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The high cost of Rauner’s failed war with AFSCME

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Illinois

* AP…

Just days into his term of office, Gov. J.B. Pritzker last week signaled an abrupt about-face in government relations with organized labor after 4 years of rancor.

The Democrat took a series of pro-worker actions, highlighted by reinstatement of long-postponed, experience-based salary increases for state workers represented by the American Federation of State, County and Municipal Employees.

Restoration of the so-called step increases is good news in itself not only to the 20,000 employees affected but also, advocates contend, to taxpayers. Step increases, required by state law, are paid to employees in their first 8 to 10 years who, as a savings to state government, start at below-market rates as incentive to gain experience and stick around. Former Gov. Bruce Rauner halted them in 2015 when AFSCME’s last contract expired. […]

The new governor is giving clear signs that high-profile litigation with AFSCME is on the wane. Appellate courts have ruled that Rauner should pay the back-due step increases, and that the negotiations his team left 2 years ago were not at an inextricable “impasse.”

“We’re living up to the court orders,” Pritzker said Friday. “That wasn’t being done by the prior administration and that’s our job. Our job is to follow the law.”

We don’t yet know the full costs of what turned out to be Rauner’s illegal impasse declaration and his decision to stop paying step increases, but one estimate puts it at $415 million. And, as Hannah Meisel pointed out today, the state owes 7 percent annual interest on that tab…

More here.

* Meanwhile…

A program designed to curb Illinois’ pension debt is now underway. Early numbers show more Illinois state employees than expected are choosing to take a pension buyout from the state.

Public employees hired before 2011–and who have worked for at least eight years–get an annual three percent boost when they collect their pensions. That adds to what the retirees bring in, but also the cost of Illinois’ pension debt.

So, state lawmakers introduced the option as part of last year’s budget. State retirees can now choose to swap the three percent annual adjustment on their pensions for a lump sum payment–70 percent of what they would have gotten.

They also get to keep their base pension and 1.5 percent adjustment each year. […]

Since it launched in December, at least 200 new retirees took the deal, more than expected. Blair says their buyouts have ranged between $80 and $100,000.

posted by Rich Miller
Tuesday, Jan 22, 19 @ 10:58 am

Comments

The state lead by Pritzker, Madigan and Cullerton
Should
Pay its bills
Honor its contracts
Obey the law and judgment of the courts
Or
Continue
The heinous
Legacy
And sole purpose
Of Bruce V Rauner
So much suffering
Choices now
Budget the backpay and steps
Appropriate the funds
Keep the workforce

Comment by Honeybear Tuesday, Jan 22, 19 @ 11:13 am
==So called Step increases== huh ? and in the next sentence they admit Step increases are in State law..there is nothing “so called” in something that is defined in law.
==Step increases are paid in the 1st 8 to 10 years== uh no, unless you never get a promotion to a new title and that titles step increases.

Comment by Anotheretiree Tuesday, Jan 22, 19 @ 11:14 am
Rauner chose a war instead of negotiations. He lost the legal and political fights in Illinois against state workers. Now it’s costing the state more money. The union urged him to not dictate and to keep negotiating. He could have bargained for savings, but in his arrogance he got nothing.

Rauner is a poster child for staying in or joining unions. He could have financially broke individual workers through lawsuits. But that collective union money helped tremendously with legal costs.

Comment by Grandson of Man Tuesday, Jan 22, 19 @ 11:16 am
AFSCME may have won the war with Rauner, but it’s important to remember that AFSCME only cares about its members’ interests and not the overall interests of Illinois. Pritkzer should remember he didn’t need AFSCME to beat Rauner and shouldn’t feel beholden to their demands.

Comment by Chicagonk Tuesday, Jan 22, 19 @ 11:17 am
Politically, this high-risk mismanagement of government is what will haunt the taxpayers of Illinois and the GOP for years to come.

The GOP wants to frame this as a “giveaway” but Pritzker hits the issue right on the head.

==“We’re living up to the court orders,” Pritzker said Friday. “That wasn’t being done by the prior administration and that’s our job. Our job is to follow the law.”==

As he continues to “follow the law,” Pritzker will have the political cover to say this is a mistake he must correct. The ghost of Rauner will, rightly so, haunt his former political allies for years to come.

Comment by MG85 Tuesday, Jan 22, 19 @ 11:18 am
Thats 1.4% GovJunk for you.

You cannot just walk away from bargaining screaming “impasse!” .. AFSCME was actively negotiating and practically begged him to come back to the table.

Why did he want that impasse so badly.. Gotta ask him. Regardless, there was no impasse and the Agreement negotiated to 2015 remained in full force and effect.

This is the reason we should not elect GovJunk or those like him. The law is the law. It has to be paid. With interest. That cannot be negotiated away in any form or fashion.

It’s not up to Pritzker nor to AFSCME. GovJunk wanted to torpedo the state and he did it. Thank God we didn’t quite sink. There is not a single state employee that is happy with this huge bill taxpayers are stuck with. This should not have happened.

Comment by Anonymous Tuesday, Jan 22, 19 @ 11:20 am
Just another of Rauners mistakes that will keep on giving.

Comment by NeverPoliticallyCorrect Tuesday, Jan 22, 19 @ 11:23 am
Just like you and your bills. If you owe money, you have to pay the money back. Rauner did not pay the bills, at any level, including the union. Our debt went up to astronomical levels, all because he wouldn’t pay the bills. They owe the workers the money, so just pay the debt, and move on.

Comment by Retired Educator Tuesday, Jan 22, 19 @ 11:24 am
I wonder how many people who took that lump sum actually crunched the numbers.

Comment by Anonymous Tuesday, Jan 22, 19 @ 11:25 am
==Pritkzer should remember he didn’t need AFSCME to beat Rauner and shouldn’t feel beholden to their demands.==

Pritzker should, however, feel beholden to the courts demands. Even when they mirror the demands of AFSCME

Comment by Lester Holt’s Mustache Tuesday, Jan 22, 19 @ 11:25 am
The money available for buy-outs is limited. More opting for it than expected means the available funds will be exhausted more quickly. There is also a time limit, but the money will be exhausted first. I recently retired and did not take it. I’ve heard that many who have are those on special pay schedules who can retire at age 55, mainly law enforcement personnel, and that will have its own consequences.

Comment by Oberon Tuesday, Jan 22, 19 @ 11:27 am
“AFSCME only cares about its members’ interests and not the overall interests of Illinois”

This is a blatant and outright lie. Union members dutifully worked for years without the money owed to them, including no steps or longevity pay since 2015. They urged Rauner to go back to the bargaining table in big part to help the constituents they serve at work, so that there’s no disruption of services.

Comment by Grandson of Man Tuesday, Jan 22, 19 @ 11:32 am
Time for a step obligation bond (SOB). Seems to be all the rage these days.

Comment by City Zen Tuesday, Jan 22, 19 @ 11:36 am
I’m curious to see if all unions are going to receive their appropriate steps or just AFSCME members.

Comment by Anon2 Tuesday, Jan 22, 19 @ 11:38 am
@Lester Holt’s Mustache, I took the comment to mean Pritzker shouldn’t given in to all the union’s demands in the next contract, that his admin. is going to start negotiating in a few weeks.

Comment by Perrid Tuesday, Jan 22, 19 @ 11:43 am
Perrid - future negotiations should not take into account any backpay or previous steps. It is a totally new contract and steps are a legal issue at this point - not a negotiating chip.

Comment by Anonymous Tuesday, Jan 22, 19 @ 11:45 am
The news about the pension buy-out program is interesting.

Would like to see a different kind of buy-out tried: offer up-front cash now to current Tier 1 employees who agree to shift from the 3 percent annual increase when retired to a flat COLA tied to inflation. Thoughts, RNUG?

Comment by BC Tuesday, Jan 22, 19 @ 11:45 am
The buyout is a bad deal for younger employees
You get zero. Cola until you reach age 67

So if you retire at 55 your pension payment remains the same for 12 years. Then you get the 1.5

Comment by Anonymous Tuesday, Jan 22, 19 @ 11:46 am
Anon2
What other union has steps

Comment by Anonymous Tuesday, Jan 22, 19 @ 11:52 am
Anonymous is correct about it being a bad deal if retiring young. The buyout option is great if the person is sick and want lump sum money to give as an inheritance.

Comment by illinifan Tuesday, Jan 22, 19 @ 11:54 am
“I wonder how many people who took that lump sum actually crunched the numbers.” Anecdotally, one of my recently retired co-workers did, and he maintained that his payout (mid-5 digits) invested with a 7% return would beat what he would have gotten otherwise and in addition he could use the money now instead of waiting.

Comment by Skeptic Tuesday, Jan 22, 19 @ 11:56 am
A little snarky for Sure. A week into his administration JB has amassed a bill backlog of $8.1 billion. With this its up to $8.5 billion. At this rate he can surpass Rauner.

Comment by blue dog dem Tuesday, Jan 22, 19 @ 12:04 pm
So which Unions are impacted or effected by this? I have family that are ISP and do not know if they have been denied their negotiated raises. Different union or different contract agreement?

Comment by illini Tuesday, Jan 22, 19 @ 12:05 pm
The members of the Raunerite 99th General Assembly aided and abetted the bad, at times illegal behavior of Bruce Rauner.

Until I hear mea culpas, these 99th GA Raunerites are as much at fault, and are complicit in these monies that will need to be paid, beyond Rauner’s anger they not be paid.

It’s time for Republicans to do what’s right… even the cowards… as Rauner is not here anymore to see who is causing $&@#% problems.

Comment by Oswego Willy Tuesday, Jan 22, 19 @ 12:06 pm
There is a joint prehearing memo on steps and backpay due at the labor board in two days. I will FOIA it. Hearing starts January 31 unless both sides withdraw their charges and call it off. I’m a bit worried they’ll call it off without putting forth a timetable for payment.

Comment by A Non Tuesday, Jan 22, 19 @ 12:09 pm
== Would like to see a different kind of buy-out tried: offer up-front cash now to current Tier 1 employees who agree to shift from the 3 percent annual increase when retired to a flat COLA tied to inflation. Thoughts, RNUG? ==

State has never offered that. The State has always wanted to cap their potential luability. With inflation starting to heat back up, it could cost the State more than the current flat 3%.

Plus a flat 3% annually is easier to budget for.

Comment by RNUG Tuesday, Jan 22, 19 @ 12:14 pm
==Skeptic== Your friend is gamboling. He is counting on a 7% return when we are 10 years into a bull market. The market can go flat for 16 years (I.E 1966-1982),or take 24 years to return to a previous top (1929 - 1954).You can get away with that if you have a 40 year time horizon..retirees by definition don’t.

Comment by Anotheretiree Tuesday, Jan 22, 19 @ 12:15 pm
== Since it launched in December, at least 200 new retirees took the deal, more than expected. ==

I would say there are 200 people who don’t read Capitol Fax.

Comment by RNUG Tuesday, Jan 22, 19 @ 12:16 pm
–The money available for buy-outs is limited–

This is incorrect. The money will come from the sale of new bonds. There is no finite amount. It is only limited by those members eligible to retire by July 1 2022.

Comment by Harvest76 Tuesday, Jan 22, 19 @ 12:16 pm
I am getting ready to retire at the end of next month after 34 years with the State. The way the lump sum option was explained to me is that the state has to sell bonds to raise the money for the buy out and there is no guarantee of when people taking that option will get their money. It was not advantageous for me to take it given my age and the fact that you weren’t sure when you would see the lump sum was a bit off putting for me.

Comment by State Worker Tuesday, Jan 22, 19 @ 12:16 pm
–What other union has steps–

What difference does that make? Surely you arent suggesting that if one group doesnt negotiate steps, none should? That would be poor logic. By that standard, Maybe all employees, union or not, should have them?

Comment by Harvest76 Tuesday, Jan 22, 19 @ 12:21 pm
Blue dog dem - how is Rauner illegally withholding pay from state workers, and the expense to pay them back now, is some how JB fault?

Comment by ike Tuesday, Jan 22, 19 @ 12:25 pm
@anonymous Most other unions have steps. Only unions I know of that don’t have steps are those that use a prevailing wage.

Comment by Anon2 Tuesday, Jan 22, 19 @ 12:25 pm
Ike. Joking……

Comment by Blue Dog Dem Tuesday, Jan 22, 19 @ 12:29 pm
The back pay has to be paid, period. JB will follow the letter of the law.

The only question is, “How quickly?”

Maybe in increments over his first term? That means the 7% keeps ticking on the final cost.

OTOH, where will they find $400+ million from a single year’s budget?

The sooner the Administration figures out how it will address this, puts out a plan, and starts implementation, the better. It’s a vital financial matter for employees, and an important early show of good will and good governance practices by the Administration.

Comment by dbk Tuesday, Jan 22, 19 @ 12:36 pm
I’m hoping JB and AFSCME “hug it out” and signal that the relationship going forward is going to adult and fair, regarding the contract negotiations. Nobody in the union wanted to go to war; they were pushed to the wall by He Who Shall Not Be Named. What I think many of the union members want is fairness and stability. You make a contract? You keep it.

Comment by Anonymous Tuesday, Jan 22, 19 @ 12:42 pm
LOL’d at this

RNUG - Tuesday, Jan 22, 19 @ 12:16 pm:

== Since it launched in December, at least 200 new retirees took the deal, more than expected. ==

I would say there are 200 people who don’t read Capitol Fax.

Comment by The Dude Abides Tuesday, Jan 22, 19 @ 12:44 pm
How many State employees have retired since the aforementioned deal was offered?

Comment by Interested Tuesday, Jan 22, 19 @ 12:45 pm
== I wonder how many people who took that lump sum actually crunched the numbers. ==

Some may have. In theory, if you were to take a payout and had the self control to invest it where it earned the stock market average of 8% and had the self control to limit withdrawals from it to between 3 - 5%, you might do better. The problem is, since the State is discounting the future value of the surrendered portion of the AAI, you are starting off in a hole and have to make that up first.

But, to use the standard disclaimers “returns are not guaranteed” and “past performance is not an indication of future results”. And most people do NOT have that level of self control with large sums of money.

All of that is why I recommend keeping the 3% AAI unless there are overriding reasons.

…

As to the people who took the small payouts, I don’t know their situation but that strikes me as a really bad move. Same for the ones retiring around age 50 - 55; they gave up a lot of growth.

…

The one exception I have previously noted would be someone with a shortened life expectancy / medical issues. There an early payout could make sense, especially if you do not have a spouse. But it is more complicated if you have a spouse that would be receiving the survivors pension for a long time.

…

Everyone really needs to run the numbers. And if you aren’t comfortable doing it yourself, find an independent, fee only, financial advisor to do it for you. The hundreds of dollars spent on the a financial adviser may be your best investment ever.

Comment by RNUG Tuesday, Jan 22, 19 @ 12:47 pm
blue dog dem - it was not AFSCME that walked away from the table. There was no impasse. Rauner refused to negotiate and thus the previous contract remained. The State had to abide by that and did not do so. The steps must be paid back, even if AFSCME did not want to do so. The only way the state is entitled to that is if state employees gave it back as a donation to IDOR.

This is just foolish. It is not a giveaway, and it was not Pritzker nor AFSCME’s decision.

Comment by Anonymous Tuesday, Jan 22, 19 @ 12:53 pm
== LOL’d at this ==

- The Dude Abides - , I’ll admit I couldn’t help being a bit snarky with that comment since we’ve all previously hashed over the pros and cons of the program.

Comment by Anonymous Tuesday, Jan 22, 19 @ 12:55 pm
Per an article I read earlier, our state workers get less money than the private sector for the first eight-10 years of their careers. Step increases for seniority are reasonable compensation for the newest workers. They’re incentives for workers to stay with the state, as opposed to what Rauner wanted: low compensation jobs with possibly or probably high turnover.

Comment by Grandson of Man Tuesday, Jan 22, 19 @ 12:59 pm
Obviously, 12:55 was I. Didn’t autofill the form and I forgot to double-check.

Comment by RNUG Tuesday, Jan 22, 19 @ 1:00 pm
== as opposed to what Rauner wanted: low compensation jobs with possibly or probably high turnover. ==

Based on his actions, it appeared Rauner wanted a collapsing workforce failing to deliver services.

I can think of 2 reasons he might want that. (1) A desire to just eliminate the service and/or (2) A desire to completely outsource the service delivery.

Comment by RNUG Tuesday, Jan 22, 19 @ 1:07 pm
The buy-out programs seem to be efforts to incentivize employees into making bad long-term financial decisions. But, on the bright side, at least it’s not unconstitutional.

Comment by Roman Tuesday, Jan 22, 19 @ 1:21 pm
Harvest
Not at all. We seem to only hear about Afscme.
Just curious about what other unions have the same type step structure

Chill

Comment by Anonymous Tuesday, Jan 22, 19 @ 1:23 pm
RNUG -a penny for your thoughts on this:
Would it be in any way beneficial for the state to offer immediate retirement ( under the current policy) and a part time W-2 contractor spot to willing Tier 1 employees who already meet the age/service requirement to retire? It would benefit me because I’d love to work part time. My pension would be based on my current years of service rather than additional years, and my part time salary would be roughly 60% of my full time salary. I’d also be paying more for the cost of my insurance since I’ve got less than 20 years in.

Comment by thoughts matter Tuesday, Jan 22, 19 @ 1:25 pm
Isn’t that what the 75 day program does

Comment by Anonymous Tuesday, Jan 22, 19 @ 1:45 pm
-thoughts matter-

Some questions. Are you talking about coming back under a straight personal services contract or something like the 75 day deal the 2002 ERI had or proposing a new job sharing program of some kind with no or limited benefits? Does your agency have the kind of variable workflow that they need part time help for short periods? (I’m thinking like tax season at DOR as an example) Would they need to hire a full time employee to replace you?

I agree it would stop the Tier 2 accrual but it would also start the pension payout and AAI going. It would save on GRF personnel services budget but start costing SERS. Some possible insurance savings for the State in your case. Just cost shifting, which is what the 2002 ERI did. All of the above would need to be known to guess at the potential impact / savings to the State. Hopefully the State learned from the 2002 early retirement.

Finally, an observation. Obviously, you have a minimum of 8 years to somewhere under 20 years in. While the Trail Medicare Advantage programs state retirees over 65 have to have aren’t quite as good a deal as previously, they are pretty darn good and it would make sense to last 20 if you are closr to that mark. No need to answer back on this, just giving an opinion.

Comment by RNUG Tuesday, Jan 22, 19 @ 1:54 pm
The 75 day program first, counts a day as a day whether you work 1 hour or 8. Second, I believe it’s not renewable into a second fiscal year.
Here is the real issue- you cannot get a contract offer until you’ve already turned in your retirement papers. So you have to retire and hope you get offered one. I want a contract offered to everyone eligible to retire who wants one and meets performance and discipline standards.

Comment by thoughts matter Tuesday, Jan 22, 19 @ 1:57 pm
== Isn’t that what the 75 day program does ==

Does that apply to anyone other than 2002 ERI retirees? I know the 75 day deal was put in the ERI bill because there was a flat ban on any ERI retiree directly taking a State personal services contract … not that there aren’t legal ways around that ban with a sub-contracting arrangement.

Comment by RNUG Tuesday, Jan 22, 19 @ 1:59 pm
“Your friend is gamboling.” Frankly, I think he’s more of a brass/percussion kind of guy.

Comment by Skeptic Tuesday, Jan 22, 19 @ 2:01 pm
== Second, I believe it’s not renewable into a second fiscal year. ==

It was renewal for 2002 ERI retirees. I’ve seen people go back under it for multiple years.

Comment by RNUG Tuesday, Jan 22, 19 @ 2:01 pm
== The 75 day program first, counts a day as a day whether you work 1 hour or 8. ==

True.

Comment by RNUG Tuesday, Jan 22, 19 @ 2:02 pm
RNUG - thanks - I didn’t think it actually saved the state any money, but thought you’d know for sure. I’ve seen some retirement magazine articles that say private sector companies are letting their senior employees go to a 3 day a week schedule for a few years rather than have them walk out the door. I’m several years away from my 20 and don’t intend to hang out that long( unless finances dictate). However, a part time gig might entice me to work a couple years longer than what I plan to right now. Still intending to be here for a few years.

Comment by thoughts matter Tuesday, Jan 22, 19 @ 2:07 pm
The State offers quite a few 75 day contracts to IT staff as they retire. Some for multiple years. Also PSC gigs. There is also the possibility to sub contract to the “approved vendors” consulting firms. The latter takes a good portion of your rate though.

Comment by Just A Dude Tuesday, Jan 22, 19 @ 2:13 pm
==Per an article I read earlier, our state workers get less money than the private sector for the first eight-10 years of their careers.==

Do they know SQL?

Comment by City Zen Tuesday, Jan 22, 19 @ 2:23 pm
== The latter takes a good portion of your rate though. ==

They can. Depends on what you can negotiate. You have more leverage if you pretty much bring the contract to them.

Comment by RNUG Tuesday, Jan 22, 19 @ 2:25 pm
Oh forgot to mention: At least at HFS the daily rate for a 75 day was 100% of what it was when you retired. New rule under DoIT, which will eventually encompass all of IT staff, is 80% of your rate when you retired.

Comment by Just A Dude Tuesday, Jan 22, 19 @ 2:27 pm
City Zen, what does SQL have to do with that particular comment, just curious.

Comment by golface18 Tuesday, Jan 22, 19 @ 2:31 pm
At idot. We have several 75 day retirees working who retired just a few year ago

Comment by Anonymous Tuesday, Jan 22, 19 @ 2:35 pm
== At idot. We have several 75 day retirees working who retired just a few year ago ==

== New rule under DoIT, which will eventually encompass all of IT staff, is 80% of your rate when you retired. ==

Thanks. Since it no longer affects me personally, I haven’t kept track.

Comment by RNUG Tuesday, Jan 22, 19 @ 2:38 pm
I believe 75-day program still around. There was some talk that rate of pay would be limited to 80 percent of your final pay rate.

Comment by Original Rambler Tuesday, Jan 22, 19 @ 2:41 pm
==City Zen, what does SQL have to do with that particular comment, just curious.==

What are the state workers doing compared to their private sector counterparts? Also, what is the value of their entire compensation package? Then what happens beyond year 10 in which, apparently, state workers make more than their private sector counterparts.

These are probably better questions for the original commenter: GoM.

Comment by City Zen Tuesday, Jan 22, 19 @ 3:00 pm
==Just curious about what other unions have the same type step structure==

It isn’t a question of which unions have a step structure. I’m beginning to see why so many folks don’t like Unions: it’s because they don’t understand collective bargaining.

AFSCME, to my knowledge, was the only union that didn’t agree to Rauner’s terms.

Other unions settled their contracts with Rauner and took pay freezes. They also, however, gave into that agreement based upon the contingent that Rauner also had to get that pay freeze with all other unions. If any other union got a better deal, then the state had to come back and give them the better deal.

Since AFSCME and the state never got to a deal, their prior contract remained in place from the Quinn administration. This means that Rauner was legally required to honor AFSCME’s prior agreement with the state until he reached a new one.

This is what made Rauner so colossally poor for the state. He didn’t understand (or didn’t care) that the longer he dragged out negotiations, the harder it was for him to “save” the state any money on any of his concessions.

So, to tie this all back, it doesn’t matter if the other unions have step increases, because they all agreed to step freezes, and AFSCME is owed from their prior agreement because Rauner walked away from the table.

https://www.sj-r.com/article/20150831/NEWS/150839918

Comment by MG85 Tuesday, Jan 22, 19 @ 3:01 pm
==Skeptic== oops..I swear that is what Rich’s spellchecker came up with. I spent 1.5 seconds looking at it before accepting it. I’m not clear on your definition however. Here is a 39 second clip of Gamboling..it kind of fits with what we accomplished the last four years BTW:
https://www.youtube.com/watch?v=ZKkkNtoSKS4

Comment by Anotheretiree Tuesday, Jan 22, 19 @ 3:20 pm
MG85 - thank you for that concise and clear statement.

Comment by ike Tuesday, Jan 22, 19 @ 3:37 pm
Mg85 your statement is hard to wrap my head around. A contract is a contract. Once signed that is your contract regardless of what other unions agree upon. There are at least 9 other unions that collectively bargin for their OWN group members. AFSCME bargins for their members and their members only. So…Where do the other unions stand with this agreement from Jb’s administration is still the question.
https://www2.illinois.gov/sites/TeamIllinois/LaborRelations/Pages/Change-Union-Membership-Status.aspx

Comment by Anon2 Tuesday, Jan 22, 19 @ 3:42 pm
== AFSCME, to my knowledge, was the only union that didn’t agree to Rauner’s terms. ==

In fairness to AFSCME, the State / Rauner gave much better deals to the other, much smaller (in terms of numbers), unions. AFSCME would most likely have agreed to some of the other deals that were given out.

Comment by RNUG Tuesday, Jan 22, 19 @ 3:44 pm
“In fairness to AFSCME, the State / Rauner gave much better deals to the other, much smaller (in terms of numbers), unions.”

The trades got to keep prevailing pay rates, which are pensionable, no matter how much they’d increase. Teamsters got a health insurance contribution increase.

Rauner really wanted AFSCME’s head on his wall. He thought it was going to be his Scott Walker moment, catapulting him into right wing fame. But he was such a terrible governor that it somewhat diminishes the glory of the union resisting him. It was in hindsight very easy to beat him, especially when every Democratic statewide candidate got more votes than Pritzker.

Comment by Grandson of Man Tuesday, Jan 22, 19 @ 4:09 pm
@Anotheretiree: My brain told me that a gambol was a Renaissance stringed instrument. Apparently my brain was wrong.

Comment by Skeptic Tuesday, Jan 22, 19 @ 4:12 pm
It will be fascinating to see the Pritzker AFSCME negotiations.

The Chicago Teachers Union is already planning on getting the lions share of the money in their next contact from a casino that is hasn’t been built, marijuana that hasn’t been legalized and a graduated income tax at least two years away.

I don’t think the government unions in Illinois are willing to acknowledge how severe the pension crisis is that will squeeze more money every year from Illinois residents

Comment by Lucky Pierre Tuesday, Jan 22, 19 @ 4:53 pm
I think JB will backload any contract he proposes to AFSCME with th excuse he needs to open up constitution to fund raises. That creates will for the referendum that is needed. While in they will amend clause about dominishment.

Comment by Bruce Tuesday, Jan 22, 19 @ 5:42 pm
Roman @ 1:21 ==The buy-out programs seem to be efforts to incentivize employees into making bad long-term financial decisions.==

A buy-out doesn’t save the state any money unless it is a bad decision for the employee.

Comment by Whatever Tuesday, Jan 22, 19 @ 5:58 pm
Gotcha

Comment by Hey hey Tuesday, Jan 22, 19 @ 6:39 pm
Thanks, JB, for upholding the law. Listen to Ralph Martire (so glad he’s on your team).

Comment by m4a Tuesday, Jan 22, 19 @ 6:48 pm
@- Lucky Pierre - Tuesday, Jan 22, 19 @ 4:53 pm:
Yet once again, there is no “Pension Crisis”. There _is_ a debt crisis, where that debt, along with that which is owed to the stiffed vendors was borrowed from unwilling lenders, and to which compound interest is now also owed.

Comment by Hieronymus Tuesday, Jan 22, 19 @ 7:10 pm
Lucky Pierre - You make a very good point about the theatre around the Pritzker-AFSCE negotiations. It’s going to set the tone for his administration, and I’m sure others will be watching. To your point though, I would agree - few gov’t unions seem to have the desire to accept just how deep down the rabbit hole we are.

Comment by Just an Observer Tuesday, Jan 22, 19 @ 7:12 pm
== with th excuse he needs to open up constitution to fund raises. That creates will for the referendum that is needed. While in they will amend clause about dominishment. ==

Remember, the State does not allow voter initiated changes to the vast majority of the Constitution, only to the General Assembly, and extremely limited even there.

So it is going to depend on how the General Assembly goes about modifying the State Constitution. There are two paths: one is to just put a question to modify a specific section or clause on the ballot, the other is to call for a Constitutional Convention.

It would be easier and quicker to just modify a specific clause. If you want something by 2020 or so, then the GA can simply propose repealing the flat tax and replacing it with a graduated tax. And that would be all you could put in that proposal due to the single subject rule (which the GA doesn’t always follow).

If you wanted to open up the Constitution, then the GA could call for a convention in the 2020 general election. Given the vote the last time, there is no guarantee it would pass. If it did pass, then you would have to elect delegates in another statewide election cycle (2022?) or dorcisl election, let them work out what should be changed and resolve internal differences, and put those changes up to a vote at yet another statewide election cycle. Now you are out to 2024 if not 2026. And all the while the State will be starving for revenue unless the income tax is either separately addressed.

Plus, in a Con-Con, you can’t limit what gets addressed; nothing is off limits. Get enough government employees and retirees as delegates and they could insert a clause requiring actuarially calculated payments to the pension systems ahead of everything else. Or they could change the AAI to the higher of 3% or CPI-U. If they bundled it with popular changes like in 1970, those changes could be approved by the voters.

So be careful what you wish for, you might not like the results.

Comment by RNUG Tuesday, Jan 22, 19 @ 7:43 pm
RNUG,
If I may ask your opinion, and you wouldn’t mind sharing your thoughts, what do you foresee as a time frame for state employees being placed on proper steps/ receiving back pay? Thank you.

Comment by anonymous Tuesday, Jan 22, 19 @ 8:50 pm
== what do you foresee as a time frame for state employees being placed on proper steps/ receiving back pay? ==

Had that discussion this past Sunday afternoon with a friend who is still working for a state agency.

Strictly a guess with no insider info, is up to a couple of months to get put on the proper step. I expect they will coordinate it to a payroll cycle boundary. What I don’t know is if they will do it agency by agency or all at once.

Then they will have to calculate all the back pay and the GA will have to pass an appropriation to make the back payments (unless the agencies decide to just take it out of payroll and then ask for a supplemental FY19 appropriation). No idea on how long that will take; my guess is several months after people are placed on the proper steps. But it could be that the agencies just ask for the back pay in their FY20 budget, which could delay it until Fall.

Personally, I wouldn’t look for back pay before mid-summer at the earliest. Or as my one friend joked, maybe they will get the back pay before they retire in 3 years.

Comment by RNUG Tuesday, Jan 22, 19 @ 9:29 pm
RNUG,
Thank you for your response, much appreciated. You always seem to have the correct information/ insight. I certainly didn’t expect back pay anytime soon, however was hoping that the step increases would be easy to implement.

Comment by anonymous Tuesday, Jan 22, 19 @ 10:18 pm
Clarifying my thoughts at 9:59pm …

The only way the agencies would use FY19 payroll funds and ask for a supplemental would be at the direction of the Governor’s office, and I would expect the Governor to already have a verbal deal for the needed supplemental bills.

Comment by RNUG Tuesday, Jan 22, 19 @ 10:40 pm
== however was hoping that the step increases would be easy to implement. ==

Easy in theory. But the quantity is somewhat overwhelming. And personnel / payroll will triple check everything because they don’t want to overshoot and have to do a clawback. Getting it right is more important than doing it fast.

Comment by RNUG Tuesday, Jan 22, 19 @ 10:50 pm
At age 62 mt tax guy said “if” it was me, I would take the buy out. Age 55, then, no don’t take it.

Comment by oldhp Wednesday, Jan 23, 19 @ 12:56 am
==So…Where do the other unions stand with this agreement from Jb’s administration is still the question.==

Not necessarily. Most of the other unions have “me too” clauses in them. Meaning, if someone else gets something better in that clause, then they have to be brought up to the better deal.

Yes, you are correct the contract is only bargained for the bargaining unit employees covered by the contract, but that doesn’t mean outside actions or agreements cannot affect that contract.

That said, the reason this situation impacts ONLY AFSCME employees is because ONLY AFSCME went out and fought for a better contract and Rauner, as RNUG said, decided to not give a “much better” deal as he did to other unions.

So, again, as has been the practice, in light of a new contract being signed, the prior agreement governs until otherwise. Rauner failed to do implement step increases outlined in the last agreed to contract, so AFSCME members are owed that money (plus 7% interest given this was awarded via arbitration).

Comment by MG85 Wednesday, Jan 23, 19 @ 9:26 am