Politics & Government

Gov, Unions Remain at Odds as Layoff Notices Go Out

Both sides said Tuesday they were still hoping to reach an agreement over the $2 billion in union concessions called for under the governor's budget.

With the state and its various unions still at loggerheads over $2 billion in concessions needed to balance the upcoming budget, Gov. Dannel P. Malloy turned up the heat in the negotiations Tuesday by ordering that nearly 5,000 layoff notices be sent out.

Malloy said that his staff was still in negotiations with state unions, but that he was taking the steps necessary to implement his “Plan B” budget should those talks fall through. The $40.1 billion biennium budget for the coming two fiscal years, approved by the General Assembly last week, requires $1 billion in givebacks from unionized state employees already under contract each year, although no agreement on any of those concessions has been reached.

The plan Malloy outlined Tuesday in a statement would see the elimination of 4,742 state employees – a little more than 10 percent of the state’s 46,290 workers – as well as an additional $545 million in spending cuts and program reductions spread across the spectrum of state agencies. Malloy said those cuts would likely result in additional layoffs.

"We need to cut an additional $1 billion in spending in order to balance the budget in each year of the biennium, because I refuse to raise taxes beyond what has already been agreed to,” Malloy said in a release Tuesday. “We held off on any layoff notifications while we tried to complete a deal over the weekend and on Monday night. Unfortunately, absent an agreement and in order to comply with contractual notice requirements and the provisions of the budget agreement signed last week, we need to begin those notifications today.”

The governor’s staff said its preference was to notify each employee facing layoffs in person, which could take several weeks in total.

“These are just notifications,” said Gian-Carl Casa, under secretary for legislative affairs for the Office of Policy and Management, which functions, in part, as the governor’s budget agency. “It’s not telling people that they are going to lose their jobs, it’s telling them that if things don’t work out by July 1 they could.”

The budget adopted by the General Assembly last week included a May 31 deadline to achieve the needed $2 billion in savings, and any deal or alterations to that budget would need to be approved before the legislature’s adjournment June 8. The 2011-12 fiscal year begins July 1.

"I want to be clear that this is not the road I wanted to go down. I didn't want to lay people off, and I didn't want to make additional spending cuts beyond the $780 million in spending we've already cut,” Malloy said. "But I have no choice. I promised the people of Connecticut that I would change the way we do business in Hartford. I promised to deliver a budget that is balanced with no gimmicks, and I will. My preference is to do that by asking everyone to share in the sacrifice, including my fellow state employees.”

Matt O’Connor, a spokesman for the State Employees Bargaining Agent Coalition, which represents more than 45,000 of the state’s unionized employees, said the unions were continuing to negotiate with Malloy despite the layoff notices and remained committed to reaching a “mutual agreement” with the governor.

“We certainly have approached this with every expectation that we can be part of the solution, that we can deliver cost savings,” O’Connor said. “We’re not giving up on the process. We’re staying committed, we’re staying focused.

Although O’Connor declined to discuss the specifics of the current negotiations, citing an agreement with the governor’s staff not to do so publicly, he did say that some of the potential options on the table to arrive at savings have been previously mentioned publically by Malloy, such as restructuring state workers’ health care plans, reducing reliance on outside contactors and consultants, and delaying the state’s retirement age. O’Connor said the negotiations were focused on “ways to save money and improve the delivery of public services” and to “eliminate redundancies in state government.”

Already unpopular with many throughout the state, Malloy’s biennium budget, which includes total spending of $19.8 billion for the 2011-12 fiscal year, and $20.3 billion for the 2012-13 fiscal year, plugs an estimated $3.5 billion deficit through spending cuts and tax and revenue increases. Without the union concessions, an additional $1 billion in savings each year would have to be found within the budget.

In a May 6 letter to the governor, OPM Secretary Benjamin Barnes outlined ways that the state could save $1.2 billion in cuts and program reductions, although Malloy’s Tuesday letter only called for $545 million worth of spending cuts to state government, coupled with the $455 million in savings that would be realized through the layoffs.

Colleen Flanagan, a spokeswoman for the governor, said Tuesday that “everything is on the table” in the current negotiations. She could not specify which of Barnes recommendations the governor might ultimately adopt if concessions could not be reached.

The cuts called for under Barnes reduction plan include a 10 percent reduction to the budgets of most state agencies, including the state’s public university system and the University of Connecticut, the closing of a prison and branch offices of the Department of Motor Vehicles, and the elimination of temporary and per diem employees.

Staff cuts outlined in Barnes recommendation vary across state agencies. The state Department of Education takes by far the biggest hit, losing 1,413, or 83 percent, of its 1,706 contacted employees, mostly in the state’s various vocational schools. The full outline of Barnes recommendations is in a PDF file attached to the article here.

Much has also been made publically that $2 billion in savings divided by about 46,000 state employees works out to roughly $20,000 in savings per employee, but O’Connor and Casa said that the figures quoted in the press have been largely misleading.

Without mentioning specifics of the negotiations, because he said he was not taking part in them, Casa said Malloy outlined in his initial budget address Feb. 16 that he hoped to achieve the savings through an increase in the state’s retirement age, a wage freeze, and restructuring the health benefit packages of state employees so that it matched federal employees.

“There are ways for the state to save money that don’t equal $20,000 coming out of everyone’s pocket,” Casa said.

Whatever happens in the next few weeks, it seems that almost everyone in Connecticut will be closely watching the negotiations for an indication of just what to expect when the fiscal year begins July 1.

Tuesday night during a Tolland Town Council meeting members and the town manager quipped that implementation of Malloy’s “Plan B” budget could affect how the town approaches paving projects this spring and summer, among other programs and services.

Scott Shanley, Manchester’s town manager, said that under the cuts and reductions called for under Malloy’s “Plan B” budget Manchester stood to lose up to $6 million in state funding in an already tight budget year.

“Plan B just makes operations even harder,” Shanley said.


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