City Finance Director Rob Dubow said he would review the award, along with the budgets just passed by City Council and the state, to determine their impact on Philadelphia's five-year plan.
Under the law that created PICA, the city must submit a budget to the agency that is balanced over five years.
Sam Katz, who chairs the PICA board, said the firefighters' ruling would prompt his organization to review whether current assumptions about the city budget are "reasonable," a decision that is "largely in the eye of the beholder."
He said the award, along with similar increases that arbitrators granted to the police in 2009, raises the question of whether the Nutter administration can continue to assume that it will not have to increase pay for the city's two other unions, AFSCME District Councils 33 and 47.
Both of those unions have been without a contract for three years. On Tuesday, Pete Matthews, who heads D.C. 33, said he believed the firefighters' decision strengthens the case for increasing his members' pay.
"The city has the money to fund the same contract for us," he said. "This helps us."
Bob Bedard, a spokesman for D.C. 47, said he did not think Monday's ruling would affect his union's negotiations because the Nutter administration has largely chosen not to bargain.
Dubow said the city's bargaining position is that it would pay for any wage increases for the two remaining unions with concessions.
In October 2010, the arbitration panel granted members of Local 22 of the International Association of Fire Fighters no raise in the first year of the contract and 3 percent hikes in each of the next three years. The Nutter administration appealed that award, arguing that the city could not afford it.
That appeal sent the dispute back to the original arbitration panel, which on Monday largely upheld the original decision.
The panel consisted of Jarin, Stuart Davidson, representing the union, and Michael Zobrak, the neutral arbitrator.
The city has 30 days to decide whether to appeal again. If it doesn't - or if the ruling is appealed to Common Pleas Court and upheld again - Philadelphia would have to come up with tens of millions in cash.
That's because the arbitrators' decision is retroactive to the first year of the contract, 2009, so the 2,100 firefighters and medics would get back pay. The decision also requires the city to pay about $20 million to the firefighters' health-care fund for benefits already paid, Jarin said, bringing the total amount of cash Philadelphia would have to raise in fiscal 2013 to about $66 million.
That's a big number for a city with a school system on the verge of bankruptcy, but Butkovitz said it amounts to less than 2 percent of the overall budget. He believes the city can generate the funds by not replacing employees who leave. He noted that the city had resumed small wage and business tax cuts - although it also raised property taxes for the third time in the most recent budget.
"If you have money for tax cuts, you have money for firefighters getting killed in the line of duty," Butkovitz said.
Contact staff writer Miriam Hill at 215-854-5520, hillmb@phillynews.com or @miriamhill on Twitter.
