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Culver OKs state pay raises

By JASON CLAYWORTH • • November 20, 2010

Editor's note: This article has been updated to provide more specific information about how much proposed raises to union employees would cost Iowans and about the frequency of pay raises that employees would receive.


Gov. Chet Culver's administration agreed Friday to offer pay increases for state employees that will cost taxpayers more than $200 million, despite Republican requests that the decisions be delayed until Terry Branstad becomes governor in January.

A Branstad spokesman called the deal "reckless," and House Republican Leader Kraig Paulsen said it would likely lead to layoffs.

But Culver defended the decision, noting that most state employees took at least five unpaid days in the past year along with suspension of employer deferred compensation contributions.

"These people are on the front lines of delivering vital services and information to the people of Iowa and deserve to be paid in accordance with their qualifications and efforts," Culver said in a statement.

Union members will formally meet to accept or reject the state's offer later this month, but Danny Homan, president of Council 61 for AFSCME, said: "In my mind, this is done."

The wage hike plan would give members of the American Federation of State, County and Municipal Employees, better known as AFSCME, two raises in each of the next two fiscal years.

Those employees would receive a 2 percent wage increase on July 1, 2011, and another 1 percent the following Jan. 1. They would receive identical raises in the following year.

In addition, many union members who are not at the top of their pay grade would receive an additional 4.5 percent raise, known as a step increase, for certain professional milestones or for job longevity and other career advancements.

The total cost of the contract is estimated at around $200 million over two years, based on previous data released by the state department of management.

"The state accepted the union's proposal," said Homan. "I believe that probably ends this process."

Homan noted that the union had decided what it would request from the state before the Nov. 2 elections, even though the contract proposal was formally submitted on Nov. 5.

AFSCME represents about 13,000 state employees, more than any other union. Typically negotiations run into the early months of the year and include considerable back-and-forth until a deal is struck.

Negotiations with the state's two other unions - the State Police Officers Council, and the Iowa United Professionals and United Electrical Workers, Science United and Professional Services Unit - are continuing.

Should agreements not be concluded before Branstad takes office on Jan. 14, unions would have to work with his administration on a new deal.

And that could set them back because Branstad campaigned on forcing state employees to pay health premiums.

Angel Albert, a spokeswoman for Culver, declined to comment on the timing of the agreement. However, Robert Bailey, a spokesman for the Iowa Department of Administrative Services, said his agency simply followed the rules.

"We were provided a proposal. We responded to the proposal following the rules of collective bargaining," Bailey said. "We hope this isn't an issue that's debated in the media when it's really a collective bargaining agreement."

A review last year by The Des Moines Register showed that Iowa is one of only six states to offer free health insurance to state government employees and their families.

Iowa's state employees also pay substantially lower out-of-pocket health costs, such as deductibles and office co-payments, than private-sector workers, according to an independent study of nearly 900 businesses and government employers conducted this year by David P. Lind & Associates of Clive.

The Iowa Department of Management, in previous years, has released a statement showing how much the union concessions would cost taxpayers.

That wasn't immediately available Friday. However, in 2009, each percentage point increase in state employee salary cost taxpayers $32.2 million.

"Taxpayers are the losers in this backroom deal," said Jeff Boeyink, Branstad's chief of staff. "Governor Culver's decision to rush through a collective bargaining deal with state employee unions before he leaves office is reckless and irresponsible. This will cost Iowa taxpayers $103.5 million the first year alone, and hundreds of millions in subsequent fiscal years."

Paulsen, the House Republican leader, said that in some cases, some state employees would receive a roughly 15 percent salary increase over the next two years, largely because of step increases. He said the extra costs will likely cause lawmakers to have to trim the budget even further when the legislative session begins in January. Layoffs are possible, he said.

"I'm awfully disappointed that those negotiations were completed," Paulsen said.

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