At a time when high police and fire salaries in Vallejo have that city flirting with bankruptcy, Napa is bestowing 11 percent wage increases on its firefighters.

Firefighters will get raises of up to $10,000 per year, retroactive to July 1. The Napa City Council approved the agreement last week.

A new firefighter now earns $74,460, while a veteran brings in $93,564. A veteran firefighter/paramedic will receive $102,924.

The city is living up to its contract to pay firefighters the average of nine other Bay Area cities, said Assistant City Manager Nancy Weiss. “It’s what they were entitled to under the contract,” she said.

Josh Pero, president of the Napa City Firefighters Association, said the increase was as big as it was because his membership had not taken the raises they were due the past two years.

“We went two years without taking what we should have gotten,” Pero said. “The past two budget cycles the Napa City Firefighters Association has come to the table and helped the city with their budget problems.”

Because the city was facing hard times, his membership voted to cap its 2005 increase at 2 percent and its 2003 increase at 3 percent, Pero said.

Firefighters are now playing catch-up. The 11 percent raise brings Napa firefighters up to the average of nine comparable cities, including Vacaville, Santa Rosa, Fairfield, Hayward, Petaluma and Vallejo, Weiss said.

“A couple of agencies in our survey group had significant increases,” Weiss said. “Vallejo was one of those.”

Vallejo is in a financial crisis, with the Vallejo City Council announcing last week that it might have to file for bankruptcy to get out of its mountain of financial obligations to employees.

According to Vallejo officials, police and fire wages and benefits are eating up 80 percent of general fund revenues. The city could run of money in April. In addition, it has $135 million in unfunded retirement liability for current and retired employees.

City Manager Mike Parness said Napa’s financial picture is a far cry from Vallejo’s. Napa’s revenues are growing, not shrinking, and Napa’s contracts with police and fire are less generous, consuming less than 60 percent of the general fund, he said.

Napa has caps on retirement medical benefits that Vallejo does not have. Also, Napa’s police and fire contribute more money to the state-run retirement system, he said.

Like Vallejo, Napa firefighters contribute 9 percent of their pay to the Public Employees Retirement System, but they also pay another 2 percent, officials said.

Because of this extra 2 percent, Napa firefighters actually earn 2 percent less than the regional average, Pero said.

Vallejo’s situation is an extreme case of the financial strains that most California cities are facing, Parness said. Cities have lost control of their public safety retirement costs, he said. The state allows public safety employees to retire at age 50 with 3 percent pay for every year worked, he said.

A city that does not offer this benefit risks becoming unable to recruit and retain the best employees, Weiss said. “It’s really a statewide issue,” she said.

Napa needs to strike a balance between the needs of employees and the needs of residents for quality city services, Parness said. There are many areas where service levels could be improved if the city had the money, he said.

Solano County cities are generally in worse financial shape than Napa these days, Parness said. They depended more on housing development for revenues and have been hurt by the building downturn, he said.

In a report to council last week, Napa’s Finance Director Carole Wilson said city revenues from the hotel tax and interest on investments were running ahead of expectations.

Napa’s seven-year contract with firefighters expires June 30. Negotiations on a new contract are scheduled to begin next month.

Wages and benefits for Napa’s public safety employees consume nearly 60 percent of the city’s general fund, Parness said. This is close to the California average, he said.

Parness would prefer that Napa have flexibility as to whether it pays the average of surrounding cities. Survey information is helpful, but should it dictate what the city must pay? he asked.

Pero declined to comment on the upcoming negotiations or Vallejo’s situation. “I can’t tell you what our strategy and tactics will be,” he said. Negotiations are best done in private, he said.