The Vallejo Police Officers Association approved the modified agreement over the weekend, association vice president Mat Mustard said.
The agreement extends the contract with the police union by two years through June 30, 2012, said Joann West, Vallejo's public information officer.
Salary reductions exceeding 18 percent that were agreed to by the police union will save the city $6 million between July 1, 2008 and June 30, 2010, West said.
"Additional long-term savings will be achieved through caps on medical benefits for current employees and retirees and reductions in sick leave and annual leave benefits for new employees," West said in a news release.
The modified agreement eliminates minimum staffing levels in the Police Department, allowing the city to modify staffing and service levels as needed over the term of the agreement, West said.
"This agreement represents a very positive deal for the city and residents of Vallejo," Police Chief Robert Nichelini said in a statement.
"It will allow the department to manage staffing and service levels while maintaining wages and benefits at a level necessary to recruit and retain officers in a very tight police labor market," Nichelini said.
As a result of the agreement, Vallejo will withdraw its motion to reject the Police Department's existing, unmodified collective bargaining agreement and the police union will withdraw its challenge to the city's eligibility for Chapter 9 bankruptcy.
A hearing in bankruptcy court in Sacramento is scheduled for Feb. 3 on the city's bid to the reject collective bargaining agreements with the firefighters union, electrical workers and administrative, managerial and professional employees association.
Vallejo officials said one reason the city filed for bankruptcy is because public safety expenses comprised 75 percent of its general fund budget.
A negotiating session with the firefighters union on its collective bargaining agreement is scheduled for today, West said, and the city is hopeful it can reach agreements with the three other unions.
Mayor Osby Davis said he voted to approve the agreement because "it is good for the community."
Councilwomen Stephanie Gomes and Joann Schivley voted against the agreement.
On her Web site, Gomes said, "I wish the VPOA would have agreed to this deal two years ago, even one year ago. As it stands now, though, it's simply not enough."
Gomes said she voted against the agreement because it does not require the police union to pay a portion of their health care premiums, police are guaranteed raises during the current recession and the city agreed to pay the union's attorney fees if the city can't meet the promises in the agreement.
Gomes also said she objects to the "piecemeal process."
"Until we know what the other employee groups will agree to, we should not be signing any agreement," she said.
Mustard said this morning the police union has made "huge sacrifices" and given money out of its members' pockets to the city.
"If when we're due a raise and if the city doesn't have the money, then we won't fight to prevent layoffs," Mustard said.
There were 147 members on the police force a year ago and there are now 115, Mustard said.
