State workers' pay may be cut - Budget: Republicans say they would support 2.5 percent reduction

BRAD SHANNON; Staff writer
The News Tribune


Political pressure is mounting on Washington employees to give up more pay to help Gov. Chris Gregoire close a $1.1 billion budget shortfall by June.

Republican Sen. Joe Zarelli of Ridgefield gave Gregoire a list of ideas to consider this week that included a 2.5 percent pay cut for state and university workers over the next six months.

This could save $46 million, according to Zarelli’s four-page list of budget cuts the minority Republicans would consider. If continued into the next budget, the pay cuts would save even more as the state comes to grips with a second shortfall of perhaps $5.7 billion for 2011-13.

“What we saw in Zarelli’s request, a lot of the items we saw, were consistent with what the governor has been asking for,” spokesman Glenn Kuper of the Office of Financial Management said Thursday.

As for payroll cuts, Kuper said: “Zarelli put a number out there. My response to that number is it seems like a reasonable estimate of what a compensation reduction request might look like.”

But whether that request to cut payroll costs includes furloughs, across-the-board pay reductions or other cuts, the labor negotiation team is not yet free to say publicly, according to Kuper. Negotiations have not begun on the short-term pay cut issue.

Facing a large budget gap with little time to to close it, Gregoire has offered several other possible cuts for lawmakers to consider. These include eliminating funding for the Basic Health Plan, the Disability Lifeline and all-day kindergarten; cutting mental-health programs, class-size enhancements for lower grades and financial aid to college students; and possibly borrowing revenue from July to spend in this budget cycle.

Republican Rep. Gary Alexander of Thurston County has suggested increases in employees’ health-care premiums, boosting workers’ 12 percent share to 14 percent for low-paid employees and up to 26 percent for more highly paid workers.

Democrats released a list of proposed cuts late Thursday; it can be viewed at

The Washington Federation of State Employees is resisting further pay cuts, furloughs and higher health-care costs for the roughly 40,000 government workers it represents. Federation spokesman Tim Welch said negotiations were held this week on the 2011-13 contracts, which Gregoire’s labor team is negotiating simultaneously with 25 unions.

But Welch questioned whether Gregoire had given the kind of formal notice needed to reopen contracts with unions for 2009-11. Gregoire issued a proclamation to reopen the contracts on Nov. 18, but Welch said no specific letter or notice went to unions.

“If we go back into negotiation, the law says we have to have mutual agreement on whatever we need to renegotiate. We have reopened the contract four times. I don’t know what more we have to cut. State employees have sacrificed,” Welch said. He cited the scuttling of pay raises in a contract for 2009-11, rising health-care costs and mandatory furloughs ordered by the Legislature.

Welch also declined to give specifics about what has been talked about at the table this week, citing agreements not to talk about details during negotiations. But he said further pay cuts are unwelcome after two years without cost of living adjustments and furloughs this year.

If minority Republicans or Gregoire want 2.5 percent pay cuts, he said, “What’s to keep it from being a 5 percent, across-the-board cut through furloughs? Do they not realize those pay cuts have already taken place at twice (the level) they are requesting now? … It’s not just COLAs but real loss of pay on top of increased costs for health care. We’ve already given our 2.5 percent and more already.”

Although health-care is not on the bargaining table for the remainder of the 2009-11 cycle, Gregoire has proposed that state employees pay 26 percent of premium costs for the 2011-13 term – up from 12 percent today. That offer assumes the state would continue to pay $850 per worker, on average, for a large number of insurance benefits including health, dental, life and disability.

The governor is not proposing that higher health-care premium to help with her supplemental budget deficit of $1.1 billion, because contracts with private insurers are already set for 2011, according to OFM director Marty Brown.

But Kuper said Alexander’s idea of a sliding scale for premiums “would be something we would look at” longer term.

“What the governor has said is her main concern is we don’t have the money to go above the $850 average per person. So we definitely are willing to look at creative ways to stay within that number,” Kuper said.

While union-state talks continue, so do talks between budget negotiators in the House and Senate, who were expected to meet today in person, according to the Governor’s Office.

Brad Shannon: 360-753-1688