Quinn cuts "no-layoff" deal with union that endorsed him

Posted by Greg H. at 9/20/2010 11:02 AM CDT on Chicago Business

Just days after being endorsed by the state's largest employee union, the Quinn administration has reached a deal not to lay off any of the union's members or close any facilities in which they work until at least mid-2012.

Under a tentative pact that the state says it expects to sign later this week, some 50,000 state workers who are members of the American Federation of State, County and Municipal Employees would have their jobs protected until June 30, 2012 — a third of the way into the term of the next governor.

The GOP candidate for governor, Bill Brady, has vowed to slash state spending.

Before the no-layoffs clause takes effect, AFSCME will have to identify and accept at least $50 million in spending cuts. Those trims could come in the form of unpaid furlough days, less overtime and — potentially — partial deferral of 8.25% in salary hikes union members are scheduled to receive in the year beginning Jan. 1, 2% of it deferred from this year.
Both AFSCME and the state Budget Director David Vaught's spokeswoman said that makes the deal a good one for taxpayers.

But the annualized value of those 8.25% in salary hikes is at least $190 million according to the union —more than that, according to other sources. And outside fiscal watchdogs to whom I described the deal were harshly critical.

"To tie the next governor's hands now is untimely," said J. Thomas Johnson, head of the Taxpayers' Federation of Illinois. "There needs to be significant savings across state government. This (deal) doesn't seem to be enough."

"This seems like a very uneven bargain," said Laurence Msall, president of the Civic Federation. "While we haven't seen the details, we are very concerned."

Last year, the state reached a somewhat similar deal in which Gov. Pat Quinn backed away from threats to layoff AFSCME members in exchange for furlough days and other savings. He signed a pact agreeing to no layoffs until at least June 30, 2011.

But the pending deal may not reap the state as much in savings and, notably, extends much further into the term of the next governor, who the latest polls say will be Mr. Brady.

The deal was struck last Monday, Sept. 13 —two days after AFSCME announced it was endorsing Mr. Quinn, saying he "has made the case for adequate revenue to save jobs."

Henry Bayer, executive director of AFSCME's Illinois council, said that timing was "strictly coincidental." The union's endorsement session was scheduled long ago, he said, and the state and the union have been talking about ways to save money for "many months."

He also noted that the deal sets a goal of $100 million in savings, though only $50 million will be needed for the no-layoff clause to kick in.

"We feel that $100 million in savings is a good thing for us," Mr. Vaught's spokeswoman said.

The spokeswoman noted that another part of the deal — this part already signed — will yield $70 million in savings for employee health care.

But, in exchange for that, the state agreed not to seek to reopen the union's contract on health-insurance matters.

AFSCME's Mr. Bayer also argued that, whatever his harsh words, gubernatorial candidate Mr. Brady will not be able to layoff many state workers with, for instance, federal Medicaid rules blocking much action.

Mr. Brady's campaign declined to comment for this post.

Earlier this election year, Mr. Quinn caught heat for vetoing a bill to restructure McCormick Place. He insisted there was no connection between the fact that one of the convention center's top unions, the Teamsters, was a major campaign donor of his.

AFSCME had been quarrelling with Mr. Quinn over cuts in pensions for newly hired state workers, but its Sept. 13 press release endorsing him was unequivocal in its support.

"Quinn inherited a state ravaged by years of fiscal mismanagement and ethical compromise, and he's been working hard to get it back on track," it said. Mr. Brady "would take our state in the wrong direction."

The union casts a huge presence in state elections, regularly funnelling hundreds of workers and hundreds of thousands of dollars in campaign cash behind favored candidates.

* * * 3:10 update: Mr. Brady is out with a statement and, with a reference to "pay to play," it's pretty hard hitting:

"Unemployment is at double-digit levels and the state cannot pay its bills," the statement says. "The Quinn Administration should not agree to anything that limits Illinois' flexibility to manage this catastrophe."

The statement goes on to call on the governor to "avoid 11th hour election-year agreements that lock in more pay hikes and job security guarantees...in an arrangements that reminds voters of the pay-to-play politics that I seek to end."

Ouch!

http://www.chicagobusiness.com/section/blogs?blogID=greg-hinz&plckController=Blog&plckScript=blogScript&plckElementId=blogDest&plckBlogPage=BlogViewPost&plckPostId=Blog:1daca073-2eab-468e-9f19-ec177090a35cPost:37b3d0f4-3eed-4dd7-b431-a3a607c06784&sid=sitelife.chicagobusiness.com