Meadville, PA, Officials Ink Deal with Firefighters' Union

A new collective bargaining agreement for Meadville city firefighters will restore the traditional pensions previously lost in a contentious arbitration process nearly a decade ago.

Meadville City Council members on Tuesday voted unanimously to approve the three-year agreement with Local 515 of the International Association of Fire Fighters, the union that represents the firefighters of Meadville Central Fire Department.

In addition to restoring defined benefit pensions, the agreement sets wage increases for the next three years, eliminates all post-retirement health care benefits for union members retiring after Dec. 31, updates the residency requirement, and increases employee contributions to medical insurance costs from 12 percent to 13 percent.

In a phone interview Wednesday, City Manager Maryann Menanno said restoration of traditional pensions for firefighters made sense for the city. Meadville competes for labor with other paid departments in the region, she noted, pointing specifically to Millcreek Township in Erie County, where the department hired its first full-time firefighters late last year.

Millcreek Township Fire Department is in the process of adding 15 full-time firefighters and township supervisors last month approved a traditional pension plan for the department’s union members. Meadville Central is set to welcome three new firefighters next year. Both departments received million-dollar federal grants to fund the positions for three years.

“Retaining quality employees is a top priority,” Menanno said, “and reinstating the pension is a way to do that.”

The new contract also restores the pension benefit to its original level. Retirees will receive 55 percent of their annual wages following their retirement. The pension benefit had been reduced to 50 percent in 2013.

Firefighter Dan Serafin, president of Local 515, said the contract also made sense for the union’s 20 members, in large part due to the restoration of defined benefit pensions.

“We’re happy with it,” he said of the agreement Wednesday. “It’s definitely a huge recruitment and retention aspect. For us to lose it in 2016 and to gain it back is a huge step.”

The contract sets wage increases of 3 percent, 2.5 percent and 2 percent over the next three years. The updated residency requirement is similar to one included in the contract with the union that represents the city’s police officers, Menanno said. After beginning with the department, firefighters will have one year to establish residency within the city. They are then required to live within the city for three years, at which point the residency requirement is lifted. The new contract does away with a requirement that union members live within a 15-mile radius of the city.

Under the new agreement, a first-year firefighter will make a base salary of $46,677. For the third year of the contract, that figure will be up to $48,800.

Local 515 had staunchly opposed the switch from a traditional pension plan to a defined contribution plan when it was proposed by city leaders in 2015. Unable to find a compromise, the two sides went to arbitration, eventually waiting nearly two years for a decision. When it came in late 2017, the arbitration ruling was a clear victory for the city, eliminating traditional pensions for new union members and eliminating residency requirements for part-time employees.

At the time, city leaders framed the move to defined contribution plans as essential to the city’s financial stability since it would lower the city’s overall retirement obligation and make it more predictable.

Similar to a 401(k) plan, the defined contribution plan established for firefighters required the city to contribute 7 percent of an employee’s base salary while the employee contributed 5 percent. Once the employee retired, the city’s financial obligation ended.

In contrast, the city’s obligation under a traditional defined benefit pension continues until the death of both the employee or the employee’s spouse.

The conversion of the fire department union to defined contribution plans marked the completion of a years-long transition process that converted all of the city’s new employees from traditional pensions to defined contribution plans.

Under Menanno, however, that effort has been rolled back.

Beginning in 2023, police union members also returned to traditional pensions after having agreed to make the switch to defined contribution plans in 2015. As with the fire department, the switch was framed primarily as a recruitment and retention incentive. Members of the American Federation of State, County & Municipal Employees who work for the city have continued under defined contribution plans.

Menanno on Wednesday acknowledged that traditional pensions can be less predictable and that the switch would prove more costly for the city. Actuarial projections showed that the traditional plan would likely lead to annual higher expenses of $20,000 to $30,000 more than defined contribution plans, she said.

The contentious arbitration decision in 2017 was preceded by a 2016 City Council decision to eliminate several vacant firefighter positions in a cost-cutting move. For a time, the department was reduced to 10 full-time firefighters.

Today, the department has twice as many full-time staff members plus another five part-timers. It has added an ambulance service, a new lead engine, and has another used engine on the way to replace decades-old apparatus.

Menanno said a lot has changed since poor investment performance a decade ago led to changes and cuts.

“Right now, we’re getting solid returns and have been for a number of years,” she said.

In addition, some anticipated trends did not come to fruition.

“The thought process that was told to folks at the time was, ‘Everybody is going to be moving in this direction — getting rid of pensions, moving to this defined contribution,’” Menanno said. “That has in fact not turned out to be the case.”

Serafin, who was hired as a part-time firefighter in 2021, said he was unfamiliar with the process that led to the elimination of traditional pensions but characterized the most recent negotiations as “very smooth sailing.”

“City Council, the mayor and the city manager have all been very helpful toward us,” he said. “They knew what they needed to provide, especially with us getting the ambulance service into the city. It was a huge step forward for us as a department and a city to get that care to the residents. They stepped up.”

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