REPORT TO THE CITY COUNCIL
FROM: SUMEET MALHI, Director
Personnel Services Department
BY: TONY GARCIA, Chief Labor Negotiator
Personnel Services Department
YER TAYLOR, Principal Labor Relations Analyst
Personnel Services Department
SUBJECT
Title
Actions pertaining to the International Union of Operating Engineers, Stationary Engineers, Local 39 for Unit 1
1. ***Adopt a Side Letter of Agreement between the City of Fresno and International Union of Operating Engineers, Stationary Engineers, Local 39 (Local 39), Non-Supervisory Blue Collar - Unit 1 (Subject to Mayor’s Veto)
2. ***RESOLUTION: Adopt the Eighth Amendment to FY 2026 Salary Resolution No. 2025-177, amending Exhibit 1, Unit 1 - Non-Supervisory Blue Collar (Local 39) and Exhibit 16, Benchmark of Deleted Job Classifications or Deleted Pay Step since 1/28/16, as required by the Side Letter of Agreement between the City of Fresno and International Union of Operating Engineers, Stationary Engineers, Local 39 (Local 39) (Subject to Mayor’s Veto)
3. ***RESOLUTION: Adopt the 18th Amendment to the FY 2026 Annual Appropriation Resolution No. 2025-179 to appropriate $4,255,900 for the negotiated Citywide Local 39 Classification and Compensation salary increase (Requires Five Affirmative Votes) (Subject to Mayor’s Veto)
Body
RECOMMENDATION
It is recommended Council (1) approve the attached Side Letter of Agreement between the City and Local 39 to implement wage adjustments for the respective classifications, revise titles for certain classifications, benchmark deleted classifications, include and modify the physical demands section, and memorialize the agreement on the terms and conditions of new or different certifications and/or licenses resulting from the finalization of the Classification and Compensation Study; (2) adopt the Eighth Amendment to FY 2026 Salary Resolution No. 2025-177 to amend Exhibits 1 and 16; and (3) adopt the 18th Amendment to the FY 2026 Annual Appropriation Resolution (AAR) No. 2025-179 to reappropriate the expenditures for FY 2026 from carryover and revenues in each respective fund.
EXECUTIVE SUMMARY
The City and Local 39 reached a tentative agreement on a Side Letter of Agreement resulting from a Classification and Compensation Study which implements wage adjustments for the respective classifications, revises titles for certain classifications, benchmarks deleted classifications, includes and modifies the physical demands section, and memorializes the agreement on the terms and conditions of new or different certifications and/or licenses. To implement the Side Letter of Agreement it is necessary to approve the Eighth Amendment to FY 2026 Salary Resolution No. 2025-177, amending Exhibit 1, Unit 1, Non-Supervisory Blue Collar (Local 39) and Exhibit 16, Benchmark of Deleted Job Classifications or Deleted Pay Step since 1/28/16, and adopt the 18th Amendment to the FY 2026 Annual Appropriation Resolution (AAR) No. 2025-179 to reappropriate the expenditures for FY 2026 from carryover and revenues in each respective fund.
BACKGROUND
In the January 2, 2023 - June 15, 2025 Memorandum of Understanding between the City of Fresno and Local 39, the City agreed to conduct a comprehensive classification and compensation study regarding classifications represented by Local 39 and to implement up to $2.9 million dollars in wage adjustments effective no later than December 30, 2024 based on the results identified by the classification and compensation study and mutually agreed upon and accepted by both parties.
The classification and compensation study was conducted by an outside consultant, Evergreen Solutions, LLC, starting in February 2024 and completing in April 2025. The City and Local 39 commenced negotiations on the results of the classification and compensation study in April 2025 and the parties reached a tentative agreement on October 3, 2025. The wages, terms, and conditions in the Side Letter of Agreement are retroactively effective December 30, 2024.
The City Attorney’s Office has approved the Side Letter of Agreement and the Salary Resolution Amendment as to form.
ENVIRONMENTAL FINDINGS
By the definition provided in the California Environmental Quality Act Guidelines Section 15378 this item does not qualify as a “project” and is therefore exempt from the California Environmental Quality Act requirements.
LOCAL PREFERENCE
Local preference is not implicated because this item does not involve public contracting or bidding with the City of Fresno.
FISCAL IMPACT
Approval of the Side Letter of Agreement, Salary Resolution Amendment, and Annual Appropriation Resolution will result in salary and benefit expenses of approximately $112,000 to the General Fund and $1,344,000 to All Funds in Fiscal Year 2025, and $177,600 to the General Fund and $2,911,900 to All Funds in Fiscal Year 2026, for a total of $289,600 to the General Fund and $4,255,900 to All Funds. The General Fund portion was appropriated in FY 2025. Approval of this item will reappropriate the expenditures for FY 2026 from carryover and revenues in each respective fund.
Attachments:
Side Letter of Agreement between the City of Fresno and Local 39
Resolution - Eighth Amendment to FY 2026 Salary Resolution No. 2025-177
Salary Table - Eighth Amendment to FY 2026 Salary Resolution No. 2025-177 - Redline
Salary Table - Eighth Amendment to FY 2026 Salary Resolution No. 2025-177 - Final
Resolution - 18th Amendment to the FY 2026 AAR