Legislative debate begins over funding employee compensation

DES MOINES — Now that new two-year collective bargaining contracts have been set with unionized state employees, the question at the Statehouse turns to how do Gov. Terry Branstad and the split-control Legislature fund the pay increases and benefit packages through June 30, 2017.

The debate got off to a rocky start Tuesday when Sen. Tony Bisignano, D-Des Moines, chairman of the Senate Labor and Business Relations Committee, took to the Senate floor to call Branstad 'a disgrace' for not proposing a bill to fund the increased employee compensation costs in his fiscal 2016 budget plan and signaling that he would expect government agencies to pay for raises by absorbing costs within their spending allotments and using attrition or other means to balance their ledgers.

'It's indirectly not bargaining in good faith,' Bisignano said of the governor's position. 'To bargain a collective bargaining agreement with no intention of paying is bargaining in bad faith. We can't continue to bargain contracts with no intent of making good and coming through the back door and laying people off.'

Bisignano's strongly-worded speech was interrupted twice by Senate GOP Leader Bill Dix of Shell Rock, who accused the Des Moines Democrat of impugning the six-term Republican governor in violation of Senate decorum. 'We are the Legislature. Those decisions can still be dealt with and there's no point in questioning the motives of our governor,' he said.

According to the state Department of Management, the new contract with the American Federation of State, County and Municipal Employees (AFSCME) Council 61 will cost the state general fund more than $49 million in fiscal 2016 and nearly $43.6 million in fiscal 2017. Similar agreements with smaller unions carry a price tag of $7 million in fiscal 2017 and $5.5 million the following fiscal year for Iowa United Professionals (IUP), and $1.8 million in fiscal 2016 and $1.9 million in fiscal 2017 for the State Police Officers Council (SPOC), according to DOM estimates.

Branstad spokesman Jimmy Centers said Tuesday no decision has been made whether to apply the contract provisions to noncontract employees in state government as happened in some past years. But if that were to happen, the new costs to the state general fund for fiscal 2016 would be an additional $49.5 million while the number would grow to $51.6 million in fiscal 2017, according to DOM projections.

Current costs for salaries and benefits woven throughout various executive-branch agencies of state government and regent institutions total just under $4 billion for all state funds and nearly $2 billion just within the state's general fund, according to DOM figures. Estimated general fund costs for fiscal 2016 before the new contracts were struck totaled $1.036 billion for noncontract-covered state employees, $786.4 million for AFSCME-covered workers, nearly $104 million for IUP bargaining unit employees and nearly $41.8 million for SPOC members.

Collective bargaining units generally will be receiving across-the-board pay increases totaling about 6 percent over the next two fiscal years. Many state workers will be paying 20 percent of their health insurance premiums with an incentive to lower costs by participating in a wellness program, but AFSCME-covered employees will pay a minimum of $20 per month in health insurance premiums based on a binding settlement decided last weekend.

'By asking the AFSCME union members to contribute to their health care, something the union hadn't done before which led to Iowa taxpayers picking up the full tab, Gov. Branstad and Lt. Gov. Reynolds offered a good-faith, fair proposal to AFSCME employees that was in the best interest of Iowa taxpayers,' Centers said.

Iowa State Collective Bargaining Costs FY16 & FY17 (PDF) Iowa State Collective Bargaining Costs FY16 & FY17 (Text)