“Going forward, I think the city will be able to handle it,” Gray said, “but the question is, how is the city going to pay for the retroactivity when it calculates those figures?”

For more than two years, officials have speculated about how a new police contract would impact the cash-strapped city. They acknowledged that the award includes some savings, but Council President Scott Mandel said, “Unfortunately, the previous administration’s rampant fiscal mismanagement and many years of failure to negotiate with the PBA left us with a difficult and costly situation. While our cops on the street continue to do a great job, we are disappointed by the arbitrator’s decision based on the fiscal challenges our city and residents are facing.”

The award includes a 3.75 percent increase for the first three years, a 3.5 increase for 2011 and 2 percent raises for each of three following years, as well an additional longevity increase based on years of service.

Some of those percentages are deferred until July 2014, Gray explained. The award includes what city officials described as an “unprecedentedly” low 1 percent semi-annual increase for the contract’s final three years, saving the city approximately $368,000.

“They’re getting half of their raises at the beginning of the fiscal year and the other at the six-month mark,” Gray said. “For cash-flow purposes, it’s a benefit to the city.”

Apple said that he could not estimate an average salary increase. “It’s hard to say, because it depends on what step salary you are,” he said. “[The arbitrator] felt that the prior administration had the ability to pay us, and factored in the city’s current financial situation as the award progressed. The city has a bunch of savings in the award and there were several concessions, including payment assistance in deferments and lag payroll.”