Faced with either borrowing another $250 million or laying off workers, the Senate Committee of the Whole and union leaders hunkered down Friday to discuss where to trim the fat, but parted ways when it came to who to let go.
The hearing came on the heels of the Senate’s recent decision to hold the vote on a proposal authorizing the government to borrow up to $500 million to plug current and future funding gaps that officials have said would seriously impact government operations.
Local union leaders made clear their opposition to the proposal, saying that it would pile more debt on workers and came up with a long list of suggestions they said could bring some relief.
"I see where we can save millions in the public schools, where we can bring people out, but no one wants to listen to us," St. Croix’s American Federation of Teachers President Tyrone Molyneaux said Friday. "People are sitting in their offices collecting $80,000, $90,000, but don’t produce anything. Now, we can give you that information, but the question is what are you going to do with it?"
Apparently, the catch was that the layoffs or salary cuts wouldn’t apply to unionized employees — which many said either go years without a pay increase, or receive one every year, depending on the pace of collective bargaining negotiations — but rather top officials and unclassified or exempt workers.
Silence briefly filled the legislative chambers on St. Thomas when Senate President Louis P. Hill — who said he would support a pay cut for senators and other leaders — asked whether unproductive union employees should also get the boot. Then, one by one, most of the testifiers shook their heads.
"Not fire them…but find them productive work, and if they don’t do it, then don’t pay them," Molyneaux said. Others added that "cutting from the top" could save at least $2 million, and in the current economic climate — where the cost of living is high and jobs are scarce — layoffs and furloughs should be a last resort.
In a letter sent to Hill Friday, Gov. John deJongh Jr. said the government has paid out $56.3 million in salary increases since January 2007: $52.5 million to classified union employees; $601,270 to classified non-union employees; $721,244 to part-time employees; and $2.5 million to exempt employees.
"I hope that this puts to rest the erroneous information spread about increases to exempt employees and that even in these difficult times we have tried to address the salary concerns of our employees," deJongh wrote.
Union leaders explained during Friday’s hearing that their experience at the government’s negotiating table over the years is what shaped their position, which some senators also described as "contradictory." Most of the government’s budget is eaten up with personnel costs, and while the workforce is already hundreds less than it was a few years ago, costs have continually increased because of salary hikes, some senators said.
But Molyneaux explained that the government already has the authority to freeze the increases, and has done so repeatedly over the years, when financial crisis after crisis has kept government workers from getting their full paychecks. The freeze is in place by default — sometimes for up to five years — because the government doesn’t have the money or doesn’t set the time or place for the negotiations, he said.
"And if we’re talking about increases based on performance — just about all the unions have that language in their contracts," he added. "Now, the question is, are the managers and administrators doing that part of their job."
The unions have already done their part, and it’s now time for the government to lead by example, many said.
All in the room supported having some kind of forum or public meeting where all proposals for cost cutting measures could be laid on the table.
On the unions’ side, suggestions included:
- refinancing all of the government’s current debt and paying it off over an extended period of time;
- creating new revenue streams, such as a cigarette or "sin tax," to bring in more revenue;
- going after federal subsidies;
- creating a government complex to cut back on rent paid by departments and agencies;
- raising the hotel occupancy tax;
- and reassessing agencies such as the V.I. Port Authority and West Indian Co. Ltd to make sure they’re operating efficiently.
Senate Minority Leader Usie R. Richards came out with a long list of suggestions from the caucus, including:
- reducing the salaries of non-unionized and exempt employees in all branches to $60,000;
- cutting the salaries of senators, territorial court judges, the governor and lieutenant governor by 10 percent;
- making employees authorized to use government vehicles on a 24-hours basis pay for their own gas and maintenance;
- and cutting the hours of unclassified or exempt employees hired after November 2002, among other things.
Many senators also said that employees are still being hired despite the current freeze, and suggested that a "real" moratorium on new hires be instituted.
In his four-page letter to Hill, deJongh countered the allegations, saying that the government has had success with its hiring freeze and attrition program, where positions left vacant by retirees have either been cut or remain unfilled. Since the program started in 2008, about 820 employees have left the government, saving $51.9 million, he wrote.
In the meantime, 517 new employees were hired at Education, the V.I. Police Department, Corrections, Human Services, Health, and Justice at a cost of $24.1 million — still a savings of $27.8 million, deJongh said.
"The success of this program is a significant factor in our being able to avoid layoffs of government workers, and have enabled us to reduce our operating budget by $15.3 million in FY 2009 and $12.1 million so far in FY 2010, with additional savings of $2.5 million projected for the remainder of this fiscal year," the governor wrote.
The Senate is expected to vote on the borrowing proposal during a session scheduled for May 4.
Present during Friday’s hearing were Sens. Craig W. Barshinger, Adlah "Foncie" Donastorg, Carlton "Ital" Dowe, Neville James, Wayne James, Hill, Terrence "Positive" Nelson, Nereida Rivera-O’Reilly, Richards, Sammuel Sanes, Patrick Simeon Sprauve, Michael Thurland and Alvin L. Williams.
