Contract negotiations for every city labor union have begun simultaneously for the first time in recent memory, leaving a large variable in Evanston’s already contentious budget equation.

City Manager Roger Crum assumed a 2 percent annual raise in the four union contracts and a $561,000 hike in employee medical premiums when he crafted his balanced budget proposal this month. If the unions negotiate higher raises, the current $3.5 million deficit could expand.

City and union officials said they will do nothing to endanger Evanston’s financial welfare. But deviation from the 2 percent estimate would impact the deficit, Crum said.

“Every 1 percent in payroll adds a half million dollars (in expenses),” he said. “We have good employees, and we like to treat them well within the budget we have.”

Normally, only two or three contracts expire in a single year since each one covers a different span of time. It is only a coincidence that all four contracts expire at the end of February.

Judith Witt, the city’s human resources director, began meeting in December with representatives from every union — the International Association of Fire Fighters (IAFF); the Fraternal Order of Police Labor Council, representing sergeants; the Teamsters, representing officers; and the American Federation of State, County and Municipal Employees (AFSCME) .

“The city’s prepared to do whatever it takes to wrap up (negotiations) by Feb. 28,” she said.

Ray Summers, president of AFSCME Local 1891, said city workers should not be asked to make sacrifices unless the city proves it’s necessary. Since half of the AFSCME members also live in Evanston, they will negotiate with the city’s best interests in mind, he said.

“Many of us were born in the city of Evanston and are raising families in the city of Evanston,” he said. “We are their neighbors.”

More than 550 of the city’s 874 employees belong to unions. Another 300 city employees are trying to form a separate AFSCME union, but that will not affect negotiations this year.

If the city and the unions deadlock, the police and fire contracts would enter third-party arbitration. The AFSCME union could strike.

Steve Perrino, president of IAFF Local 742, said Crum’s proposed 2 percent salary increase is not acceptable, though he could not elaborate on negotiation details because he said he wanted to bargain in good faith.

A 2 percent increase would not be acceptable to the Fraternal Order of Police either, said its negotiator, Field Supervisor Barbara Kraft. She said the union aims to maintain a pay difference between sergeants and patrol officers.

“The city’s budget is not the union’s concern,” Kraft said. “The union’s concern is that we have wages for the sergeants we represent that are comparable to other communities.”

Mick Vendafreddo, the Teamsters representative, said the budget would play into negotiations only if the city brings it up.

“That’s their position to take, not ours,” he said.