The Kenai Peninsula Borough administration and its employees’ union have reached a new collective bargaining agreement that will last until 2019.

The borough assembly approved the new agreement, which was originally reached April 7, at its Tuesday meeting. Both members of the administration and the employees’ association expressed satisfaction with the new agreement and the negotiation process.

The agreement makes a number of adjustments and changes to the last contract, which was finalized in 2013. Two major changes are the health care plan offering and reducing the percentage raises for borough employees over the three years of the contract.

Wages and health insurance benefits are always major negotiating points in the contract, though the negotiations included a number of adjustments that may seem minor to outsiders but are significant with those who have a stake in them, said Stormy Brown, the Kenai Peninsula Borough’s human resources manager and the lead negotiator for the borough administration.

“A lot of times, when you’re going over a contract, you see all the changes over the last three years where you need to clarify something for employees,” Brown said. “A lot of those changes may not have a lot of value on the street, but to employees, they mean a lot.”

The tentative agreement includes a different system for its health care plan offering. Instead of the traditional singular plan, the borough employees will now have a choice between a traditional plan and a high-deductible health plan, which has less expensive premiums but no limit on out-of-network costs to the insured person. The traditional plan is more expensive and has no reimbursable expenses, but it does place a cap on out-of-network, out-of-pocket costs.

Brown said the agreement was a cooperative one between the negotiating teams.

“We have a lot of healthcare costs challenging both the members as well as the borough,” Brown said. “We had to find some creative options to try to find some savings. That’s one of the ways we were able to agree to share in some of those costs and work toward savings.”

Employees will also receive smaller pay increases in than in the 2013 contract, with wages increasing 1 percent in the first full pay period of July 2016 and then .5 percent each following year. In the past, wages increased 2.5 percent each year or by the Anchorage Consumer Price Index increase, whichever is higher.

If the increase in the Anchorage Consumer Price Index is greater than 2.5 percent, employees would receive a $750 lump sum in 2017 and 2018, according to the tentative agreement.

The lump sum has been part of the contract before, Brown said. It ends up being less pay over time because it does not increase the base amount and therefore is not calculated into a percentage increase, she said.

Among the changes to the contract are a redefinition of nepotistic hiring considerations, expanding them to include parents-in-law and children-in law to the defintion of family; the elimination the requirement of having one employee representative for each department during contract negotiation; the removal of credit for temporary work toward seniority for employees hired after July 2016 and only applying toward those who have worked continuously in a department; adding the requirement that employees who have been laid off and return to temporary positions must be qualified for those roles before placement; and the clarification of the resignation process and the last-day-worked definition as well as delineating the resignation and retirement process from the termination process..

Brown said she thought the negotiations went well and everyone came to the table well informed, especially in light of the state’s economic climate.

“I think a lot of the changes were well though out, and it was a very well researched negotiation team with an understanding of what’s going on out there,” Brown said. “We just know that we’re going to have hard financial times in front of us … I didn’t take it lightly that people came with their pencils sharpened.”

At the borough assembly meeting Tuesday, Central Emergency Services Captain Terry Bookey and Kenai Peninsula Borough Office of Emergency Management Program Coordinator Dan Nelson testified in support of the new contract.

“The employees association worked diligently with the administration to come up with an agreement that we think from both sides addresses appropriately the fiscal climate which we’re in and also provides fairness to the employees of the Kenai Peninsula Borough,” Bookey said in testimony to the assembly.

Kenai Peninsula Borough Mayor Mike Navarre thanked the assembly for passing the contract, saying he appreciated the attitudes of the negotiating teams who took the state’s economic climate into consideration.

“The tone, I think, was set early in recognition of the economic climate that the state finds itself in that will manifest and already has in local budgets, and our budget reflects both the administration and the employees recognize that,” Navarre said. “This agreement is a good agreement and a fair agreement.”

Reach Elizabeth Earl at elizabeth.earl@peninsulaclarion.com.