Skip to main Content

Mayor Sullivan: AO 37 corrects a big mistake; vote yes on Prop. 1

  • Author: Dan Sullivan
  • Updated: June 29, 2016
  • Published October 31, 2014

In December 2008, then-Mayor Begich and a slim majority of the Anchorage Assembly made one of the worst business decisions in our city's history. In the middle of the worst recession in 70 years, as municipal revenues were rapidly declining, they rushed through the most expensive contracts in city history.

In 2013, in order to ensure that the taxpayers of our community never have to face the consequences of such irresponsible acts in the future, the Assembly passed AO 37, the Responsible Labor Act. AO 37 puts necessary restrictions on the costs of future labor contracts while also simplifying many areas that had grown far too complex for good management. I urge voters to vote yes on Proposition 1 on Nov. 4 to maintain this good public policy. AO 37 does the following:

Standardized benefit programs

There were more than 680 combinations of eligibility within the municipal benefit plans. Many large companies and public institutions offer outstanding benefit programs that include just a few appropriate options. AO 37 creates a simplified benefits program that gives the employees good choices and allows the administration to better manage the program. AO 37 also standardizes holidays, leave programs and overtime, creating more efficient workforce management.

Three-year contracts

The state of Alaska, by statute, limits labor contracts to three years. That is a provision of AO 37 and is good policy, as it allows both sides the flexibility to adjust contracts depending on current economic conditions. It also gives subsequent administrations an opportunity to participate in contract negotiations, which is one the top responsibilities of any administration.

Labor cost increases

The ordinance establishes the maximum that labor costs can increase annually by tying the increases to the previous five-year average of the Consumer Price Index, plus 1 percent. This average is a good gauge of where the local economy is and will help guarantee that public services will not have to be cut because the costs of labor are excessive.

Protecting public services

While public employee strikes are rare, residents should never have to worry about essential services being disrupted while labor and management are deliberating contracts. The ordinance provides that assurance.

Managed competition

Many cities, including Seattle, San Diego and Indianapolis, offer certain municipal services for competitive bid. The public sector employees as well as private entities can bid to perform the work. The public employees often win these bids because they know the work and, when put into a competitive environment, become very creative and resourceful regarding how to do the job better and more cost effectively. Public safety services including EMS are not eligible for competitive bid under this ordinance.

The ordinance also eliminates overly generous performance incentive programs where, in certain contracts, the incentives were great but the performance requirements minimal. AO 37 also restores management rights to schedule their employees.

Although the law is suspended pending the outcome of the Nov. 4 vote, we have negotiated seven of the city's nine labor contracts and virtually all of the provisions of AO 37 are contained in each. These contracts were negotiated by the union leadership and ratified by their members. AO 37 is working for Anchorage.

A recent commentary by former Anchorage police and fire chiefs put forth vague, unsubstantiated reasons why the public should undo AO 37, with the suggestion that the ordinance will somehow make our community less safe. Nothing could be further from the truth, and I am extremely disappointed that former public safety officials would resort to such tactics.

AO 37 guarantees that future labor contracts are consistent, easy to understand and to manage, and are fair to both the employees and the taxpayers who fund municipal government. On Nov. 4, I urge you to vote yes on Proposition 1.

Dan A. Sullivan is the mayor of Anchorage and Republican candidate for lieutenant governor.

The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at)

Local news matters.

Support independent, local journalism in Alaska.