Taxpayers cough up $14M in interest for city/firefighter lawsuit


by Adrianna Hopkins

Posted on November 2, 2009 at 11:05 PM

Updated Tuesday, Nov 3 at 1:00 AM

Over 800 city firefighters could be receiving a fat check just in time for Christmas next month.

The mayor is rolling out his plan to settle the long simmering fight with the firefighters over their overtime pay. The $45M settlement would be doled out in 3 payments over 8 months.

But one councilperson is calling the pay-out by taxpayers outrageous and he blames the city.

Years after 834 firefighters won a lawsuit demanding compensation for overtime pay, the city has finally agreed to a $45 million settlement.

Councilperson Kelly Downard says, that's great but, he says, had the city stopped filing appeal after appeal, taxpayers wouldn't have to cough up $14 million of that settlement amount in interest, not to mention attorneys fees.

"Me, I'm a little bit outraged by it. It's just too much. It's over the top. And as a taxpayer, you're sitting there thinking this is a lot of money, and we're paying it out. The courts have said it's owed, by law, we're paying to people who put their lives on the line," said Kelly Downard, Vice Chairman of the Metro Council Budget Finance Committee.

The Mayor's plan is to pay the $45M out in three payments:

$15.8 million in cash on Dec. 1st

$14.3 million in March 31, 2010 paid for by selling bonds

$14.9 million in July 15, 2010 paid for by selling bonds

Mayor Abramson said, "this plan ensures the firefighters receive the money due them while also ensuring it's done in a fiscally responsible way for the taxpayers."

"I think that is an outrageous statment when you figure that 1/3 of it is interest. How is that fiscally responsible?"

The Metro Council must OK the plan. Members like Downard will start looking over the proposal later this week.

But those 834 plaintiffs are coming out on top. Downard says some of them stand to get $100,000 before attorney fees and taxes.

"If the average [$45 million divided by 834 plaintiffs] is $50,000 and you give $10,000 to pay your attorneys and you pay your taxes, you end up with 50-60% of that amount and that's a lot of money to everyone in these days and age," said Downard.

So why not save the taxpayers $14 million and just settle this lawsuit years ago?

"It's a contentious position that the city has with the unions. And right or wrong this suit's been settle-able for a long time. It should have been," Downard said.

Again, the Metro Council has the final say and the final vote and they can change how the city will fund it.

Downard has questions: why isn't money from the rainy day fund being used in the pay out? We hope to hear more details from the Mayor Tuesday.