Pennsylvania employees’ unions suggest ways to cut state budget

From the Patriot News:

State labor unions want legislators to know there are alternatives to the sweeping cuts they anticipate seeing in Gov. Tom Corbett’s budget proposal.

There are efficiencies that can be found. There are tax loopholes that can be closed. There are ways to enhance revenue without raising taxes. 

In their view, the consequences of their ideas are not as horrible as the funding cuts to education and social services that they see on the horizon in the governor’s budget, which will be unveiled Tuesday. 

Labor groups also are anxious to protect union jobs in Corbett’s 2012-13 budget. 

Nine unions that represent mostly state, school and university employees — organized under the name Coalition for Labor Engagement and Accountable Revenue — will discuss their plan to save the state nearly $2.4 billion at a Capitol news conference today. 

“If this is going to be a tough budget, then before we start slashing a lot of areas, let’s look at stuff that makes sense when it comes to running state government,” said coalition chairman David Fillman, executive director of the American Federation of State, County and Municipal Employees Council 13. 

The coalition’s list of 18 not-so-new ideas are borrowed from the governor himself, as well as Auditor General Jack Wagner, state lawmakers and other states. 

The ideas include: the imposition of an excise tax on natural gas drillers; eliminating the 1 percent discount vendors receive for collecting the state sales tax; and closing the loophole that allows companies in Pennsylvania to avoid paying state taxes by setting up some operations in Delaware. 

While the ideas haven’t gained much traction, coalition leaders suggest that given the pain that Pennsylvanians are feeling from the economy and recent budget cuts, perhaps their time has come.

“Wake up. Wake up and look at the economy. Wake up and look at the people who are in need in Pennsylvania. We need jobs. We need people to be employed, and here are ways to do that,” said Kathy Jellison, president of the Service Employees International Union Local 668. 

Dan Egan, a spokesman for the Corbett administration, said the unions have not provided the administration with any detailed or specific recommendations, but it is open to reviewing and considering ideas to save tax dollars. 

Among the ideas that haven’t gotten much attention in recent years is taking a look at the ratio of nonsupervisory state employees to management employees. 

Right now, there are 4.58 workers to every manager. 

Raising that by one — to 5.58 workers to 1 manager — would produce a savings of $214 million annually, the coalition says. 

Pushing that to 9.58 workers to every management employee could drive up the savings to $625 million a year, it estimates. 

“The number of managers that we have on a ratio to the rank-and-file they manage is an extremely low number when you look at other states and what is a management norm,” Fillman said. “There’s something that is not right with this scenario, and it’s something that should be rectified to save a lot of money.” 

The same goes for looking at state contracting practices, he said. 

“There are tons and tons of contracts out there that just get renewed on a regular basis. … and should be looked at to see if bringing them in-house is cheaper,” Fillman said. 

Coalition leaders said that some of their ideas are heavy lifts politically, but the alternative is another year of cuts to programs and services that Pennsylvanians can’t afford. 

“We have long-term solutions to these problems but … [Corbett’s] just looking to get by until the next year,” Jellison said. “That’s not good enough.” 


Among the coalition’s ideas to cut more than $2 billion in state spending: 
Improve state tax collections — $30 million 
Reduce prison costs — $60 million 
Cut Medicaid provider fraud and abuse — $60 million 
Consolidate the state’s prescription drug purchases — $50 million 
Modernize state liquor stores — $75 million