978. Barry is expected to run for reelection next year.
"People keep saying what a great contract it is," said council member John A. Wilson (D-Ward 2), chairman of the Finance Committee and an announced candidate for mayor. "The question is, 'Great for whom?' "
Despite his reservations about the added cost, Wilson said he would vote for the new contract.
The city, which is about two-thirds of the way through negotiating new contracts with its employes, set aside $36.2 million in its current budget to cover increases in salaries and fringe benefits granted this year.
Mack said yesterday that those funds will not be sufficient to cover all the new contract settlements and that Barry will have to seek congressional approval for supplemental appropriations.
Under questioning, however, Mack acknowledged that Congress probably would not allocate new funds to cover D.C. employe salaries. "All of it will have to be found within the confines of local revenues," she said.
Council member Betty Ann Kane (D-At Large), another registered candidate for mayor, said yesterday that Barry had significantly understated the contract's costs by failing to take into account a legal requirement that increased salary costs be matched to a great extent by increased city payments into the pension fund.
"Putting the pension system on a sound financial footing was part of a deal negotiated with Congress to get the federal government to pay its fair share of pre-Home Rule costs," Kane said. "We cannot afford to play around wth our pension obligation."
Barry and his top aides contended that they were legally justified in reopening contract talks after learning that the contract technically violated a federal law governing the federal health insurance program in which the city participates.
The law limits to 75 percent the city contribution for health benefits, but the contract called for 80 percent. IBPO cited this apparent illegality in requesting new talks.
Judith W. Rogers, the District corporation counsel, agreed to a closed meeting with the council before it votes this morning to discuss legal implications of the new contract.
Rogers declined to testify publicly about the contract in any detail yesterday, saying she was afraid of jeopardizing the city's position in a case filed in D.C. Superior Court by policemen who are demanding that they receive bonuses as provided in the original contract.
"For me to argue the city's case here is not in the city's best interest," Rogers said.