Seeking savings, N.H. Senate budget writers look to cut state personnel costs – again
Democrats and the State Employees’ Association are warning that hundreds of state workers could be laid off under the Senate Republicans’ draft budget, which requires Gov. Maggie Hassan to find $50 million in personnel savings over the next two years.
If this seems familiar, that’s because it should. The 2011 state budget required then-Gov. John Lynch to find $50 million in personnel savings over the biennium. And in 2009, lawmakers ordered Lynch to cut $25 million in state employee compensation and benefits in order to balance the budget.
“We had to take that personnel cut to make those numbers work,” said Sen. Chuck Morse, a Salem Republican and chairman of the Senate Finance Committee.
But this time, there are fewer vacant positions at state agencies that could be eliminated to soften the blow, said Senate Minority Leader Sylvia Larsen, a Concord Democrat.
“They didn’t specify who should be laid off, or even what department. Instead, they are demanding the governor make that difficult decision,” Larsen told reporters yesterday. “They’re passing the buck – ducking, dodging, darting and diving away from the hard choices. This reckless move will cost hundreds of New Hampshire workers – taxpayers, mothers and fathers – their jobs.”
The proposal has surfaced as the state negotiates new contracts with four unions representing state workers: the SEA, the New Hampshire Troopers Association, the New England Police Benevolent Association and the Teamsters.
But the SEA’s president, Diana Lacey, said she doubts the Senate’s proposal will have much effect on negotiations that began in January.
“These cuts have come up at the 11th hour and 59th minute,” she said.
Hundreds of jobs?
The Republican-led Senate will vote Thursday on the two-year, $10.7 billion budget endorsed by the Finance Committee last week on a party-line vote.
The Democratic-led House passed its own $11 billion budget in April. Negotiators from the House and Senate are expected to hammer out a final version in a committee of conference before the current biennium ends June 30.
The Senate’s draft budget increases spending in many areas from levels in the current budget, and keeps funding level with the House’s budget in areas like mental health services, the University System of New Hampshire and community colleges. Critics have said it leaves a $40 million hole in the Department of Health and Human Services’s budget.
The Senate’s budget writers also added a clause requiring Hassan, a Democrat, to reduce spending on benefits and compensation for classified state employees by at least $50 million over the next biennium, including at least $20 million in savings to the state’s general fund.
Morse said the Senate’s proposed budget spends more than the current budget does without increasing taxes or fees. The personnel cut, he said, was necessary to balance the books.
The SEA warned last week that the $50 million cut could mean 700 jobs eliminated, or a $5,000-per-employee reduction in total compensation. Hassan spokesman Marc Goldberg said that if the entire $50 million reduction came through eliminating positions, it would mean cutting 400 to 700 jobs. (He didn’t say how many state positions are currently vacant.)
Aside from eliminating jobs, personnel costs could be reduced through changes in pay and benefits. The state is in the midst of contract negotiations with four unions representing state workers, the largest being the SEA.
Lacey said those talks are continuing, though she couldn’t say how close they are to a deal. But, she said, state workers have gone years without a pay increase while paying more for their insurance and pensions.
“There’s no reason to think that the $50 million is going to end up being part of the conversation,” Lacey said.
Matt Newland, the state’s manager of employee relations, didn’t return a message yesterday seeking comment.
Cut, cut, cut
An across-the-board personnel cut isn’t a new idea.
In 2011, the Republican-controlled Legislature’s state budget mandated a $50 million personnel cut, with $20 million to come from general-fund spending. Lynch’s office warned at the time of 500 layoffs, but those were largely avoided thanks to savings from new collective bargaining agreements and the use of one-time reserve funds.
Two years earlier, the Democratic-controlled Legislature required a $25 million across-the-board cut in personnel costs, all from the general fund. Layoff notices were sent to 250 workers, though the number actually laid off was somewhat lower due to retirements and the like.
Senate President Peter Bragdon, a Milford Republican, pushed back yesterday on Hassan’s criticism of the Senate’s proposed cut by citing the 2009 cut she had supported while serving in the state Senate.
“That sounds like she was for it before she was against it,” Bragdon said in a statement.
But over the last few years, Larsen said, commissioners have been able to soften the blow of staff cuts by eliminating empty jobs that were still funded in the operating budget.
“Now those vacant positions that were funded are not there, and so to make cuts will require layoffs and cuts in programming,” Larsen said.
“It’s bare bones already. . . . There’s no cushion anymore,” she said.
(Ben Leubsdorf can be reached at 369-3307 or
email@example.com or on Twitter @BenLeubsdorf.)