Some high-earning state employees would likely get little or no pay raise next year — a move that the Shumlin administration proposed this week to obtain $2 million in personnel savings. The move would affect nonunion appointed employees, especially those making more than $100,000.
That was a sign of progress in the governor's search for $10.8 million in personnel savings to balance next year's budget. But as for the other $8.8 million?
The administration made a new push Thursday, asking the state employees’ union to agree to furloughs, wage freezes and other changes.
Keep looking elsewhere, said Steve Howard, executive director of the Vermont State Employees' Association. “We’ve been very, very clear. We’re not opening the contract," he said. "I don’t know how many more times we can say it. The support is just not there.”
In discussions Thursday with the VSEA, Administration Secretary Justin Johnson laid out the $2 million he can cut from nonunion — or “exempt” — personnel. Pay raises for exempt employees would be limited, mileage reimbursement rates cut in half and vacant positions would not be filled.
“That’s encouraging,” said Howard, who's been negotiating with the administration over cuts Gov. Peter Shumlin proposed in January.
But on Thursday afternoon, Johnson sent the union a memo listing options for finding the remaining $8.8 million. Among the suggestions were five unpaid furlough days, a six-month delay in a scheduled 2.5 percent cost-of-living salary increase and a 50 percent reduction in mileage reimbursement rates for employees who don't use state vehicles, if they are available.
Howard called the proposal an unwelcome surprise. “I thought we were making progress,” he said. “Yesterday’s memo wasn’t helpful.”
The union has made a series of suggestions, Howard said, which have included reducing “massive growth” in the number of exempt employees, temporary employees and contracted workers. “We think there are opportunities to find savings there,” Howard said.
Johnson said the governor believes the bulk of state employees have to be part of the savings too. “The challenge at this point is the union is pretty comfortable at telling me things I can do to nonunion members,” Johnson said.
Johnson said cutting contract workers sounds good at first blush, but the increase in contracts came largely because of rebuilding from Tropical Storm Irene. The $94 million state office building project in Waterbury can’t be completed with existing state employees, he said, but also can’t be halted just to balance the budget this year.
The union also proposed offering retirement incentives, which it estimates would save $3 million. Johnson said he has yet to figure out whether that would save any money. Savings in salaries could be offset by a hit to the retirement fund, he said. “We’re still looking at it,” Johnson said. “I’m hopeful we can get some savings from that.”
Saturday, the union plans a Fight Back Rally outside the Statehouse. The union and administration plan to continue their talks next week.