The Costa Mesa city council Tuesday night will hold a second public hearing before approving a long-awaited labor deal with the city employees’ union, a two-year contract which will increase employee pension contributions and outsource street sweeping services.

The $24.7 million contract, which was ratified by the Costa Mesa City Employees Union in August, needs to be heard in two public hearings before the council can discuss the item and vote on it, according to the city’s Civic Openness in Negotiations ordinance, or COIN.

The agreement includes no salary changes for current employees, a 10 percent reduction in starting salaries for new hires, and a plan for employees to pay 60 percent of yearly retirement rate increases, eliminating $507,000 in annual pension costs. It reduces the total unused vacation and sick leave hours that employees can accrue and requires them to cash out those hours on an annual basis, and eliminates participation in the Retirement Health Savings Plan (RHS).

The deal also includes the outsourcing of street sweeping services. Employees that currently provide the service will be absorbed into the Public Services department.

This latest deal has come a long way since negotiations began last August, when the city proposed a 5 percent across-the-board pay cut, 5 percent increase in pension contributions, and major reductions to paid vacation and sick hours, an offer that union leaders called “draconian.”

The city’s relationship with its employees’ union has been fraught with tension and hostility since 2011, when a newly-elected majority moved to implement a vision for financial reform driven by cutting the cost of employee compensation, pensions and outsourcing 18 city services. The situation became especially heated in March of that year, when the city issued tentative pink slips to more than 200 employees, one of whom, 29-year-old Huy Pham, jumped to his death from the roof of city hall.

Tuesday’s regular public meeting begins at 6:00 pm. Read the full agenda here.

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