TEXAS STATE EMPLOYEES UNION
EMAIL BROADCAST UPDATE TO MEMBERS March 4, 2011.
Legislative Update: March 4, 2011
A Tough Union for Tough Times
Balancing the Texas Budget with unfunded mandates to Texas communities
TDCJ Lay offs
First Shot fired— bill was filed to convert new employee's pension to a "defined contribution" plan
State Employee Healthcare Under Attack: Higher Premiums and Health Savings Accounts
Member Commentary: "We are all Wisconsin!"
GOP legislators call for a balanced approach to the budget despite Tea Party rhetoric
A Tough Union for Tough Times
By Derrick Osobase, TSEU Legislative Coordinator
As we're well aware public workers across the country are under attack from North to South, East to West. We all share a common bond. One thing that the massive demonstrations has shown is that state workers have been the first to step up and fight this slash and burn approach to state services. Our message isn't just about bargaining rights or protecting our benefits. It's also been about the families who we serve every day, keeping people safe and healthy, keeping the promise to our students that they can have a decent primary and secondary education, and access to an affordable college education.
As the public at large begins to wake up and see these attacks for what they are – nothing more than a right wing agenda to destroy public sector unions and public services and working people – they'll begin to turn on them and their agenda. And there are already signs of this in national polling.
But more importantly, now is the time for us to seize on this moment and strengthen our hand. It's time for us to recommit ourselves to building a union that not only protects our benefits and pay but also those citizens here in Texas, who are afraid they might get kicked out of their nursing home or the student who's done everything right but won't be able to afford college because the state cut over a billion dollars in scholarship money.
Our power is measured in numbers. It's that simple. The first step starts with you turning to your co-worker and saying, "you need to join the union so this never happens to us again. Here's an application. Fill it out. Building a strong union starts with you."
Balancing the Texas Budget with unfunded mandates to Texas communities
Lege plans to walk its tab, pass $31 million bill to counties.
The Texas Legislature has decided to solve its $27 billion problem by passing the buck. The cuts in state spending on health and human services, education, criminal justice, youth services, and many others will leave county and city governments, school districts, and hospital districts liable for billions of dollars to provide services that they will not be able to dodge.
1. Abandon seven state parks. $8 million.
One plan to reduce the state budget is to transfer responsibility for seven state parks from the Texas Department of Parks and Wildlife to the counties or cities. The seven are:
Wyler Arial Tramway (El Paso)
Big Spring State Park
Daingerfield State Park
Blanco State Park
Lockhart State Park
Sebastopol House State Historic Park (Seguin)
Lake Casa Blanca International State Park (Laredo)
While the state would save about $8 million, it would mean that the cities or counties would have to come up with funding to operate the parks. All are critical parts of the local economies, but it is unlikely that they add enough to the economy to offset the costs of operating them. Traditionally, of course, the State of Texas has taken the responsibility to operate the state parks, which benefit all the people of our state.
2. Close another TYC facility. $23 million.
Budget writers are looking to cut an additional $23 million from the budget of the Texas Youth Commission. This additional cut would require the closing of a third TYC youth facility (Legislators already had written in plans to shut down two). TYC facilities are residential placements for youth who have committed serious (felony level) crimes. Without TYC placements, cities and counties would be forced to create or expand programs and facilities to handle these youth.
What to do now.
All across the state, TSEU members are talking to county commissioners, city council members, and others about passing resolutions to oppose the unfunded mandates planned by the Texas Legislature. Contact your TSEU office or organizer to find out how to set up meetings with local elected officials where you live. www.cwa-tseu.org
TDCJ Lay offs
Last week the Texas Department of Criminal Justice announced their plan to cut more than $40 million from their FY2011 operating budget and lay off more than 550 staff. Over 400 of the layoffs come from administrative and support positions in the agency's parole and correctional institutional divisions. However, 155 of the layoffs come from the proposed elimination of Project RIO, which helps to reintegrate ex-offenders into the workforce.
Project RIO has been shown to diminish a former inmate's likelihood of returning to prison and increase their chances of holding down sustainable employment. "This move by the agency will have a big impact on public safety in Texas," said Mike Gross, Vice-President of the Texas State Employees Union. "Fewer support staff in parole mean that more parole officers will be having to do more and more with already growing case loads. The elimination of Project RIO just means we'll be seeing more offenders end up back up in prison."
This latest blow comes in the wake of the Texas Education Agency's announcement yesterday that they will begin laid off an unknown number of employees.
Governor Perry asked agencies to find an additional 2.5% to cut in FY 2011 to make up for the current $4 billion shortfall. "We're putting the public at risk with these kinds of cuts," said Gross. "This is why we need the legislature to find new sources of revenue, use the Rainy Day Fund, and maximize all federal funds. This is just the tip of the iceberg for what our state will be facing in a few months."
First Shot fired— bill was filed to convert new employee's pension to a "defined contribution" plan
This week TSEU members Lily Cisneros (DFPS, San Antonio), Jim Funk (DFPS, San Antonio), Susan Bradley (ROC, Austin), and TSEU's ERS board of trustees candidate, Bob Stewart (TWC, Austin), testified against proposed cuts to state employee retirement plans at the Senate Finance Committee hearing. Proposals to convert our defined-benefit retirement plans to defined-contribution (401-k) plans have already been filed in the state House of Representatives.
Representative Kenneth Sheets filed HB 1974 on March 2nd, which would convert all new state employee pensions to a defined-contribution plan.
What is a defined contribution plan?
It is where the employer and employee contribute each month to a 401K type account, which is invested by the employee in various stocks, mutual funds, etc. The employee's pension at retirement depends solely on the funds available in their individual account. Each individual employee accepts all the risks and hopes the investments made will be enough to provide a secure retirement.
Currently, our pension is determined by a formula that includes the employee's years of services and salary. The fund itself, and the state of Texas, accept the risk of changes in the economy and guarantee each employee a pension.
Past history of states that converted employees to defined contribution plans
Nebraska and West Virginia both converted their pension plans to defined contributions. The impact on retirees under these plans was shocking. In the case of Nebraska, workers averaged about a 6% return on their money, while the state's professional investors who managed the plans earned 11%.
A couple of disturbing things were revealed about defined contributions pans. First, employees assumed all the risks. If the stock market collapsed and lost the employee's invested money, too bad. If you didn't invest enough or your portfolio was too conservative which resulted in your account not having sufficient funds to retire – you are out of luck. In the case of West Virginia, retirees were out-living their pensions even though they were making the contributions recommended by the state's pension professionals.
Secondly, the experiment in Nebraska revealed that 401(k) type plans charge numerous fees and surcharges to the employees. Fund managers were getting rich nickel and diming employees, which lowered the total amount of funds in their accounts.
Since these debacles, both states have returned back to traditional defined benefit plans.
How does this affect you?
If Texas were to convert new employees to a defined contribution plan, the soundness of the current retirement plan would be in jeopardy. The state would have to split its contribution to the employees between two retirement funds, costing the state more money to maintain two funds and by diluting number of employees contributing to the traditional plan. Currently, all employees contribute to one fund and money is invested together.
Take Action Now! Call your legislator today and ask him/her to oppose house bill 1974 by Rep. Kenneth Sheets to convert state employees' pensions to a defined contribution plan. The benefit package for state employees is the only incentive left to attract and retain qualified state employees. We worked hard for our pension. Will the Representative oppose HB 1974?
Find out who represents you: http://www.fyi.legis.state.tx.us/
State Employee Healthcare Under Attack: Higher Premiums and Health Savings Accounts
Currently, proposed cuts to agency employee ERS health insurance would cost families an extra $135 a month in premium sharing. Currently the state covers 100% of the premiums for employees and 50% of the premium for dependents. The house budget recommends reducing that coverage. The state would only cover 80% of the premiums for employees and 40% of the premium for dependents.
Today, a state employee with ERS health care coverage for their family pays $394.60 per month in premium sharing. Under the proposed plan, employees would pay $530.42 per month to cover his or her family. This increase of $135.82 per month amounts to an annual pay cut of nearly $1630.
Just as some legislators are pushing for defined-contribution retirement plans, they're now looking to defined-contribution health plans. TSEU is standing against the consumer-directed health plans (HSA) being proposed by Rep. Crownover in HB 1766 and HB1362 by Laubenberg.
What are Health Savings Accounts?
Health Savings Accounts are tax protected savings accounts that can only be spent on healthcare expenses. In order to qualify for a Health Savings Account, state employees will have to drop out of their comprehensive healthcare plan and enroll in a high deductible health care plan.
Health Savings Accounts are bad for State Employees because:
- They impose an unfair burden on women in their child-baring years. This is because women in this age group usually utilize more routine medical exams, the cost of which can add up quickly.
- Employees enrolled in high-deductible health plans are more likely to avoid, skip, or delay health care because of cost. This often leads to great problems down the road.
- The average yearly salary of a State Employee is $38,000. Most studies show that Health Savings accounts discourage low-income workers from seeking treatment for health problems. Many state employees and retirees fit into the category of low-income workers. Health Savings Accounts have shown to only benefit more affluent employees making $75,000 and above.
- Our comprehensive healthcare plan only works if we have a mixture of employees in the risk pool. If younger, healthier, and wealthier participants opt for Health Savings Accounts, there will be fewer people in our comprehensive plan. This will shrink the risk pool, making healthcare more expensive for those who remain in a comprehensive coverage plan. At some point, the cost of comprehensive coverage could become so expensive that the state drops it altogether and no longer offers it as a benefit to anyone.
We need action now! Please call your legislator and members of the Pension, Investments, and Financial Services committee, and ask them to oppose HB 1766 by Rep. Crownover and HB 1362 by Laubenberg. Tell them that:
"Health Savings Accounts won't slow down the overall growth of healthcare costs. It will only force state employees to not seek medical attention due to the costs."
Find out who represents you: http://www.fyi.legis.state.tx.us/
Member Commentary: "We are all Wisconsin!"
Caroline O'Connor was TSEU's political and legislative coordinator and an organizer for several years. She recently began working for the Los Angeles Central Labor Council. Last week she went to Wisconsin to support the public workers there. Below is her report from the trip.
We invite TSEU members to add commentary to our Legislative Updates. Please send brief commentary on issues affecting state workers to Mimi Garcia at mgarcia@cwa-tseu.org.
Last week I went to Wisconsin for 30 hours with 160 workers from LA, representing 40 different unions. Though it was also a lot of work to organize and execute, what I was able to witness in Wisconsin was something I didn't think was possible. The people of Wisconsin literally took over their Capitol in a way that I could never have imagined and turned it into their own. It really was the most democratically run Capitol I've ever stepped foot in.
When we marched into the Capitol our first day there, it was like walking into an Iron Maiden concert in South America that included a massive drum circle. All ages. Students, workers, elderly, toddlers, moms, dudes, people with disabilities, and workers all keeping a loud and hypnotizing beat. 161 of us made our way through the crowds of cheering people into the rotunda. When you looked up, there were three levels of circular balusters draped with banners and filled with people above who were clapping and chanting "Thank you! Thank you! Thank you! Thank you!" A lot of high-fiving.
There were signs and banners everywhere! Very clever and damning handwritten signs, and union banners from across the country in support. All signs on the walls were taped with blue painters tape so not to leave a mark. I can't quite describe the feeling of walking through the center of it except that it literally took away my breath. I couldn't even chant...
The demonstrators inside the Capitol had turned it into a little town. They had food stations where free pizza, bratwursts, bagels, soup, drinks, cookies, etc...were delivered throughout the day. The sign above read, "Take what you need." That was the prevailing sentiment. If you showed up without a sleeping bag, you would be fed and given a bed on the floor so you could stay, participate, and keep the effort going.
There was a medical/first aid station staffed with volunteer nurses and med students. There was a guy that set up his massage chair and gave free massages. There was a family section of the Capitol for families and kids to play and sleep. There was a charging station for cell phones and computers where people could leave their devices and return to them fully charged.
The occupation of the Capitol was started by 2,000 graduate teaching assistants and union members from Univ. of Wisconsin Madison on Monday, Feb. 14. By Wednesday, Feb. 16, they said there were 35,000 people at the Capitol. It happened so fast. They said it was like running after a train, getting everything up and running, but they did. The TAs had a war room on the third floor north wing of the Capitol. There was a massive wall of bedding and sleeping bags available for anyone to stay the night. They had their own food and coffee station. They had a study area for students who needed it, even though it was difficult to escape the booms of the crowds and drums that came and went throughout the day. There were also signs and organizing charts and notes all over the walls with listings of movies to show at night in the rotunda, sign-up shifts for being a floor monitor, running nonviolence trainings, taking out trash, refilling food stations, handing out hand sanitizer, etc....
And everyone took turns. The students, graduate and undergrads, were the real thrust behind the organization of the Capitol takeover, along with the unions. At night, it was like a massive slumber party and everyone was invited. You could sit down on a sleeping bag island and play Apples to Apples, Settlers of Catan, or Yahtzee with a group of strangers who felt like your cousins. You could wander into several musical performances. You could watch "Bob Roberts" in the rotunda. No drinking no drugs. Everyone was told if they were going to drink, they should go home and come back when they sobered up. Everyone was really clear about the event being peaceful.
All kinds of groups would march through the rotunda during the day. There were firefighters playing bagpipes. There were med students in their white coats with a banner that read, "Future Doctors for Workers Rights and Medicaid." They chanted "Do not, do not, do not resuscitate!" (talking about the bill). There were "Cops for Labor." There were retirees for unions. There were Teamsters and Laborers. There were moms with babies in strollers. The groups would spontaneously spring up, inject the building with a new inspiration, and make their way through.
When groups like ours weren't marching in, there was an open mic in the middle of the rotunda for anyone who wanted to speak. People would get on the mic and say why they were there. The stories told and the words used were compelling and would elicit a lot of cheers. Kooky stuff would happen. Sometimes people would sing or play a song. A fifth grader got up to talk about her favorite teacher and then got nervous and ran away. One kid breakdanced. Once a yoga instructor led the entire Capitol through a breathing exercise and told everyone she would be on the second floor if anyone wanted to stretch later. A Teamster chanted "Om."
I think what struck me most was the real unity and solidarity that was in that building--union/nonunion, cops/students, old/young, hipsters/everyone else. It was really a beautiful thing and something I didn't want to leave. I must admit, I think the fact that it was happening in the heart of America, Wisconsin, the Midwest, had a lot to do with the very nice, genuine, and familial vibe that ran throughout.
Someone from our trip made a video. It's at: http://www.youtube.com/whywisconsin. You can get a sense of the LA labor folks and what it was like.
These attacks on public sector collective bargaining, organized labor and really the American middle class are spreading to six or seven other states -- including Ohio, Indiana, New Hampshire. Obviously, Texas is a state that they are looking to emulate, and many of us know how difficult it is to organize public sector workers in Texas without this right. If this is happening in a state near you, I highly recommend showing up to the demonstrations and protests. You'll actually get to participate in what democracy can look like. And you'll be continuing what started in Wisconsin and needs to spread.
GOP legislators call for a balanced approach to the budget despite Tea Party rhetoric
Sen. Robert Deuell (Greenville), Sen. Kevin Eltife (Tyler), and Rep. John Zerwas (Houston) all came out in support of using the state's $ 9 billion emergency fund known as the "Rainy Day Fund". Even though some extreme right wing legislators in the Tea Party Caucus, led by Sen. Dan Patrick of Houston, urged lawmakers in a letter to stand firm on deep cuts to state services and layoffs.
Sen. Deuell was quoted to say, "I'm advocating using the rainy day fund – All of it. I also think we should raise the gas tax 10 cents a gallon and close loopholes in the sales tax."
We need more legislators who will stand up and fight for a balanced approach to the budget that includes new sources of revenue.
TSEU members are urged to call these legislators, even if you don't live in their district. As these reasonable republicans fight for an even-handed approach to the budget that doesn't just consist of cuts, they'll need our help.
Call their offices and tell them: "I'm a member of the state employees union and a taxpayer. I support your position on using the rainy day fund. Thank you for standing up for our most vulnerable Texans."
Sen. Robert Deuell : 512-463-0102
Sen. Kevin Eltife: 512-463-0101
Rep. John Zerwas: 512-463-0657
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