The $1.36 million in projected savings over the length of the contract will come from cuts to pension and retiree health care contributions as well as a wage freeze, said assistant city manager Marc Fox.
The city has a police budget of $19.7 million for the 2011-12 fiscal year after spending $20.1 million in 2010-11.
The police department accounts for roughly two-thirds of the city's general fund expenditures.
The 70-member Pittsburg Police Officers Association has ratified the deal, and the City Council will consider it at its meeting Monday, Fox said. The previous contract expired June 30.
"We appreciate that our police employees have stepped forward and made permanent reductions in their contracts," he said.
Under the agreement, officers will contribute 2 percent of their salaries to their pensions beginning in July 2012 and another 2 percent in July 2013.
Pittsburg now makes the entire 9 percent employee contribution to the California Public Employees Retirement System for police on top of the 27 percent of salary employer contribution.
The contract calls for no pay increases over the three years unless wages fall below the average of those offered by neighboring communities, Fox said.
"This would be an insurance policy for our officers in case our comparison cities don't make budget reductions," he said. "The city believes the possibility of this is remote."
The five-member police management union that represents one captain and four lieutenants, agreed to similar contract provisions, Fox said.
Officers hired on or after Oct. 2 will receive 5 percent less than the former entry-level wage and pay the entire 9 percent employee pension contribution, he said.
They will be entitled to 3 percent of their salaries at age 55 compared with 3 percent at 50 for current officers. They will receive maximum 2 percent cost-of-living increases during retirement versus the 3 percent for current workers.
"We have also reduced retiree health insurance benefits for new hires," Fox said. "We do plan to do some hiring."
Police Chief Aaron Baker is working slightly less than half time on an interim basis while receiving his pension, a practice allowed under CalPERS rules.
"The new city manager (Joe Sbranti) has a timetable for filling the chief's position," Fox said. "He wants to learn about his new job duties before making such a major change."
Contact Rick Radin at 925-779-7166.
