Moving to contain Baltimore's worsening fiscal crisis, Mayor Kurt L. Schmoke said yesterday that he would void negotiated pay raises for municipal employees in an effort to reduce an anticipated $54.1 million budget shortfall.
The mayor described the wage freeze as a last-ditch effort to avoid laying off more than 2,000 city workers during a recession. But his move also risks a political fight with the unions representing the city's 27,600 municipal employees in an election year.
"To lose 2,009 employees at one time, which is what we would have to do to close the gap, would in my view be disruptive to services and to the quality of life in Baltimore City," the mayor said. "And so I've decided to take the course of freezing wages effective July 1."
The announcement, however, does not mean that city employees will go without the so-called step increases -- pay increases that employees receive based on tenure.
Reaction to Mr. Schmoke's announcement among the leader's of the 12 unions that represent municipal employees was mixed, but most seemed resigned, thinking that the city's fiscal plight left the mayor little alternative.
"I'm not happy with it, but I can't say we didn't expect it," said Irene B. Dandridge, president of the 6,000-member Baltimore Teachers Union, which is now negotiating with the city for a pay package to take effect July 1.
Others were angrier about losing benefits that had already been negotiated. "It's very obvious that if they have negotiated agreements and they are stating they are going to do anything different, that is not in good faith," said Jeffrey A. DeLisle, president of the Baltimore Firefighters Local 734.
For members in the 5,300-member City Union of Baltimore -- considered most typical because it has members in almost 500 classifications -- the freeze would cost the average worker $1,356 in lost wage increases that, under a contract approved last year by Mr. Schmoke's administration, had been scheduled to go into effect July 1.
Even with the freeze, which the mayor said would save the city $38 million, the city might still have to lay off as many as 600 people unless it receives additional state aid, officials said. The city's fiscal plight could be further complicated by a move in the City Council to rescind a tax on beverage containers, which would put the city an additional $6 million in the hole.
The freeze would rescind negotiated pay increases scheduled for July 1 for members of eight of the unions. The other four unions are now negotiating but, according to the mayor, now have no chance of getting pay increases.
It was unclear yesterday what, if anything, union leaders would do in response to the mayor's decision.
Leaders of the City Union of Baltimore seemed willing to accept the freeze if they could get assurances that they would be able to restore the lost increases when the city was in better fiscal shape.
"Our people will recapture the wage increase," said Cheryl Boykins Glenn, president of the union. "We believe the mayor is a person of integrity. He has not given us any reason to believe he will go back on his word."
Ms. Dandridge of the teachers union said that although she was resigned to going without a pay increase this time around, her union was trying to extract a commitment from the mayor to bring city teachers into parity soon with teachers in other Maryland systems.
Her union, which received an 8 percent increase in each of the past two years, is currently negotiating wage rates for the final year of its current three-year contract.
"He is saying there is no pay increase now, but we will negotiate for parity with the surrounding counties even if there is no amount attached to that," Ms. Dandridge said.
Mr. DeLisle, who represents the city's 1,400 firefighters, said he had not been briefed on the details of the mayor's decision but would resist any attempt to rescind the 6 percent pay increase his members were scheduled to receive.
The mayor said he could not give any assurances that the frozen pay increases ever would be restored, saying only, "What happens beyond fiscal year 1992 is still an issue for discussion."
The mayor and his legal advisers have said the city government is on firm legal ground in rescinding pay increases contained in contracts approved last year.
The law department cited a 1977 Maryland Court of Appeals case, in which the court ruled that the City Charter required the Board of Estimates to determine whether the city could afford to pay for items in thebudget.
The 1977 ruling came after the American Federation of State, County and Municipal Employees, a labor organization that currently represents 1.3 million employees nationwide, challenged a similar freeze under then-Mayor William Donald Schaefer, which voided scheduled step increases.
But other experts on municipal policy could not recall any other instances in which a city had rescinded a pay increase.
"Wherever it has been proposed, we usually have taken legal action," said Linda M. Lampkin, director of research for the national office of AFSCME.
She said ASFCME had success fully challenged other attempts to rescind wage increases through grievances before an arbitrator, unfair labor practice complaints or lawsuits. But she said such a challenge could be complicated by the fact that, unlike other states, Maryland does not have collective bargaining laws that provide for an administrative referee during disputes between municipalities and public worker unions.
She said the national office was concerned that Mr. Schmoke's action, if unchallenged, could undermine the ability of municipal unions to bargain with confidence.
"We really have a problem with sitting down and reaching a deal and now 10 months later they say they don't mean it," Ms. Lampkin said.