The Milton Board of Selectmen made the following announcement at the February 16, 2016 Board of Selectmen meeting:
Good evening. On behalf of the Board of Selectmen (the Board) I am going to read a detailed statement regarding the Board’s contract discussions with Police Chief Richard Wells.
The Chief’s contract is set to expire on June 30, 2016. He is in the third and final year of a program known as the Senior Managers Program or SMP, which has been in existence since the early 2000s and was collectively bargained with the Milton Police Superior Officers union. Eleven (11) members of the Milton Police Superior Officers union are eligible to participate in the SMP. In addition to Chief Wells, two (2) other senior employees – the Fire Chief and the Deputy Police Chief – are eligible for the benefit under their employment contracts. Under the SMP, a participant voluntarily gives up his/her accrued sick leave over a three-year period in exchange for an increase in pay over and above his/her regular cost of living increase over the same period of time. The plan has been advantageous to the Town because it has allowed the Town to better plan for retirements and successions and spread the buyback of sick leave over 3 years instead of 1 year.
Chief Wells sought to enter the SMP in June 2014. Based on the number of sick days that he was eligible to buy back, he would have received an additional 1.75% salary increase each year under the SMP. The Town Administrator met with the Board in executive session, and the Board, consisting of Mr. Keohane, Ms. Conlon and myself, voted unanimously to advance Chief Wells’ FY ’15 and FY ’16 sick days and waive another requirement of the SMP so that he could enter the program at a greater buyback rate of 2.25%. We had no obligation to do so. We did so to facilitate the Chief’s entry into the program with the expectation that he would retire on June 30, 2016. The Town Administrator clearly conveyed to Chief Wells that we would enforce the terms of the SMP, specifically, a provision stating that anyone staying in his existing position beyond the three-year period of the SMP is required to take a 10% pay cut. For fiscal years 2014, 2015 and 2016, other department heads and the Town Administrator received a 2% wage adjustment each year. Chief Wells received wage adjustments of 2.5% for FY ’14, 2.5% for FY ’15 and 2% for FY ’16, PLUS an additional 2.25% increase each year through the SMP’s sick leave buyback. Thus, Chief Wells’ total wage adjustments for the past 3 years were: 4.75% in FY ’14, 4.75% in FY ’15 and 4.25% this year.
In November 2014, the then Board of Selectmen – Mr. Keohane, Ms. Conlon and myself – voted unanimously to extend the term of Chief Wells’ employment contract for one year, to coincide with the expiration of his participation in the SMP on June 30, 2016. Chief Wells asked the Town Administrator for a two-year extension through June 30, 2017. The Town Administrator again advised Chief Wells that the Board would hold him to the SMP’s requirement that his salary be reduced by 10% if he wished to remain employed as Chief after June 30, 2016. The 10% reduction is intended to prevent employees from receiving a windfall by having their base salary artificially inflated without returning accrued sick days to the Town.
Beginning in August 2015, the Town Administrator and I met with Chief Wells to discuss his employment status. Chief Wells wanted to stay on as Chief after June 30, 2016, but he made clear to us that he objected to being paid a reduced salary. Chief Wells told the Town Administrator and me that he wanted to retire on August 17, 2017. He explained that he chose August 17 because it is the day his father retired as Milton’s Police Chief. The Board was willing to extend Chief Wells’ contract to August 17, 2017 but we would not waive the 10% salary reduction requirement. Too many other employees were eligible for the same benefit and could be expected to seek the same treatment. Chief Wells claimed for the first time the fact that the SMP is illegal because the additional compensation is not pensionable. The issue of whether SMP payments were pensionable was not discussed during negotiations for Chief Wells’ contract and it was not a factor in the Board’s decision to enter into that contract which included the SMP program benefit. That contract is silent on the issue. In fact, Ms. Fagan, who was the Town’s human resources officer before she became Town Administrator, advised Chief Wells to consult with his attorney before making a final decision about whether to enter the program.
We reached an impasse on the issue of the 10% salary reduction, which is why, on behalf of the Board and with advance notice to Chief Wells, I announced on November 17th that we would begin the process of selecting a new Police Chief to succeed Chief Wells on July 1, 2016. Succession planning is an important responsibility of the Board of Selectmen. Although we recognize Chief Wells’ strengths, Milton is fortunate to have a number of superior officers who are well-qualified to serve as Chief of Police.
As of June 30, 2016, the Town will have bought back all of Chief Wells’ sick time. If the Board were to make an exception for Chief Wells and waive the 10% salary reduction, this would set a terrible precedent for the 13 other similarly situated employees, which would adversely affect the Town’s budget. This Board does not intend to set such a bad precedent for future boards of selectmen and town administrators and we have communicated that to Chief Wells on numerous occasions.
We consulted Town Counsel and the Retirement Board’s counsel on whether the enhanced SMP payments are pensionable. Both of them concluded that, because of a change in the law several years ago, the SMP payments paid to Chief Wells are unlikely to be pensionable.
On December 22, 2015, the Board and its attorneys met with Chief Wells and his attorney to discuss the Chief’s salary and contract request in an effort to reach a mutually agreeable resolution. Chief Wells again informed us that he had known prior to 2014 that the enhanced payments under the SMP are not pensionable and that he did not intend to retire at the end of the SMP program. Chief Wells told us that his intent in entering the SMP was to increase his salary to the level at which he felt he should be compensated. The Chief asked for an extension until June 30, 2018. We discussed the possibility of withdrawing Chief Wells from the SMP retroactively.
The next day, Chief Wells’ attorney made a counter offer that involved, among other things, the Chief’s withdrawal from the SMP retroactively and the payment of additional compensation to make up for the lost SMP payments.
On December 30, the Board met to discuss the counter offer. The Board remained concerned with precedent and the integrity of contracts and the bargaining process. However, the Board has been open to negotiating an extension with Chief Wells. The SMP would provide a significant salary benefit to employees if the Board were to do exactly what Chief Wells initially asked us to do – waive the 10% reduction requirement. A decision by this Board to waive the 10% reduction requirement for the Chief and the 13 other eligible employees would have significant adverse consequences for the Town’s operating budget. Our fiduciary duty to the Town prevents us from taking that action. Therefore, we agreed that withdrawing Chief Wells from the SMP, retroactive to FY ’14, would be a viable alternative to enforcing the terms of the program.
On December 31, 2015, the Board made a counteroffer to the Chief that would have (1) removed the Chief from the SMP retroactive to June 30, 2014; (2) returned all of the Chief’s accumulated sick days to him; (3) required the Chief to pay back to the Town the additional salary he received for his sick days; (4) set the Chief’s FY ’16 salary at the amount he would have been paid but for his participation in the SMP; (5) given the Chief the same percentage salary increase in FY ’17 as other department heads will receive; and (6) extended the Chief’s contract through August 17, 2017. We gave the Chief and his attorney a deadline of January 8 to respond.
January 8th came and went without a response from the Chief or his attorney. On January 13th, our attorney followed up with Chief Wells’ attorney and told him that, if we did not receive a response by January 15, we would assume that our offer had been rejected and we would move forward with succession planning.
Chief Wells’ attorney responded later that day, rejecting our offer but also asking questions about some of the terms of the Board’s offer. He noted that “Chief Wells anticipates that he is better off finishing out his current contract and evaluating his options at that point”. On January 14, 2016, our attorney responded to the Chief’s attorney’s questions and reiterated the January 15th deadline. Our attorney made clear to the Chief’s attorney that evaluating his options in June would not be a realistic option for the Chief, as the Board would move forward quickly with the appointment of a screening committee to select the next Police Chief if an agreement could not be reached soon.
At the request of my two colleagues and out of respect for the many years of service that the Chief and his father gave to Milton, on January 20, 2016, Ms. Fagan and I met with Chief Wells to discuss the Board’s offer and encourage him to accept it. The Chief did not accept the Board’s offer, but requested a one year extension beyond the one year term at the Board’s option. I told him that the Board would consider that proposal.
On January 22, 2016 Chief Wells’ attorney submitted an entirely different counter offer which included a one year extension beyond the one year term at the Chief’s option and a different monetary package. On January 24, 2016 our attorney responded to the Chief’s attorney that the Board did not intend to reopen negotiations and that the Board’s offer was final.
Shortly thereafter, Chief Wells spent time in Israel for a police counter-terrorism training program that this Board approved. After he returned, on February 3, our attorney contacted Chief Wells’ attorney to give Chief Wells one last opportunity to accept one of the Board’s two offers. Our attorney reiterated the Board’s concern about setting bad precedent. He also provided Chief Wells’ attorney with an email that the Board received from the president of the Milton Police Superior Officers union, in which the union told us that, if we waive the 10% salary reduction for the Chief, the union will seek the same benefit for its 11 members who are eligible to participate in the SMP. Our attorney encouraged the Chief to strongly consider the Board’s two offers and let him know by Friday, February 5, at noon whether one of them is acceptable. Upon learning that the Chief’s attorney was out of the country until February 9, our attorney extended the deadline to accept one of our two offers to Friday, February 12, in writing to the Chief’s attorney. The Town Administrator separately confirmed that extension in writing to the Chief.
On February 12, the Chief’s attorney again rejected both of our offers and submitted a counteroffer. Like our proposal, Chief Wells’ counteroffer would remove him from the SMP and restore his sick days to him, which the Town would buy back upon his retirement. However, instead of restoring his FY ’16 salary to what it would have been had Chief Wells never entered the SMP, the counteroffer would give him a new 30-year 5% longevity step increase, which would be retroactive to FY ’14. We believe that the counteroffer would result in a windfall to Chief Wells, who already received a salary increase in FY ’14 and FY ’15 that was greater than what the Town Administrator and other department heads received and who would be paid a lump sum cash payment for his sick leave when he retires. Contrary to media reports that the Chief seeks no salary increase for FY ’17, the counteroffer would increase the Chief’s FY ’17 salary to $172,082.97. The counteroffer is unacceptable to the Board.
During the past three months, the Board of Selectmen has heard from residents who support Chief Wells and asked the Board to renew his contract at his current salary. Some residents submitted a petition that claimed that the Chief’s salary is not competitive with the salaries of police chiefs in Brookline, Canton, Hingham and Quincy. In fact, the Chief’s current salary under the SMP is greater than the salaries of the police chiefs in Canton and Hingham (both approximately $163,000). Chief Wells’ salary under our second proposal would only be slightly lower. We strongly disagree that the salaries paid to the police chiefs by the Town of Brookline ($218,000) and the City of Quincy ($176,000) – two communities with much larger populations than Milton’s and more non-residential areas – are at all relevant to Milton. Moreover, we cannot look solely to other communities in determining compensation for our employees. Our Town’s financial resources and the treatment of other department heads are also important factors. Chief Wells’ salary is greater than the salaries of the Town Administrator (to whom he reports), the Fire Chief and all other non-school department heads. The Board of Selectmen also heard from many Milton residents who urged us to hold Chief Wells to the terms of the contract he signed and the program that he voluntarily entered.
We believe that a compromise with Chief Wells could have and should have been reached and that it was in the best interests of Milton that the Board and Chief Wells settle this matter. We regret that an agreement has not been reached. All of us believe that removing Chief Wells from the SMP and restoring his FY ’16 salary to what it would have been but for his participation in the program was a reasonable offer. The Board has gone above and beyond what was required of us, first, when we accommodated the Chief’s entry into the SMP at a higher buyback rate than he was otherwise eligible for, and second, when we offered to remove him retroactively from a program that he voluntarily entered without any intention of complying with one of its key requirements. In the absence of a settlement, this Board has no alternative but to move forward with the appointment of a screening committee to select the next police chief.
The Board wishes to make two final points.
First, Town Administrator Annemarie Fagan negotiated with Chief Wells on behalf of the Board of Selectmen with respect to both his entry into the Senior Managers Program and his contract extension. Ms. Fagan has extensive experience in human resources and has negotiated many contracts with union and non-union employees. She has always negotiated in good faith, and she did so with Chief Wells. The Board of Selectmen fully supports the Town Administrator in this matter.
Second, some have alleged that our November statement that we would move ahead with succession planning for the Police Chief position was politically motivated. Nothing could be further from the truth, and such a suggestion is offensive to all three members of this Board. We’re volunteers. Like our many predecessors, we all ran for office because we love Milton and want to serve our Town and our fellow residents. The voters of Milton have given each of us something that is precious and that none of us takes lightly – trust. Our job is to do what is in the best interests of the Town of Milton. In this case, that includes considering the interests of not only Chief Wells but also of residents; the rank and file members of the Police Department; other employees who are parties to employment contracts or collectively-bargained union contracts; future boards of selectmen and future town administrators who will negotiate contracts with employees of the Town; and the taxpayers, who fund the majority of the Town’s operating budget. The Board’s dispute with Chief Wells is a contract dispute. It has been about money, precedent, and the integrity of the bargaining process and contracts, nothing more and nothing less.