Title
Successor Labor Agreements/Memoranda of Understanding; and the Citywide Salary Schedule [Two-Thirds Vote Required]
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FileID
File ID: 2026-00755
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Location
Location: Citywide
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Recommendation
Recommendation: Adopt a Resolution by two-thirds vote: 1) waiving the requirement for 10-day posting of labor agreements; 2) approving the Memorandum of Understanding (MOU) between the City of Sacramento (City) and Stationary Engineers, Local 39 Miscellaneous (L39A); 3) approving the MOU between the City and Stationary Engineers, Local 39 Plant Operators (L39B); 4) approving the MOU between the City and the Stationary Engineers, Local 39 General Supervisory (L39C); 5) approving the revised citywide salary schedule; 6) authorizing the City Manager to conduct the necessary budget adjustments and transfers from fund balances to adequately fund the MOUs; and 7) authorizing the City Manager or designee to make minor changes or adjustments to the exhibits in order to correct omissions and errors in the MOU and salary schedule.
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Contact
Contact: Aaron Donato, Labor Relations Manager, (916) 808-5816, adonato@cityofsacramento.org, Department of Human Resources
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Presenter
Presenter: None
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Attachments
Attachments:
1-Description/Analysis
2-L39A MOU (Redline)
3-L39B MOU (Redline)
4-L39C MOU (Redline)
5-Salary Schedule (Redline)
6-L39A Labor Agreement Costing
7-L39B Labor Agreement Costing
8-L39C Labor Agreement Costing
9-Resolution
10-Exhibit A - L39A MOU
11-Exhibit B - L39B MOU
12-Exhibit C - L39CA MOU
13-Exhibit D - Salary Schedule Final
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Description/Analysis
IssueDetail
Issue Detail:
Stationary Engineers, Local 39 Miscellaneous (L39A) Successor Labor Agreement/Memorandum of Understanding (MOU)
The 2023-2025 MOU between the City and L39A expired on September 19, 2025. The City and L39A have negotiated a successor MOU. Attachment 2 is a redline version of the successor MOU which includes the following major new contract terms:
• New term: September 20, 2025, through September 15, 2028.
• Effective September 20, 2025, salary ranges will be increased by one percent (1.0%).
• Within forty-five (45) calendar days, employees will receive a signing bonus of five hundred dollars ($500).
• Effective April 4, 2026, the following classifications will receive a seven percent (7%) equity increase:
• Integrated Waste Equipment Operator
• Senior Integrated Waste Equipment Operator
• Effective April 4, 2026, employees required to be on standby assignment for emergency work shall be paid forty-seven dollars ($47) per day while on standby.
• Effective September 19, 2026, salary ranges will be increased by two and one half percent (2.5%).
• Effective September 18, 2027, salary ranges will be increased by three percent (3.0%).
• Addition of Juneteenth (June 19) as a recognized holiday.
• Health and Welfare Contributions
• 2026 Calendar Year Health Changes, effective March 21, 2026:
§ Employee Only - City contribution of $1,051 per month,
§ Employee Plus One Dependent - City contribution of $1,674 per month, and
§ Employee Plus Two or More Dependents - City contribution of $2,230 per month.
• 2027 Calendar Year Health Changes, effective the first paycheck of 2027:
§ The City will contribute fifty percent (50%) of the first one hundred dollars ($100) of premium increases, up to a maximum contribution of fifty dollars ($50) per month, toward the cumulative total increase in premiums from plan year 2026 to plan year 2027.
• 2028 Calendar Year Health Changes, effective the first paycheck of 2028:
§ The City will contribute fifty percent (50%) of the first one hundred dollars ($100) of premium increases, up to a maximum contribution of fifty dollars ($50) per month, toward the cumulative total increase in premiums from plan year 2027 to plan year 2028.
• Longevity: Employees who have completed seventeen (17) years of service are eligible to receive longevity pay as follows:
• Effective September 19, 2026, one percent (1%) above their base rate of pay.
• Effective September 18, 2027, two percent (2%) above their base rate of pay, for a cumulative total of three percent (3%).
The final version of the L39A MOU is attached to the Resolution as Exhibit A (Attachment 10).
Stationary Engineers, Local 39 Plant Operators (L39B) Successor Labor Agreement/Memorandum of Understanding (MOU)
The 2023-2025 MOU between the City and L39B expired on December 26, 2025. The City and L39B have negotiated a successor MOU. Attachment 3 is a redline version of the successor MOU which includes the following major new contract terms:
• New term: December 27, 2025, through December 22, 2028.
• Effective December 27, 2025, salary ranges will be increased by one percent (1.0%).
• Within forty-five (45) calendar days, employees will receive a signing bonus of five hundred dollars ($500).
• Effective April 4, 2026, Relief Plant Operators who work swing shift will receive Night Shift Premium Pay of five percent (5%) of their base rate of pay for hours worked between 6 p.m. and 12 a.m.
• Effective April 4, 2026, Relief Plant Operators who work graveyard shift will receive Night Shift Premium Pay of seven percent (7%) of their base rate of pay for hours worked between 12 a.m. and 6 a.m.
• Effective December 26, 2026, salary ranges will be increased by two and one half percent (2.5%).
• Effective December 25, 2027, salary ranges will be increased by three percent (3.0%).
• Addition of Juneteenth (June 19) as a recognized holiday.
• Health and Welfare Contributions
• 2026 Calendar Year Health Changes, effective March 21, 2026:
§ Employee Only - City contribution of $1,051 per month,
§ Employee Plus One Dependent - City contribution of $1,674 per month, and
§ Employee Plus Two or More Dependents - City contribution of $2,230 per month.
• 2027 Calendar Year Health Changes, effective the first paycheck of 2027:
§ The City will contribute fifty percent (50%) of the first one hundred dollars ($100) of premium increases, up to a maximum contribution of fifty dollars ($50) per month, toward the cumulative total increase in premiums from plan year 2026 to plan year 2027.
• 2028 Calendar Year Health Changes, effective the first paycheck of 2028:
§ The City will contribute fifty percent (50%) of the first one hundred dollars ($100) of premium increases, up to a maximum contribution of fifty dollars ($50) per month, toward the cumulative total increase in premiums from plan year 2027 to plan year 2028.
• Longevity: Employees who have completed seventeen (17) years of service are eligible to receive longevity pay as follows:
• Effective December 26, 2026, one percent (1%) above their base rate of pay.
• Effective December 25, 2027, two percent (2%) above their base rate of pay, for a cumulative total of three percent (3%).
The final version of the L39B MOU is attached to the Resolution as Exhibit B (Attachment 11).
Stationary Engineers, Local 39 General Supervisory (L39C) Successor Labor Agreement/Memorandum of Understanding (MOU)
The 2023-2025 MOU between the City and L39C expired on September 19, 2025. The City and L39C have negotiated a successor MOU. Attachment 4 is a redline version of the successor MOU which includes the following major new contract terms:
• New term: September 20, 2025, through September 15, 2028.
• Effective September 20, 2025, salary ranges will be increased by one percent (1.0%).
• Within forty-five (45) calendar days, employees will receive a signing bonus of five hundred dollars ($500).
• Effective April 4, 2026, the classification of Integrated Waste Supervisor will receive a seven percent (7%) equity increase.
• Effective April 4, 2026, the classification of Supervising Dispatcher will receive a five percent (5%) equity increase.
• Effective April 4, 2026, employees required to be on standby assignment for emergency work shall be paid forty-seven dollars ($47) per day while on standby.
• Effective April 4, 2026, Supervising Plant Operators who work swing shift will receive Night Shift Premium Pay of five percent (5%) of their base rate of pay for hours worked between 6 p.m. and 12 a.m.
• Effective April 4, 2026, Supervising Plant Operators who work graveyard shift will receive Night Shift Premium Pay of seven percent (7%) of their base rate of pay for hours worked between 12 a.m. and 6 a.m.
• Effective September 19, 2026, salary ranges will be increased by two and one half percent (2.5%).
• Effective September 18, 2027, salary ranges will be increased by three percent (3.0%).
• Addition of Juneteenth (June 19) as a recognized holiday.
• Health and Welfare Contributions
• 2026 Calendar Year Health Changes, effective March 21, 2026:
§ Employee Only - City contribution of $1,051 per month,
§ Employee Plus One Dependent - City contribution of $1,674 per month, and
§ Employee Plus Two or More Dependents - City contribution of $2,230 per month.
• 2027 Calendar Year Health Changes, effective the first paycheck of 2027:
§ The City will contribute fifty percent (50%) of the first one hundred dollars ($100) of premium increases, up to a maximum contribution of fifty dollars ($50) per month, toward the cumulative total increase in premiums from plan year 2026 to plan year 2027.
• 2028 Calendar Year Health Changes, effective the first paycheck of 2028:
§ The City will contribute fifty percent (50%) of the first one hundred dollars ($100) of premium increases, up to a maximum contribution of fifty dollars ($50) per month, toward the cumulative total increase in premiums from plan year 2027 to plan year 2028.
• Longevity: Employees who have completed seventeen (17) years of service are eligible to receive longevity pay as follows:
• Effective September 19, 2026, one percent (1%) above their base rate of pay.
• Effective September 18, 2027, two percent (2%) above their base rate of pay, for a cumulative total of three percent (3%).
The final version of the L39C MOU is attached to the Resolution as Exhibit C (Attachment 12).
Salary Schedule
The California Code of Regulations requires that the City Council adopt the City’s Salary Schedule at a public meeting (2 CCR § 570.5). This obligation arises whenever salary ranges are changed to ensure that salary rates are transparent and publicly available. These publicly adopted rates are used by California Pubic Employees’ Retirement System (CalPERS) to determine the appropriate compensation earnable for each City employee when calculating their pension benefit.
A redline version of the salary schedule is shown in Attachment 5. The final, comprehensive Citywide salary schedule is attached to the Resolution as Exhibit E (Attachment 13).
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PolicyConsiderations
Policy Considerations: Approval of this action by the City Council is consistent with the City’s legal obligation under the Meyers-Milias-Brown Act, adheres to the City’s positive labor management relations concept, and provides labor stability.
The Sacramento City Code Section 4.04.020 and Council Rules and Procedure (Chapter 7, Section E.2.d) mandate that unless waived by a two-thirds vote of the City Council, all labor agreements, and all agreements greater than $1,000,000 shall be made available to the public at least ten (10) days prior to Council action. This provision will be waived by City Council.
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EconomicImpacts
Economic Impacts: None.
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EnvironmentalConsiderations
Environmental Considerations: The report contains administrative activities that will not have a significant effect on the environment and that do not constitute a “project” as defined by the California Environmental Quality Act (CEQA) Guidelines Sections 15061(b)(3) and 15378(b)(2).
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Sustainability
Sustainability: Not applicable.
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Commission/Committee Action
Commission/Committee Action: None.
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RationaleforRecommendation
Rationale for Recommendation: Approval of this action will establish new MOUs between the City and the specified Recognized Employee Organizations (REOs). Additionally, approval of this action will establish compliance with the California Code of Regulations § 570.5.
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FinancialConsiderations
Financial Considerations:
The total cost of the Local 39 MOUs for Fiscal Year (FY) 2025/26 is approximately $2.7 million with an ongoing annual cost at the end of the three year term of approximately $15.5 million, as shown below and detailed in Attachments 6, 7, and 8.
The General Fund portion is approximately $1.6 million in FY2025/26 with an ongoing cost of $9.1 million. The City's latest General Fund five-year forecast is in deficit. During the mid-year process, the forecast assumed $1.2 million in FY2025/26 and up to $6.4 million on an ongoing basis for Local 39 MOUs. The forecast including the final L39 MOUs costs is shown below.
The City will need to continue to implement spending reductions and/or revenue increases in order to balance the City budget in FY2026/27 and beyond, as required by the City Charter.
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LocalBusinessEnterprise
Local Business Enterprise (LBE): Not applicable.
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