March 25, 2005

Debra Grabelle
Chief Negotiator
AFSCME, Local 3299, AFL-CIO
2201 Broadway, Suite 715
Oakland, CA 94612

RE: Laboratory's Revised Last, Best and Final Proposal, FY 2005 SX Local Wage Negotiations

Dear Debra:

On behalf of the Laboratory Bargaining Team, this revised last, best and final across the board wage offer is provided at the union's request to conclude these local negotiations.   The basic elements of this last, best and final offer with respect to a FY 2005 local wage agreement encompass the following:

1.  A 1.5% across-the-board wage adjustment to be paid to all eligible Laboratory employees in the SX unit retroactive to October 1, 2004, to be administered within (90) ninety days of contract ratification.   No separate paychecks will be issued.

2.  An additional amount of up to 0.25% will be available for posted promotions, individual equity adjustments and reclassifications.

3.  The parties agree to establish a Labor - Management team to explore pay for performance options that could be applicable to the Laboratory in the future.   The initial meeting will occur within 30 days of ratification of this agreement.

This revised last, best and final offer represents a fair and equitable wage proposal that contains significant modifications from the Laboratory's previous proposal of January 19, 2005.   Specifically, this proposal includes retroactive application of the 1.5% across the board wage adjustment to October 1, 2004 and includes a provision for individual market equity adjustment for employees in selected classifications.   I hope you will give this proposal your favorable consideration.

Please be advised that this offer is hereby extended until the close of business on Monday, March 28, 2005, at which time it will expire and be "off the table" in the event tentative agreement is not reached.

Respectfully yours,