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How was the budget padded for the AFSCME contract? Administration only offers broad clues, no specifics

Monday, Jul 31, 2023 - Posted by Rich Miller

* My weekly syndicated newspaper column

Illinois Republicans have been saying ever since a state budget deal was announced by the majority Democrats that not enough money was appropriated for fiscal year 2024 to pay for the new AFSCME Council 31 employee union contract. Some have even predicted that the contract plus other spending pressures, including health care for undocumented immigrants, will eventually lead to a tax hike.

Gov. J.B. Pritzker said in June, weeks before the contract was finalized, that the GOP claim was “one of those false things that Republicans like to say about the budget.” In fact, he said, “We built in what we thought might be the appropriate amount of money for what we expect from that AFSCME negotiation.”

The contract ended up with a fiscal year 2024 price tag of $204 million (the Republicans had predicted costs of $200-300 million). So, where is that money in the budget, which passed a month before the negotiations ended?

I turned to Carol Knowles, who is the deputy director for communications at the Governor’s Office of Management and Budget (GOMB).

“The agencies officially did not budget for COLAs in their budget submissions,” Knowles said via email of employee cost of living raises. And she said her office didn’t give the agencies any guidance about the topic, either, “as that would be not respectful of the labor negotiation process by indicating ahead of time what number the administration was willing to pay.” It also wouldn’t be smart negotiating to tip the state’s bargaining hand in advance, but she didn’t say that.

Because the cost increases weren’t submitted to the legislature, “some lawmakers may have interpreted that as ‘there is no money in the budget for the union contract,’” Knowles said.

But, Knowles continued, “There was cushion in agency budgets to assist them in managing in the new fiscal year.”

Knowles explained that GOMB, “spends most of the year building and planning for upcoming fiscal year agency budgets, and have a lot of knowledge regarding individual agency spending patterns, hiring patterns, lag time to hire and appropriation flexibilities, that sort of thing, and work with agencies to estimate when/if in a fiscal year people will be hired, how many will retire, and what the new folks will earn, etc.”

So, she said, “Early in the budget building process last fall for Fiscal Year 2024, one of the things GOMB did was work to identify what the cost of a 1% COLA for AFSCME employees might mean for each individual agency. We could scale that number when we needed to. That data would then give us a good basis/knowledge going into the spring session.”

Knowles continued that they put some “additional funding/flexibility” into the governor’s budget proposal in February beyond cost of living increases.

I had zero luck getting any actual numbers from the budget office, but Knowles did provide a hint, saying part of what they did earlier this year “was provide more flexibility than in a typical year on various assumptions we use to build the personal services budget,” to help the agencies “absorb some of the likely costs that would be associated with a new contract.”

They then shifted more salary dollars around in the final budget package, she said. And then they gave the agencies even more flexibility by allowing them to repurpose up to 8 percent of their operating budget for other uses. “So, while we didn’t know the dollar amount that would be needed, we believe we have put good tools in place to allow agencies to be able to manage much of the first year impact,” Knowles said.

Now that the contract has been ratified, Knowles said, “we will be working with the agencies to determine whether our various assumptions will work for the agencies.”

I asked for more specifics of how the “cushion” was built. “Increased appropriation authority was added to various lines,” was all Knowles replied.

OK, so the bottom line is we still don’t know where that money was stashed in order to create a “cushion” for agencies. A little extra appropriated here and there, particularly for salaries, is what it looks like.

Allowing agencies to transfer up to 8% of their appropriations between line items is also key. That money can be moved around to pay for 22 different categories of spending, including personal services, pension contributions, group health insurance, etc. So, they basically could’ve padded just about anything.

I assume the budget office refused to reveal much because it would provide keys to legislators and others to figure out how they do the voodoo they do. But this is beyond opaque.

       

15 Comments
  1. - Teve Demotte - Monday, Jul 31, 23 @ 9:06 am:

    Great reporting.


  2. - Rich Miller - Monday, Jul 31, 23 @ 9:11 am:

    ===Great reporting===

    Thanks, but I disagree. I didn’t get my questions answered and it’s still bugging me.


  3. - DHS Drone - Monday, Jul 31, 23 @ 9:19 am:

    The budget is padded by 8000 vacancies that are budgeted for and not paid out. We’ll hire some this year, but I doubt the net increase will go up much. A whole lot of retirements are coming as offices are starting to bring people back tomorrow. Now that “status quo” is gone, agencies have a lot more flexibility to bring people back on rotation or demand in office once a week. You have plenty of retirement eligible who have just been waiting for the email to come back before they pull the trigger with SERS. That is how we will pay for these colas.


  4. - Regular democrat - Monday, Jul 31, 23 @ 9:33 am:

    That some serious mumbo jumbo. That is the best contract i have seen in decades and by far the best non explanation of how to pay for it. If you foia anything you will need ernst young to decipher it. Govt at its best. I dont think you are going to give up my money is on you Rich to get better answers.


  5. - oerf2983y4rfhow - Monday, Jul 31, 23 @ 10:19 am:

    So like 0.25% of a 50 Billion dollar budget? Did these same “Illinois Republicans” complain mightly when Rauner submitted budgets with Billions of pure fantasy revenue and savings? I am sure they are glad they could find someone to carry their water with such complete bs talking points.


  6. - Papa2008 - Monday, Jul 31, 23 @ 10:28 am:

    DHS Drone is right on the money. Know of 1/2 dozen potential retirees waiting just for that email.


  7. - levivotedforjudy - Monday, Jul 31, 23 @ 10:40 am:

    You can’t negotiate if you show the other side your checking account. I get it. The administration needed to finalize the contract after session ended.


  8. - Frida's boss - Monday, Jul 31, 23 @ 12:07 pm:

    Pay no attention to the man behind the curtain.


  9. - Back to the Future - Monday, Jul 31, 23 @ 12:07 pm:

    Actually thought it was a very good column.
    Sometimes asking the right questions is more important than the answers you get (or in this case the lack of answers).
    Thinking the nondisclosure of information or false information given to the Senate and House Appropriations Committees is always harmful to the budget process.


  10. - Candy Dogood - Monday, Jul 31, 23 @ 12:14 pm:

    It is pretty easy to find money in the budget when the Pritzker administration has failed to fill thousands of positions that are included in the budget.


  11. - Southern Belle - Monday, Jul 31, 23 @ 12:54 pm:

    Come on!! The Governor’s office didn’t say one word about padding the agency budgets until the Republicans started exposing his unbalanced, gimmicks -filled budget smoke screen. Now, the agencies will have to make up the dollar deficit through cutting line items in their agency budgets. The filling of vacancies, deferred maintenance…. will all be negatively affected by the budget deficiency. Shame on the administration for the lack of truth and transparency.


  12. - Demoralized - Monday, Jul 31, 23 @ 1:29 pm:

    == has failed to fill==

    You act as if this is being done on purpose. Where I work vacancies are happening as fast as we can fill them. Perhaps try knowing the facts before spouting off.


  13. - Anyone Remember - Monday, Jul 31, 23 @ 1:59 pm:

    ” … failed to fill … .”

    Actually …

    https://capitolfax.com/2022/11/16/mcfarland-mental-health-center-workers-warn-of-severe-staff-shortage/#comment-13584651


  14. - Hank sauer - Monday, Jul 31, 23 @ 3:00 pm:

    Very few comments because the story does not fit the narrative


  15. - Oswego Willy - Monday, Jul 31, 23 @ 3:06 pm:

    ===Very few comments===

    There’s 13 before your trolling.

    Instead of trolling, what exactly is the narrative you think isn’t fitting, or what is the issue.

    I’ll give ya a hint, if you read even a comment by Rich, it’s because there are big questions left unanswered.

    Start there.

    To the post,

    A budget is a weight and measure of policy in the actual weight… of actual dollars.

    Rich’s column is about the questions to weighing and measuring a budget and contract that allows easily seen, purposefully overt showing of dollars.

    The question for me is how and when the weight and measure will allow the fullest of the disclosures


Sorry, comments for this post are now closed.


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