State Employee Concession Package: The devil is in the details


Taking the Governor and state unions at their word, Connecticut’s media outlets reported Friday that the new state employee concession package will save Connecticut $1.6 billion over the next two years.

Although Governor Malloy repeatedly said that nothing less than $2 billion would do, the $1.6 figure was touted as a major victory by all involved.

Actually, it turns out that the Malloy Administration projects savings of only $700 million in the first year and $900 million in the second year leaving the existing approved budget about $300 million dollars in deficit for the fiscal year beginning July 1, 2011.

To address this new deficit the Governor said he would make up the gap with additional budget cuts and by using some of the unanticipated revenue that has been coming in recently. (Thank you Connecticut gas tax #2).

Both sides agreed to keep the details of the deal secret in order to provide the SEBAC union coalition time to educate their members about the agreement.

Without knowing the details it is impossible to determine the accuracy of the projected $700 million figure.  The few details about the package that are public include:

(1)  A wage freeze for two years for all unionized employees

(2)  After the two year wage freeze, unionized state employees would receive 3 percent pay increases 2013, 2014 and 2015

(3)  Newly hired state employees would no longer be eligible for longevity pay (but of course new employees would not have qualified for longevity payments for 10 years anyway but it sounds good)

(4)  The age of retirement would be increased from 60 to 63 for Tier II employees and 62 to 65 for Tier IIA employees but apparently that change would not take place until 2017

(5)  Although the 4 year no-layoff clause would cover all unionized employees, it would not protect non-union managers who could be laid off the next two years

(6)  Finally, by all accounts the agreement includes “big changes to the health insurance plan.”

In addition, among the rumored changes will be a new requirement that all employees will have to contribute 3% of their salary to help fund the cost of state retiree health benefits.  Connecticut has huge unfunded liabilities for future state employee pensions and retiree health benefits and this change would begin the process of addressing the retiree health fund crisis.

One side note, the Governor was especially keen on pointing out that there were no furlough days in the agreement.  At his Friday press conference announcing the agreement he said “One more point: there are no furlough days in this agreement, nor is there a reduction in the 40-hour work week. This means we’ve achieved these savings without reducing government’s ability to serve its constituents, and without reducing employees’ productivity.”

It is an impressive agreement by any standards, but the real question is:  If it actually saves $700 million next year, then what has not been revealed and why?

A real wage freeze saves about $160 million and having employees pay 3% of their salary to fund retiree health benefits “saves” about $100 million.

Together these two items save about $260 million, so if they are being truthful about the $700 million, there is only $440 million to go.

Those must be pretty damn impressive changes to healthcare and benefits.

In addition to the changes in retirement age (which would save some money down the road), certainly look for reductions in the annual Cost of Living Adjustments for retirees, and perhaps a  change in how a retiree’s pension is calculated.  (Maybe using their average salary over a five-year period rather than the present three-year system).

However, that still doesn’t come close to explaining where an additional half a billion in concessions is coming from.

Last, but not least, back to the interesting point that the Governor felt he need to highlight the fact that no furlough days are part of this agreement.

Many states and even some private employers have been using furlough days.  Employees are told to stay home a certain number of days and that way the employer doesn’t have to pay them for that day of work.  It serves as a temporary (one year) reduction in pay without actually cutting the
employees pay over the long-term.  In Connecticut, each furlough day saves about $14 million dollars.

By requiring state employees to pay a new 3% of their wages to retiree health benefits, the employee is getting a true 3% reduction in salary.  This is equivalent to instituting 7 days furlough a year for the duration of a state employees’ career. The only difference is employees will actually have to go to work in order not to be paid.

It will be interesting to see what happens next.

And don’t forget that 14 out of the 15 SEBAC unions must vote yes to implement the pension and health care changes.

Individual unions could still accept the wage freeze but without the pension and health care changes the total amount saved won’t even be 20% of the amount that has been publicized.

Flash Back – Wisconsin is not Connecticut, Right?


The date was March 2, 2011:  Day 1 of the Malloy/State Employee negotiations.

“But before we think that Connecticut and Wisconsin have nothing in common when it comes to the rights of workers, let us remember that efforts to undercut unions and the rights of employees to join together for their common good come in a variety of forms.

Like bullying, anti-union efforts can be overt, covert or both.

Bullying occurs when a “person intentionally inflicts injury or discomfort upon another person, through physical contact, through words or in other ways”.  It is behavior that seeks to intimidate, offend, denigrate or humiliate a person or group of persons.

As we know, now more than ever, bullying is a form of abuse that is often perpetrated on another as a way to intimidate someone to take some particular action.

Governor Malloy’s entire budget is based on state employees agreeing to make $2 billion dollars in wage and benefit concessions.

Anyone familiar with Connecticut’s state budget knows it is a number that literally cannot be achieved and the Governor purposely put out a number that is designed to fail.

Disguised as shared sacrifice, the Governor’s proposal is scapegoating of the worst kind since he has repeatedly connected his demands to the state employees with the warning that if the state employees fail to provide $1 billion in annual savings, he will be forced to shred the safety net and lay-off thousands of employees at a time the unemployment rate makes it clear that many of those laid off will not be able to find jobs.

Malloy has been very clear. If state employees don’t come up with a billion dollars in concessions – this year – the most vulnerable and needy people among us will be hurt and the fault will lie squarely with the state employees and no one else.

Even today, as the Malloy Administration and the state employee unions prepare to officially sit down for the first time, Malloy’s chief political advisor said that the “governor hopes and expects the talks to be productive and will produce the money that’s necessary to help balance the budget,”

The facts could not be clearer.

Saying that his budget is balanced when he knows it is not and then setting up Connecticut’s state employees to take the fall is more than a gimmick, it is nothing short of a mean-spirited form of bullying.

The definition of bullying is clear.  A person or group is being bullied when “exposed, repeatedly and over time, to actions that seek to intimidate, offend, denigrate or humiliate.

Let’s face it, today the Connecticut’s Public Employee Unions will be sitting down with representatives of an Administration that would be expelled from school or fired from the workplace for the intentional bullying that they have perpetrated.


Flash Forward:  May 10, 2011…. Now let’s ask the question again, is Connecticut really that different from Wisconsin?

All on the Democratic Watch…..


Ironic – to say the least – as 4,700 state employees get layoff notices.

It is quite a story.  A Democratic Governor, a Democratic legislature and now 4,700 Connecticut state employees and their families await news that they will be joining the ranks of the unemployed.

It could safely be called the greatest anti-public employee initiative since Connecticut adopted collective bargaining in 1974.

Over the past 37 years Connecticut’s public employees have faced their  ups and downs.  We’ve even seen layoffs before.  John Rowland, for example more or less laid off 3,000 state employees for a bit..

But in all these years we haven’t seen a time like this where 10% of Connecticut’s state work force awaits the news that they are the victims of an ugly game of chess in which the real goal is force the public employee unions and state employees to take on an unfairly large share of the burden of balancing the budget.

All this while the Democratic Party holds control of the Governor’s Office and maintains strong majorities in the State Senate and State House of Representatives.

So what is the problem?

Overarching everything seems to be the sense that the public demands blood and state employees must be sacrificed to prove that our elected officials truly recognize that politics as usual cannot continue.

It is not as if Connecticut’s state employees failed to recognized the notion that these are difficult economic times and they must share in the sacrifice.

On top of paying the higher taxes that all middle income families will be paying, state employees and the unions that represent them have known all along that a significant concessions package would be needed to balance the state budget.  Wages freezes, furlough days, higher co-pays and deductibles, increased pension payments were all going to be part of the “solution” that ensured that state employees were going to pay more than their fair share.

The problem was – and is – that when Governor Malloy selected the figure of $2 billion in required concessions, he chose a number that was simply not achievable.

And so now the process has played out to its predicted end.

There is no question in my mind that the goal was and has always been to ensure that if additional cuts were needed to balance the budget, the public blame for that catastrophe was blamed solely on state employees and not elected officials.

Governor Malloy deserves credit for sticking to the script.  If the $2 billion in concessions was not achieved thousands would lose their jobs and then he would have no choice but to make deep cuts to Connecticut’s safety net which would regrettably hurt Connecticut’s must vulnerable citizens.

And through all of this, as noted previously in this blog, there is nothing but silence and complicity from Connecticut’s other Democratic leaders.

Sadly this charade has also been perpetuated by much of Connecticut’s news media which has praised the Governor for his “political courage” and failed to point out the obvious that under no circumstances was $2 billion in labor concessions ever achievable.

Now,there are another 4,700 Connecticut families who have joined the ranks of people who fear that they may lose everything;

Tens of thousands will be impacted by the Plan “B” budget cuts.

And this debacle has played itself out without any effort to find a truly fair and workable solution to Connecticut’s budget crisis.

What a mess…

Embarrassment Mixed with A Heavy Dose of Anger


Apologies for the typos in this blog post….tried posting from a blackberry…. will never try that again!

Since there are comments attached, I’ll fix a couple of problems but won’t take it down.

That’s about how I’d explain my feelings as I watch the train wreck that is taking place in Hartford.

The Governor, elected as a Democrat, seems increasingly comfortable with his role as Lead Bully in the ongoing effort to scapegoat Connecticut’s
public employees. As if reading from the script of an old western that they jacked Malloy looks into the camera, narrows his eyes and proclaims, as
recorded in the CT Mirror, “They know the deadline. I know the deadline…There’s not a lot of time before we have to start to do things.”

Meanwhile, Malloy and his political spinners talk, as if they deserve praise, that he has decided to delay sending out 4,700 layoff notices for an additional day and remain “hopeful” that state employees will capitulate and produce $2 billion dollars in concessions that are needed…

Or the Governor will be forced take it out on Connecticut’s most vulnerable citizens by implementing devastating cuts to the state’s safety
net and other vital programs.

And through all this, as noted previously, there is nothing but silence and complicity from Connecticut’s other Democratic leaders.

For more on the latest check out and

Or perhaps skip straight to Colin McEnroe commentary piece in yesterday’s Hartford Courant entitled “A Budget In Wonderland” where he writes “I was trying to remember whether I had ever seen this done before. I have covered many state budgets but have then usually engaged in  trepanation  — the primitive process of punching a hole in the skull to treat intracranial diseases such as seizures, migraines or remembering speeches by former Sen. Richard Bozzutto. I don’t think I remember the state passing a budget $1 billion of which will be arrived at a later date by some combination of threats and finagling. I think it’s even in the constitution that the budget has to balance…But then I think: “Hold on, Mr. Gloomy! Turn that frown upside down! When did you start insisting that the Connecticut legislature and governor make sense? That’s like demanding that Lewis Carroll be bound by the laws of physics.”

Stay tuned, more to come.

Malloy Delays Layoff Notices….till next week?

1 Comment

Earlier today the  Malloy Administration informed the State Employees Bargaining Agent Coalition (SEBAC) negotiators that they will NOT BE issuing layoff notices to unionized state employees before next week.

Whether the decision was based on politics or policy remains a mystery.

Perhaps the Governor’s people realized that bullying tactics would backfire.

More details as they become available.

Malloy Ramps Up His Psychological War on State Employees


REVISED AND UPDATED  (cross-posted from Pelto’s Point at the New Haven Advocate)

The ugly truth facing Connecticut became increasingly apparent Wednesday as Governor Malloy signed into law a new state budget that is $2 billion out of balance.

A budget that from the very beginning was designed to fail while making Connecticut’s public employees the scapegoats for the state’s fiscal problems.

Over the last 48 hours, relying on unachievable concessions from Connecticut’s state employees, Democratic Legislators approved Governor Malloy’s plan that will eventually lead to massive cuts to vital services.

Rather than confront that truth and raise sufficient revenue or identify and approve additional cuts the Democratic majority held fast to the lie that $2 billion in concessions could be achieved.

However, with only 45,000 active state employees, a legal impediment to reducing the benefits provided to retirees and a legacy of underfunding Connecticut’s state employee pension and health care costs it is literally impossible to achieve a $2 billion concessions package that would survive the negotiation and approval process.

Now, with the budget approved, this twisted approach to governing moves forward as the Governor announces that tomorrow he will issue 4,000 lay-off notices and that “everything is on the table” for additional cuts.

The magnitude of the budget lie is becoming apparent.

4,000 Connecticut state employees and their families now wait in fear for the news that their lives will be plunged into chaos as they are thrown into the world of unemployment during the greatest economic downturn of the past 50 years.

Adding insult to injury, laying off 4,000 employees will not only impact the quality and availability of important state services but it will only “save” the state about $300 million leaving a hole of at least $700 million in the coming year’s budget.

According to the Governor’s rhetoric, this “deficit” will only be eliminated through additional cuts rather than additional revenues – despite the fact that the new budget gave Connecticut’s super wealthy a pass on being required to pay their fair share in taxes.

Cutting $700 million more on top of the record cuts that have already been adopted will have a profound and devastating impact on Connecticut’s most essential services.  The quality of life for tens of thousands, including some of Connecticut’s most vulnerable citizens is now at risk because legislators would not face the reality that they were voting on a fraudulent budget plan.

Meanwhile, like so many politicians around the country, Governor Malloy continues to blame this impending disaster on public employees as he ramps up a game of psychological warfare to force concessions and set the stage for cuts in services that can then be blamed on the state’s workers.

And as this horrible strategy plays out there is nothing but silence from Connecticut’s Democratic officeholders.

Imagine if Pratt & Whitney announced 4,000 layoffs.

No, better yet, think back to the times that Pratt has announced layoffs of far fewer employees.  Rallies with Democratic politicians on the picket line calling for investigations, demanding meetings and charging that the company is engaged in union busting.

But now when the shoe is on the other foot and a Democratic CEO who is unfairly targeting employees….Silence.


Psychological warfare or political gimmick gone bad


Cross-posted from Pelto’s Point (New Haven Advocate)

Connecticut media are abuzz today with reports that Gov. Dannel Malloy’s “Plan B” to dealing with historic deficits ($1 billion in concessions from public-sector workers) may be cutting $1 billion in state aid to Connecticut’s  cities and towns.

The question is whether this is another case of Malloy’s psychological warfare to demonize Connecticut’s state employees or a political gimmick gone bad.

For an administration that can’t get out of campaign mode, the evidence actually suggests the latter.

The Associated Press reports that, “Connecticut cities and towns would lose one-third of their state aid under a contingency plan Gov. Dannel P. Malloy has requested in case there is no agreement on $1 billion in union savings and concessions to help balance his budget.”

The Malloy administration has even created a list that reduces every local government’s state aid by 35.83 percent.

However, when the Connecticut Post asked Roy Occhiogrosso, Malloy’s chief advisor, about the $1 billion cut-list (which was leaked to the Post on Tuesday), he said it was developed in response to complaints about why Malloy hadn’t balanced Connecticut’s budget without raising taxes.

Occhiogrosso said cutting $1 billion in aid to cities and towns would be like New York Gov. Andrew Cuomo’s plan to cut $4.65 billion in aid to New York’s cities and towns. Occhiogrosso pointed out that the cut-list’s town-by-town breakdown indicates just how devastating a $1 billion cut would be.

Meanwhile, the Connecticut Conference of Municipalities, the state’s primary lobbying arm for local governments (and an organization that Malloy once chaired) called the plan a “doomsday budget.” It said: “A billion-dollar cut in municipal aid will result in massive municipal employee and teacher layoffs across the state.”

Yet later that same day (Tuesday), the governor’s office was handing out the $1 billion breakdown to reporters and Occhiogrosso was saying to the Associated Press and other media “There are only so many places where you can go to get large sums of money to get to $1 billion, if that number is not reached in discussions with labor … Municipal aid is certainly one of those places. It represents a large portion of the budget.”

Occhiogrosso added “There are different scenarios being looked at — municipal aid, reduction in state agencies’ (budgets), several different scenarios. The governor’s been pretty clear that one thing will not happen. Taxes will not rise beyond what he has already proposed … Everything else is on the table.”

So what exactly is this “doomsday budget”?

Is it a document designed to explain Malloy’s decision not to use Cuomo’s approach. Or is it a genuine plan to destroy every town’s local budget and local school system if state employees are unable to come up with the unachievable $1 billion in concessions.

Either way, it is a maneuver more in line with a political campaign than the thoughtful approach of a chief executive.

For me, the primary clue to what is going down is that Malloy’s town-by-town breakdown does not differentiate between towns that could survive a massive cut in aid and those that could not. Whomever authorized this list decided to simply cut 35.83 percent from every town. No reasonable policymaker, especially no Democrat, would ever propose cutting municipal aid by the same percent in every town.

The fact is a cut in municipal aid of more than a third to a town like Greenwich, with its extraordinary tax base and limited municipal demands, would create far less damage than a similar cut to a city like Hartford or Bridgeport.

It is more than far-fetched to think that this $1 billion cut-list could really be part of Malloy’s “Plan B”.

The Malloy people would do themselves and the state a big favor by developing a “real” Plan B if they can’t squeeze the billion from the state’s employees.

“Time for Malloy to come clean”

No Comments

Cross-posted from Pelto’s Point (New Haven Advocate)

A “shout out” and thanks to Keith Burris, the editor of the Journal Inquirer, for adding his voice to the call for Governor Malloy to reveal his “secret” plan to get $2 billion in concessions from Connecticut’s state employees. 

The Middletown Press ran Burris’ piece here – Time for Malloy to come clean  

On the issue of the Governor’s proposed solution to Connecticut’s fiscal crisis and his plan to balance the budget with $2 billion in employee concessions, Burris points out that “there is one massive gap in the governor’s mathematic and political reasoning…We still do not know where Malloy expects the state employees to make their sacrifices.  Where, exactly, will the billion a year come from?”

Malloy has repeatedly talked about shared sacrifice and transparency in government and Burris successfully calls Malloy to task when he writes “The time has come for the governor to reveal to us what he has proposed to the unions. In fairness to state workers and in fairness to the taxpayers, tell us what the plan is.”

Governor Malloy’s budget does rely on $2 billion is employee savings. 

Malloy’s advisor and spokesman has even gone so far as to say that they have a plan to achieve that number but they will not reveal it.

Burris’ response to Malloy’s secret plan is absolutely correct.

“Tell us what you are proposing to the unions, Governor.  Put your cards on the table.  The public has a right to know.  It will only help your credibility and your bargaining position to reveal what is behind that curtain.”

Hopefully others will pick up the call as well.  It’s time for Malloy to “come clean” on his secret plan.

And so it begins…


Cross-posted on Pelto’s Point (New Haven Advocate)

When Governor Malloy submitted his Connecticut State Budget proposal in February it included $1 billion dollars in employee concessions for FY 12 and another billion for FY 13.

Those who appreciate the realities of how Connecticut’s budget works recognized immediately that such a figure was not achievable.   There was simply no way that $1 billion dollars in employee savings could be achieved in one fiscal year.

Malloy Walks the Picket Line

The question was and remains today – why would the Governor propose a budget that he knew was destined to be as much as $500 million or more out of balance?

Sadly, the clues were immediate.

At the time, Malloy said that “if” the concessions were not forthcoming, but he was confident that they would be achieved, he would be forced to lay off thousands and shred the State’s safety net.  He was very clear.  The blame for this catastrophe would rest solely on the heads of Connecticut’s state employees.

And now the next phase in this drama has begun…

On Friday, the CT Mirror ran a story entitled “Municipal aid is at stake in Malloy’s talks with labor

The story leads with a quote from Malloy’s top advisor Roy Occhiogrosso, who said “All the assumptions will have to be re-examined, because he is committed to producing a balanced budget with no gimmicks, and if the savings don’t materialize there are only so many places to go for money…Municipal aid is one of those places.”

Faced with the inevitable failure to pull $1 billion dollars out of Connecticut’s state employees, the Malloy administration is now ramping up their rhetoric. 

As a result of their inability to produce $1 billion in concessions, state employees will now not only be responsible for putting many of Connecticut’s most vulnerable citizens at risk, but we are now learning that aid to cities and towns will be cut and the corresponding local property taxes increases that will be needed will be another tribute the state employees’s failure to produce the appropriate savings.

Yet the Malloy Administration has never admitted that the number they are demanding from Connecticut’s state employees is “almost double what New York Gov. Andrew Cuomo obtained from his much larger work force.”

And even worse, although the Malloy Administration says it has a detailed concession plan that amounts to $1 billion dollars they refuse to make their “secret plan” public.

Although rank and file state employees seem almost unanimously committed to doing their fair share to balance Connecticut’s budget, few – if any – understand the extent to which they have been set up to fail.

This is a dark time for Connecticut’s state employees and it will get darker in the coming days as the Malloy Administration announces with ‘”surprise” that the $1 billion dollars in concessions cannot be achieved.

I’m sorry, what was that about excessive state employee salaries?


Courtesy CTMirror

Cross-posted on Pelto’s Point (New Haven Advocate)

FACT #1:     Ben Barnes, Malloy’s new Secretary of the Office of Policy and Management receives a salary of $187,000 a year.  Ben, one of the brightest guys you will ever meet, has 7 years of experience as a government employee.  Ben also holds a master’s degree.

FACT #2:     Robert Genuario, who served as OPM Secretary for 5 years under Jodi Rell left last year with a salary of $163,910.08.  He had 29 years of experience in government, 19 of which were at the state level.  In addition to his 5 years at OPM, he served for 14 years as a State Senator, for 8 of which he as the top Republican on the Appropriations Committee.  Bob holds a law degree.

So Ben, with only 37% of the experience Bob had – and a Master’s Degree rather than a Juris doctorate – is being paid $23,000 more.

As Governor Malloy demands unprecedented state employee givebacks that could equal 20% or more of the value of their salary he might want to think about the message he is sending by complaining about the high cost of state employees.

What is that line about people in glass houses shouldn’t throw stones.

Older Entries Newer Entries