An open letter to the Governor of Wisconsin
Dear Governor Walker,
Like many other state employees, I have spent significant time this morning reading and reviewing your email and related news items, and pondering its meaning for me and my coworkers. I realize that our state is having financial trouble, like every other government entity, many businesses, and many individual citizens during this difficult economic time, and that we all must make concessions and find ways to cope with the shortfalls. This is especially difficult when you are looking at such a large workforce with such complex budgetary issues.
However, I urge you to make sure that the policies outlined in your Budget Repair Bill are more nuanced than how they are outlined in this email. I fear that these policies would create undue financial hardship for many state employees, myself included, and may cause a rather large turnover rate or a significant decrease in morale and productivity in our workforce.
As an example, I will offer you my situation.
I currently work as an office operations associate. This classification offers me a base salary of $13.968 per hour or $29,053.44 per year as a base salary. I am also a single parent; this salary supports a household of two people. Currently, my salary and benefits package, even with furloughs that reduce my base salary to $28,255.49 ($29,053.44, minus $893.95 in furloughs plus $528 in unemployment compensation), is sufficient compensation to keep our household functioning independently of any aid or financial assistance, albeit in a rather frugal fashion. While I appreciate our excellent benefits and having enough sick time to be able to take off both when my son is sick and when I am sick, I would not call myself a “have.”
Your outlined proposal below would indicate that, in the future, I would be contributing a further $1,627 per year to my pension plan and approximately an additional $80 per month to my healthcare. While this is not a reduction in my base salary, it would involve a reduction of my take-home pay, currently at $1,838.33, by approximately $200 per month. I don’t know if you’ve ever had to feed, house, clothe, and educate two people on $1,600 per month, but it is extremely difficult and every penny matters to us.
More important to you, perhaps, than my individual situation is the fact that these cuts would not, I believe, actually be of any benefit financially to the state.
Firstly, I am 100% federally funded. The money for my salary and benefits comes from the federal Title I grant, and it is grant money that cannot be reappropriated to the state’s general fund. I know it’s a difficult situation when making policy to differentiate between state employees by funding source, but in this instance it would make some employees’ home lives excessively dire for no benefit to the state. I also see that this type of differentiation is something you are willing to undertake, as certain types of unions have been exempted from this bill, so I urge you to also look to where these changes will be appropriate and where they will create no benefit.
Secondly, the 9% drop in my overall compensation resulting in a significant reduction in my take-home pay would cause me to seek out assistance. My income currently falls below the threshold level for a family of two in the state FoodShare benefit program. While I have not used it thus far as I currently do not require it, $200 a month is about three-quarters of our monthly food budget, and the hardship that the loss of this sum would cause would necessitate help for my family. The state would end up picking up that tab - in addition to the money that is lost to the state in unemployment compensation on the days when I am furloughed (which, as stated above, my furlough days do not save the state general fund any money.)
Thirdly, money funneled to my pension and health insurance is not taxable income. This reduction in pay would put me, and many other state employees, in a lower tax bracket and will result in a loss of income for the state. Less disposable income for tens of thousands of citizens at once may also have a profound effect on local economies, the success of businesses, and revenues from sales taxes, which impact both the state government budget and the health of the state’s economy at large.
I urge you to consider, at the very least, a graded plan by base pay rate. 5.8% of your salary will not likely prevent you from eating, but for our family, it will. I would like to see the percentage of the contribution to pension, and perhaps to healthcare, be linked to the base pay rate, or at the absolute minimum, for people under a certain pay rate threshold to have the ability to opt out of the increased pension contribution and simply accept a smaller pension fund rather than a serious reduction in our disposable income. While I indeed took a state position partly because I knew that I would be saving appropriately for retirement, investments in my long-term future are not more important than my ability to feed and shelter my family in the immediate term. I am also facing being stripped of my ability to collectively bargain to make sure that I do not have to make the choice between securing my future, obtaining healthcare, and taking care of my family in the present.
I am certain it is not your intent to inflict such hardship on your employees, and it is hard to know the individual situations of the tens of thousands of people who will be affected. I thought it may help to inform your decisions if you knew at least one, and help you to make changes and additions to your policy that will help the state act frugally without imposing undue hardship onto those who keep it running each day.
Thank you for your time.
Mackenzie Dunn
Office Operations Associate, Title I and School Support Team
WI Department of Public Instruction
The text of the email sent to all state employees today:
Governor Scott Walker
State of Wisconsin
Thank you for your service to your state and your fellow citizens. I know that you have worked hard during this economic downturn to ensure that our citizens continue to receive great service, despite our state having fewer and fewer resources. I, like all Wisconsinites, am grateful for your professionalism and commitment to public service.
Like almost every state across the nation, our state faces some very serious and undeniable financial challenges. Over the last three months, I have worked diligently to review the status of our state finances and to put forward a plan that balances our budget now and will create stability in future budgets.
Many of you are aware of the immediate challenges facing our state. In the current fiscal year which ends on June 30, 2011, we face a budget deficit of $136.7 million. We also owe more than $200 million to the Injured Patients and Families Compensation Fund. Failure to immediately address this shortfall could result in the state being unable to pay for health services to thousands of children and families in Wisconsin’s BadgerCare program.
Looking to the future, our challenges are even greater. Over the next two years, the State of Wisconsin faces a biennial budget deficit of $3.6 billion.
While some of these financial challenges may be attributed to the slowing of our economy, the reality is that these problems were exacerbated by poor budgeting decisions approved and promoted by past elected leaders, Republicans and Democrats alike. By relying on the use of one-time money, segregated fund raids, and increases in taxes and fees, past leaders have focused on short term solutions without looking toward the future.
While these decisions may have appeared to be the easiest solution, or the path of least resistance, the bills for these decisions have come due and the path to long term financial solvency for our state requires shared sacrifices from everyone.
Today, I am introducing a Budget Repair Bill to address our current fiscal year deficit of $136.7 million. Later this month, I will introduce my 2011-2013 Biennial Budget proposal to address the pending $3.6 billion deficit.
The Budget Repair Bill will include a number of reform measures focused on bringing government employee benefits closer to the private sector, including:
· Pension Contributions - Currently, state, school district and municipal employees who are members of the Wisconsin Retirement System contribute very little toward their pensions. The bill requires that WRS employees, including myself and my cabinet officers, as well as employees of the City and County of Milwaukee, contribute 50 percent of their monthly pension contributions. This amount is estimated to be 5.8 percent of salary for 2011, which is about the national average for private sector employees.
· Health Insurance Contributions - Currently, state employees pay approximately 6 percent of annual health insurance premiums. This bill requires that state employees, again including myself and my cabinet officers, pay at least 12 percent of monthly premiums, which is still less than half of what the private sector pays. In addition, the bill directs the Group Insurance Board to implement changes to health insurance plan designs to further reduce premiums by 5 percent and will implement health risk assessments for all state employees beginning on January 1, 2012. Local employers participating in the Public Employers Group Health insurance program operated by the state will be prohibited from paying more than 88 percent of the lowest cost plan.
· Collective Bargaining - Given the above changes, the bill also makes various changes to limit collective bargaining to the base pay rate. Total increases cannot exceed the Consumer Price Index (CPI) unless approved by a referendum. Contracts will be limited to one year and wages will be frozen until the new contract is settled. Collective bargaining units will have to take annual votes to maintain certification as a union. Employers will be prohibited from collecting union dues and members of collective bargaining units will not be required to pay dues. These changes take effect upon the expiration of existing contracts. Local police and fire employees and State Patrol Troopers and Inspectors are exempted from these changes.
Collectively, these changes will result in savings of approximately $30 million in the remaining few months of the current fiscal year.
In the days ahead, some may attempt to misrepresent these reform measures, spreading inaccurate or misleading information. To ensure that you know the facts, I would like to proactively address these issues.
Furloughs - Over the last several years, state employees have been required to take furloughs resulting in an across the board pay cut of approximately 3 percent. The Budget Repair Bill and my 2011-2013 Biennial Budget proposal will not include additional furlough days for state employees.
Layoffs - Without the pension and health care reforms described above, saving $30 million over the last three months of the current fiscal year would require laying-off more than 1,500 state government employees. By implementing these reforms, the provisions contained in both my Budget Repair Bill and my 2011-13 Biennial Budget proposal are focused on avoiding layoffs for state employees.
Wisconsin’s Civil Service System -The Budget Repair Bill and my 2011-2013 Biennial Budget proposal will not include any provisions to alter or modify the main tenets of Wisconsin’s Civil Service System, one of the strongest in the nation. The grievance and dispute resolution systems currently in place, as well as all employee protections, will remain.
Vacation and Sick Leave Policy - Recent news stories have suggested that I am considering altering the state’s vacation or sick leave policy. The Budget Repair Bill and my 2011-13 Biennial Budget proposal will not include any provisions to alter or modify state employees’ vacation or sick leave policy. In addition, benefits currently accrued by any state employees will not be altered in any way.
Last week in my State of the State Address, I shared my belief that government employees are among some of the most honest, hard working, dedicated, professional workers in this state. I sincerely believe that.
We all recognize that these are historic times that require us to rethink how government operates. I ask that we continue to work together to do what is necessary to bring the state’s spending in line with our taxpayers’ ability to pay.
Wisconsin’s state employees are second to none in our nation. Our citizens expect great service, and you have delivered. I know you will continue to deliver top-notch programs for Wisconsin’s taxpayers. Thank you again for your service to our state.
Sincerely,
Governor Scott Walker
And finally, the text of the email sent by the State Superintendent (which is an elected and not a position appointed by the governor) to our Department. It really highlights the kind of every day culture here that is a huge part of why I love my job, and want to avoid leaving if I can.
Dear Colleagues,
We, too, just received this information and have not had time to analyze the contents of the budget repair bill and its impact on all of us working here. I share your concerns and understand that uncertainty creates angst and confusion, which is why I have asked staff in the Division for Finance and Management to begin the task of carefully and quickly looking at what the changes mean for us. Once the analysis is complete and additional information becomes available, we will get this information to you and provide opportunities to have all our questions answered.
I have been part of the Department of Public Instruction family since 2001 and have seen first-hand the tremendous work that you do each and every day, reaching out to the many different constituents we serve. Your work has been exemplary and I have been proud of all you do to strengthen the connections among students, parents, educators, and the general public. I will continue to do everything in my power to move education forward and support you in your work.
I have the highest respect for public servants and thank you for all that you do on behalf of Wisconsin’s children. You truly are the angels.
Tony Evers, PhD
State Superintendent