An unanticipated expense in the arbitrated four-year contract awarded the police officers union will cost Oahu taxpayers about 36 percent more than city officials had originally anticipated.
The total package issued to the State of Hawaii Organization of Police Officers by arbitrator Thomas Angelo is worth about $200 million over four years.
Wage increases, as Mayor Kirk Caldwell announced last week, amount to about 16.8 percent at the end of four years. That accounts for about $121.5 million of the package, according to a letter Caldwell sent to City Council members this week.
However, the city will also be paying the Honolulu Police Department’s roughly 2,000 officers about $43.4 million for what’s known as a standard of conduct differential.
For more than a decade, officers have been receiving $1 for every hour that they work, essentially as compensation for being required by HPD policy to adhere to its standard of conduct 24 hours a day.
That differential goes up to $2 an hour for most officers this fiscal year under the new contract, then climbs each year to a high of $3.80 an hour by July 1, 2016, Caldwell’s report said. Higher-ranking officers get $2.20 more this year, then $4 more an hour beginning in 2016, or four times what they now receive.
"For it to go up a dollar every year for four years was a little unexpected," city Deputy Budget Director Gary Kurokawa said Thursday night.
All officers except those suspended without pay are entitled to the standard of conduct differential, a source said.
Besides the pay increases, officers required to carry a firearm around the clock will also begin receiving a new firearm maintenance allowance of $500 annually. City officials say that provision will cost the city $165,680 more a year, or $662,720 over the four years.
Additionally, the contract calls for the city to pay $11.5 million this year, then $12.2 million in each of the next two years, as its contribution to the Employer-Union Health Benefits Trust Fund for SHOPO workers.
Adding that amount to the increases in wages and the conduct differential, as well as the new firearm maintenance allowance, puts the whole package at about $200 million.
According to Caldwell’s memo to the Council, catch-up and service step increases are also part of the package, although city officials could not say how much of the wage increases consisted of step movements.
Steps are tiers of pay based on years of service within a specified job description such as a patrol officer or detective. Employees typically move up a step on their hiring anniversary date.
Kurokawa said step increases for police officers are typical for all city employee contracts this year.
HPD recruits currently earn $51,240 a year, while the starting police officer makes $53,268 annually, not including fringe benefits such as nighttime pay, overtime and meal allowances for work during overtime, vehicle allowances and hazard pay.
The new agreement would push the annual base salary for recruits to $59,941 by 2017.
SHOPO and the four counties began negotiations for a new contract March 9, 2011. SHOPO President Tenari Ma’afala said last week that officers have been working without a contract since 2011.
The contract is one of the last to be reached for city workers. Still outstanding is a contract with the Hawaii Fire Fighters Association.
HFFA President Bobby Lee said this week he expected an arbitrated decision in the coming month.
Both Caldwell and Council members have been raising concerns about the raises and the need to find more revenue.
Kobayashi estimated that about $40 million has been set aside in the city’s $2 billion operating budget for raises in contract agreements with the Hawaii Government Employees Association, United Public Workers, SHOPO and HFFA.
To help pay for the increases in the coming years, the Council and administration have introduced 10 bills designed to make it easier for the Council to raise property tax rates for some property owners without burdening owner-occupants, Kobayashi said.
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Star-Advertiser reporter Sarah Zoellick contributed to this report.
