Concessions deal seen as victory

HARTFORD — State union employees and government officials expressed joy and relief last week after the State Employee Bargaining Agent Coalition (SEBAC) announced it had ratified a concessions agreement with Gov. Dannel Malloy. The deal, seen as a victory both for state employees and the governor, will prevent widespread layoffs and save an estimated $1.6 billion to balance the state budget over the next two years.

A crowd of union employees held a televised press conference Aug. 18 to announce the agreement, with members taking turns speaking at a podium as fellow employees applauded and cheered.

“I am so proud to make this announcement today,” said Dawn Tyson, an administrative employee with the state Department of Social Services. “Union members have voted overwhelmingly to ratify the revised tentative agreement and this morning it was adopted by our SEBAC coalition... Our members have spoken decisively and overwhelmingly.”

Union employees voted 21,713 to 9,791 to ratify the tentative agreement, with 14 of 15 unions approving the deal. The decision nullifies a vote in June that rejected the agreement and resulted in SEBAC changing its bylaws to allow a simple majority to approve contractual changes.

Following the SEBAC press conference, Gov. Malloy held a press conference Thursday afternoon, Aug. 18, to declare victory and praise state employees for coming to an agreement.

“Ladies and gentlemen, this is an historic agreement,” he said. “It represents the most fundamental restructuring of the relationship between state government and state workers that has ever occurred in the state of Connecticut. It saves taxpayers $21.5 billion over the next 20 years, which is $6,100 for every man, woman and child in the state of Connecticut.”

Malloy noted that political opponents in Connecticut and across the country had predicted failure in his negotiations with state unions, but that union employees “stepped up to the plate” to get the deal done. “There were many people who said we could not reach an agreement that we achieved here this day,” the governor said. “They were wrong.”

With the tentative agreement ratified, the state can cease sending out layoff notices to state employees as part of Malloy’s Plan B budget, which would have required widespread layoffs and cuts to services. As of Aug. 19, layoff notices had gone out to nearly 3,100 state employees, according to Benjamin Barnes, secretary of the state Office of Policy and Management.

Where’s the $600 million?

Both Malloy and Barnes have said they feel absolutely confident that the announced $1.6 billion in savings in the two-year budget that began July 1 will be achieved, in spite of comments coming out of the nonpartisan state Office of Fiscal Analysis saying that the office could not confirm at least $600 million of the savings.

State Sen. Andrew Roraback (R-30) said Monday that he was happy to see the overall issue of the union agreement resolved, but that there are still questions to be answered.

“Like everyone else, I’m pleased that this package has passed,” he said. “The upside is that we’re going to avoid layoffs and pretty Draconian cuts to services. The potential downside is we’re not going to achieve all of the savings that are built into the agreement.”

In a press conference Aug. 19, House Minority Leader Lawrence Cafero (R-142) said he also believes at least $600 million of the proposed savings cannot be verified and that there may be even more work to do later this year to find cuts to balance the budget.

“Connecticut is growing a little weary of these so-called celebrations of the same budget, quote, victory,” Cafero said, noting that the governor has celebrated several budget milestones without having a finalized document. “I think from the public’s point of view, besides growing weary of the celebration,  I’m not sure their lot in life is any better with this agreement.”

Cafero noted that state residents are facing a $1.5 billion tax increase, dating retroactively to Jan. 1 and that they are still struggling. Still, he acknowledged that the news of a deal with the unions is positive in the short term, as it eliminates some of the uncertainty that has plagued the state’s fiscal outlook for the past several months.

“This is a great day for the governor politically because he believes that this issue finally, after almost eight months of getting the budget done the way he wanted it done, is done,’’ Cafero said. “I’m not so sure it’s a great day for the state of Connecticut, as much as, in his mind, it’s a great day for him politically.’’

Details of the deal

In his Aug. 19 press conference, Malloy said “there would have been hell to pay” in the coming years if the tentative agreement between SEBAC employees and his administration had not been ratified.

With more than 3,000 of the state’s 46,000 union employees on the chopping block, there would have been numerous facility closings and reductions in state services. Instead, union employees will now be guaranteed four years without layoffs in return for a two-year wage freeze and changes to their health care and pension benefits.

SEBAC employees agreed to an increased penalty for early retirees as part of the deal, along with mandatory contributions to a retirement and health-care trust fund and increased years of service required to receive retirement benefits.

For new employees, Malloy has created a new pension tier that reduces the amount of payments. Longevity payments, or bonuses for staying on the job for 10 years or more, are eliminated, and pension payments will be calculated based on the final five years of an employee’s service, rather than the highest three-year average. The number of years of service and age for retirement eligibility also increase under the agreement.

Malloy was asked last week if he plans to look for ways to eliminate redundancies in management, and he said he would continue to address the issue.

“I’ve made it very clear for the better part of two years that I believe Connecticut’s management has too many layers,” he said. “It needs to be flattened out, and I can assure you over time that process will continue.”

The governor said additional consolidations of state government are likely in the future.

The governor also said Connecticut has to face fiscal realities that are playing out across the nation. “I think we can reasonably predict that we’re in a slow-growth period of time in the United States and we can reasonably predict that that will continue,” he said.

State Police reject offer

The only one of the 15 SEBAC unions to reject the tentative concessions agreement was the Connecticut State Police Union, which announced Friday, Aug. 19, that its members had rejected the deal because of its inclusion of wage freezes.

The governor’s office responded by saying the union was effectively exposing its members to layoffs. Fifty-six layoffs from the newest class of state troopers went out six weeks ago and were expected to go into effect this week.

State troopers marched on the State Capitol Monday to protest the two-year salary freeze, noting that they had already agreed to a wage freeze in 2009 and were anticipating that agreement to conclude this year.

Connecticut State Police Union President Andrew Matthews said in televised interviews that state troopers work during off hours to ensure public safety and should not face zero wage increases. “We provide a service both on and off duty to the public and when you give the trooper a zero for a wage increase, in our view, that’s a lot more of a financial sacrifice to them and their families than it is to someone who works eight hours a day,” he said.

Matthews said the starting salary for new troopers is approximately $51,000 per year and that layoffs of 56 of them will bring the state’s total force down to 1,083. He noted that the state-mandated minimum number of state troopers is 1,248, a number that Malloy said was arbitrary.

“I’m sensitive to the troopers’ concerns,” the governor said in a statement. “But I have to manage the entire workforce, and given the massive budget problems I inherited, I believe asking all state employees to take a two-year wage freeze — in return for job security — is fair. "

The chart, linked below, shows specific information on changes to the health-care and pension plans for both existing and new state employees.