Without union concessions, big consolidations yield small savings

July 12, 2011

By Keith M. Phaneuf

The challenge of reducing state government operating costs without wage and benefit concessions was underscored in a new, nonpartisan report showing a reduction of nearly 30 percent in the number of government agencies will save less than 1/20th of 1 percent of this year's overall budget.

In its initial summary of the $40.54 billion biennial budget approved last month, the nonpartisan Office of Fiscal Analysis reported projected savings of $9 million in this year's $20.14 billion budget, and $9.6 million in the $20.4 billion package approved for 2012-13.

Those savings stem from a net reduction of 23 departments and agencies, from 81 to 58. Technically, the new budget removed 28 entities via consolidation, but it also created five new ones, eliminating a net total of 68 positions in the process.

"These consolidations are not nearly what is needed to cut the cost of state government," said Sen. Robert Kane of Watertown, ranking GOP senator on the Appropriations Committee, who added that unless employee wage or benefit expenses are impacted, consolidations can't yield big savings.

"It's almost impossible to do that without affecting these areas," agreed Sen. Toni R. Harp, D-New Haven, co-chairwoman of the Appropriations Committee, who said she wasn't stunned to see an average savings of just $9.3 million per year from mergers cut state agency totals by 28 percent. "I think we knew the initial savings would be something consistent with those numbers."

One of the biggest consolidations involved the merger of nine watchdog agencies--covering ethics, elections enforcement, right-to-know laws, clean contracting, oversight of child welfare services and others--into the new Office of Governmental Accountability.

Other major changes ordered by legislature and Gov. Dannel P. Malloy merged the departments of Public Utility Control and Environmental Protection; put the Department of Information Technology and some functions of the Department of Public Works into the Department of Administrative Services; and meged the Connecticut State University System, the community colleges and Charter Oak State College.

Malloy originally planned to complement all consolidations with a two-year concession plan projected to save $1.6 billion across the biennium, but unions rejected it last month.

That plan would have ordered a two-year wage freeze, established a new worker wellness program and imposed new restrictions on retiree pension and health benefits. And administration officials said they believe the latter also would have encouraged about 1,000 senior state employees to retire by early September. Plans called for no more than 10 percent of those workers to be replaced, opening the door to $130 million in savings over the next two years.

Kane said the Democrat-controlled House of Representatives squandered a chance last month to save more by tabling a bill to curtail several collective bargaining rights in future state contracts, including phasing out longevity pay for senior workers and excluding overtime and longevity earnings from pension calculations.

But Harp said "I'm still hopeful the unions and the governor will have a meeting of the minds" and larger savings can be achieved through a concessions agreement.

The State Employees Bargaining Agent Coalition asked Malloy last week to reconvene discussions while its leaders investigate possible changes to SEBAC bylaws regarding contract modification votes.

Though 11 out of 15 coalition unions representing 57 percent of the workers backed the deal, it failed because bylaws require 14 out of 15 member unions representing at least 80 percent of all members to support any contract changes for successful ratification.

Malloy has said he won't renegotiate the deal, but also that he would talk with union leaders about better ways to clarify the agreement once they have a clear plan to reform the bylaws.

Meanwhile, the administration has been moving forward with plans to match the savings it hoped to achieve through concessions with a combination of layoffs and other spending cuts.

The governor's budget agency, the Office of Policy and Management, has assigned savings targets totaling $701 million for this year and $901 million for 2012-13 to more than 50 departments and offices. The administration also has recommended more than 6,600 layoffs and elimination of about 1,000 vacant posts to help meet those targets.

Malloy has said he's committed to balancing the budget with or without concessions, and his budget director, OPM Secretary Benjamin Barnes, said his office has just begun to review dozens of agency responses to the assigned savings targets.

Though  Malloy must report a final budget-balancing plan to the General Assembly by Friday and Barnes said he wouldn't be surprised if the legislature -- and the general public -- press the administration to reconsider cutbacks. "I'm sure there will be some instances where it will be a real challenge," he said. "Some of these reductions will be difficult to live with."

But Barnes also predicted that the administration also predicted that "there will be some real areas of savings (in operating costs) that we can sustain in future years."

Please login or register to post comments

Not a member of The Connecticut Mirror yet?

Be a part of The Connecticut Mirror community, comment on stories, receive e-mail news updates and more!

Comments

What a Mess. Blame it all on

What a Mess. Blame it all on the working person. This Governor just spends spends spends. They put in wage freeze and wellness program, where is the 3 percent give back and everything else. Just making the State employee look bad. The bylaws are the bylaws. I hope they dont change them. The last concessions passed. renegotiate but our Govenor wont. His way or the highway. that really helps.

It funny how they said if the

It funny how they said if the portion of the SEBAC agreement failed, then everything failed. They could have instituted the wage concessions for the units that voted yes, but they didn't want our money, they wanted our benefits all along. Our benefits was their goal, so the money didn't matter.
Asfcme is holding meetings this week and next week, I assume to try to sell us on a revote or some other dasterdly plan. Malloy won't renegotiate, only clarify, so what's the point.

Man proposes, but God

Man proposes, but God disposes. Malloy goes on a spending spree as if the resources at his disposal are unlimited, and then blames the state workers for the deficit. The sycophants that surround Malloy are not fazed. The banks will soon refuse to accept the checks drawn on the state treasury, because those accounts will be in red. Soon, red will be the true state color all around us.

Jackie u are dead on. I would

Jackie u are dead on. I would of took a wage freeze and a few furloughs. No thats not good enough. It would of saved money. After our bennies thats all they want.

lol... Toni Harp, "we knew

lol... Toni Harp, "we knew this wasn't a spit in the ocean, that's why we passed that sham budget that ya'll rejected"
"Don't you get it? The fix was in and you missed the sign..."
Just the fact that there are 80+ commissions and agencies doing who knows what all day tells you all you need to know.
It is beyond the capacity of the legislature and unfortunately this governor to step back and ask "what is the minimum that citizens really need the State to do for them?" and after that, "how can we change the cost of

Read More

To Jackie, There was

To Jackie,

There was absolutely nothing about this plan that would have interfered my my ability to pay a mortgage or a rent, but now thnaks to the no voters it is now a very real possibility that the public sector of my agency which is DDS will be gone over the next couple of years. This is all because people like mamie jane do not want to take their kids to the dentist 2 x a year?????, or is it really because of the changes to the pension system, which would have had

Read More

If Malloy was really

If Malloy was really interested in reducing State Employee spending and sharing the pain he would have included reducing his staff and that of legislators also. By reducing those employees that provide services to the public, he is taking away those services residents/voters/taxpayers. By looking at reducing these same employees making half the salary of his administrative staff, our Governor Malloy is attacking at the low end wage earners resulting in loss of services directly affecting residents. If our Governor really wanted to reduce waste and State payroll, he too would take a pay cut, reduction

Read More

A list of proposed staffing

A list of proposed staffing reductions by department--including gubernatorial and legislative staff--has been available online since July 1. The link is here.
Michael Regan
Editor

If cost savings and reduction

If cost savings and reduction in State employees was the goal of consolidating agencies then our Governor was way off target and now wants to blame State employees for his inadequacy on the State budget process. With consolidation, one would attempt to reduce redundant processes not create more layers levels of bureaucracy/management. Malloy should have looked into consolidating agencies such as all hazardous duty agencies with one department head and a deputy overseeing each of the consolidated departments. He could have consolidate State Police, DOC, DEP, Marshalls, and DMV into one department using one Human Relations Department,

Read More

Skyreacher, I think I've

Skyreacher, I think I've asked this before, but I will again...

Why is it that the "ONLY" alternative is to layoff 6500 people? Why is the Governor completely unwilling to renegotiate? Actually, can anyone of you "yes" voters answer that question? Here's the Wikipedia definition for the word "negotiation" (PLEASE, read it!!!)-

"Negotiation is a dialogue between two or more people or parties, intended to reach an understanding, resolve point of difference, or gain advantage in outcome of dialogue, to produce an agreement upon courses of action, to bargain for individual or collective advantage, to craft outcomes to

Read More

We have 9.1% unemployment in

We have 9.1% unemployment in CT currently according to the media this w/e. Laying off 6-7,000 employees would obviously increase this substantially. Releasing hundreds of Inmates by closing prisons now adds even more unemployed people in the State. Results of this will be: 1) The State will have to pay more unemployment compensation increasing the budget expense for that department. 2) Increasing crime rates, as one can already see the number of robberies and burglaries currently plaguing our State. This will affect insurance costs for all here in CT as claims increase so do our

Read More

"skyreacher" - Yes, yhou're

"skyreacher" - Yes, yhou're right it absolutely is terrible AND regrettable. And DDS will NOT be the only Dept. that may wind losing most of its already-dwindling public sector, I'm sure. I hope you don't get hit with a layoff.

"wigman" - The Governor is unwilling to re-negotiate because that SEBAC TA that didn't pass was the best combination of EVERYTHING that met the very complicated needs of BOTH sides (I really should say "ALL THREE SIDES" because the taxpaying general public is the third side). A significantly new "deal" that only focuses on one or two things will not

Read More

To Jackie and the others who

To Jackie and the others who think that wage freezes and furlough days should satisfy Malloy - you are forgetting that since the begining of all this, a huge chunk of savings that the Governor was looking for had to come from embedded, long term cuts in the budget. Rightly or wrongly, the point is that he would (and probably never will accept state employee cuts that don't include long term health and pension savings...I'm not suggesting that you have to like his proposals or vote for them but I am saying that it's not likely that he will

Read More

In my post above I should

In my post above I should have added that the news today on all of this is that the Malloy administrations has indicated to the Unions in discussions this morning that it would be willing to renegotiate parts of the SEBAC agreement in exchange for relevant revisions to the SEBAC bylaws...this comes from a reliable source...don't shoot the messenger her folks....it should come as no suprise that, rightly or wrongly, the Unions #1 concern is dues money. I had 40 years plus of one on one experience with this, both as a union member/rep then later as a manager.

Read More

Maybe I'm missing something

Maybe I'm missing something here, but I fail to see how the union concessions have anything to do with consolidations. The consolidations themselves would have saved the same (small) amount had the concession package passed.

As for the DDS issue, I think that agency and its budget are doomed regardless. I regret that I cannot recall where, but I read a comment from the new DDS commissioner indicating that the private non-profit providers were struggling and needed more clients/money to be sustained. Propping up PNP providers is not a reason to privatize. Hard, verifiable savings in

Read More

I have viewed the nancy

I have viewed the nancy wyman/union president video from wfsb3. I have to say that I felt a positive vibe from it. A positive vibe does not mean layoffs. A positive vibe does not mean ratification... "you cant please everybody". Plain and simple.

You can state your case on here but in the end, unions need to get the information out to their members for any future agreements... Union members should not rely on hear-say.

Ct Mirror has done a great job at reporting the news as it happens. It

Read More

"notasnobbystate..." I don't

"notasnobbystate..." I don't know about that video you referred to, but I think you're right on regarding ther unions' failure to adequately educate their membership, that these "blogs" are merely intended to get people discussing things and voicing their opinions, and that major decisions (like voting outcomes etc.) should be based on *facts* rather than opinions and people trying to "convince" every one else that *their* "opinion" is the "right" opinion. Having said that, let's face it - there's a REASON why people love to engage in debates and argumentation (and by "argumentation" I don't mean the common arguing that

Read More

"Bob in Glastonbury" - I

"Bob in Glastonbury" - I think your absolutely correct about how going back to a 35 hr workweek would go a long way to both help out the state regarding its immediate deficit(s) AND regarding its long term need to get pension costs under better control. Rowland was an IDIOT on that issue, that's for sure. But it DID raise employees' income.

And speaking of income, I have to disagree with you on the relative importance to our unions regarding avoiding layoffs to preserve union dues revenue. The situation's not like it was years ago, when employees' salaries were practically

Read More

state employees should do

state employees should do what it really means when private sector workers reject contracts:
STRIKE.
Guaranteed if part of the vote meant taking concessions, or going on strike, this would have passed, because at the end of the day there is a lot of hot air but no real guts to actual DO something other than complaining and throwing tantrums on these comment boards and/or anonymously creating a website about "voting no" and thinking thats some sort radical action.
you asked for it now take it, layoffs, double work, worse public services, privatization, and an employer who will remember this

Read More

going to a 35 hour work week

going to a 35 hour work week equals a 14% paycut

that is INSANE!

would u take an 14% cut in pay when

Malloy has money to give illegals instate tuition

he has 1 billion for new metro north cars

has $800 million for Uconn health Center

has increased his staffing by over 20%

has $800 million for a nine mile road

has a buget with a 4.5% increase

and today he gives cigna a 71 million dollar incentive package

what a slap in the face to all state workers who work hard and get no incentive package but to

Read More

CTsense??? We asked for

CTsense??? We asked for it??? Real interesting. Double work?? Real interesting???? No real guts???? Real interesting. Strike-We cant, NO STRIKE CLAUSE...Tantrums on comment boards?? Well, that is even more interesting. You just threw one. Do not wish misfortune on anyone as it will inhibit you....

Steve HC, I agree with your

Steve HC,

I agree with your comments 99% of the time. One issue I strongly disagree with you on is going back to 35 hours. For me, I have a job that is 40 hours. Cutting back to 35 hours equals a 12.5% pay cut. I don't think many people who work 40 hours now would take a permanent 12.5% cut in salaries. That is a ton of money over the 15 or so years left of my active State career and in my pension when I retire. Cutting 5 hours off people's pay who

Read More

To SteveHC - I would have to

To SteveHC - I would have to respectfully disagree with you relative to the importance of dues to the Unions. Unless things have changed considerably since July, 2009 when I retired, the unions were loathe to do anything to support individual members within their respective unions if it meant that that employee would be reclassified (read promoted) into another Union, or, God forbid, into management (MP). I'm speaking specifically of P4, P5, and to a lesser degree, clerical...FOr many years, I had responsibility for reorganization and expansion of our Department, creating new job descriptions, hiring a wide variety of

Read More

No one is entitled to state

No one is entitled to state job.
Bob from Glastonbury - You are retired. Your weekly Tier I weekly managers' pension income is greater than 90% of all state and private sector workers' weekly take home pay and you have the best gold plated, health care plan at little or no cost to you. Why should anyone still working, either state workers or taxpayers, listen to anything you say? All you care about is keeping your pension and health care funded with our contributions. Guess what pal, you are along for the ride and will get

Read More

"Bob ig Glastonbury" - When

"Bob ig Glastonbury" - When you say "try reclassifying a union job class into a management position..you can get approvals all the way up the line but try to get it through the Union. This happened dozens of times through the years" I know EXACTLY what you mean, because I had similar responsibilities. The problem with getting a job *CLASS* reclassified from a unionized class to a managerial (and thus NON-unionized) class - as opposed to getting an INDIVIDUAL EMPLOYEE reclassified - is that you're essentially expecting a UNION to approve the idea of *removing the collective bargaining rights* of

Read More

"richsobi" - I agree with you

"richsobi" - I agree with you 100% on the 35-hr workweek issue, I never said I was actually *in favor* of such a thing, I merely said to "Bob in Glastonbury" that I agreed with him that cutting back to 35 hrs/week would "ease" the State's pension-related concerns. In fact, I think the types of objections to it that you mentioned in your post above were *exactly* the reasons why SEBAC didn't go for such a thing.

Wow cigna is coming to

Wow cigna is coming to connecticut and its only going to cost us 50 million for 200 jobs. That should help our unemployment rate malloy has really shown himself to be what he is, an arrogant, self-serving bully with connecticut,s credit card that he won't have to pay, but will be coming back to the state employees in the future to pick up the tab with more concessions. He's out of control somebody needs to reel him in.

To TruthJustice - I am always

To TruthJustice - I am always up for an intelligent dialog but your toxic non-informed attitude precludes it...not worth my time, sorry "pal"

To SteveHC - reading your past comments on this and other columns led me to suspect you were well informed and experienced on the issues upon which you comment and your last response to my post confirmed my suspicions..Your thoughts are always well thought out and made smartly..As usual what you said has been consistent with my experience and the only piece where we disagree is the extent to which Unions place a priority on retaining dues

Read More

Bob in Glastonbury - All I

Bob in Glastonbury -

All I can say is "WOW!" Thank GOD I never encountered that kind of nonsense (and you know I'm just being polite here) regarding reclassifications... then again, I may not have been involved with the union(s) you had to deal with. I was involved mostly with 1199 (a GREAT union), then AFSCME (I won't say which local or bargaining unit, but my experiences with them were pretty good actually), and decades ago CSEA (under the old Master Contract) - not such a hot union (but UI was the absolute WORST). I can't even count how

Read More