Quinn says union deal will save $200M

Massive prison employee layoffs averted

[January 28, 2010]  SPRINGFIELD (AP) -- Illinois Gov. Pat Quinn's administration has struck a deal with the state's largest employees union that saves the state budget less than he hoped.

But an administration official said Wednesday that even with a budget deficit of $11 billion or more, the Democrat achieved important victories -- avoiding mass layoffs, costly litigation and setting a "tone" for future cooperation.

The American Federation of State, County and Municipal Employees agreed to delay portions of wage increases during the next year and ask members to take voluntary unpaid furloughs in exchange for avoiding most of the 2,600 layoffs Quinn sought last summer.

The layoffs were part of $1 billion in budget cuts Quinn announced in June, along with requiring all employees to take 12 unpaid furlough days to save $310 million.

But that was after Quinn sought wage concessions and voluntary furloughs from AFSCME, budget director David Vaught said.

"The governor believes we've achieved our basic objective to try to achieve savings through shared sacrifice without creating the more disruptive aspect of layoffs," Vaught said.

AFSCME filed a lawsuit over the layoffs and a judge stopped them but told both sides to work out an agreement, which they did on Tuesday.

"It protects the essential public services our members provide," AFSCME Executive Director Henry Bayer said in a statement. "Illinois families need those services more than ever in this deep recession."

The union's 40,000 members are scheduled to get two pay increases totaling 4 percent during the next year, but will give up half of that. However, what they forgo now will be due in June 2011, and earlier if the state generates new revenue, such as a tax increase. That will save $41 million, the budget office says.

The union will urge members to take up to 10 voluntary furlough days, saving an estimated $77 million. Restructuring of group insurance will save another $70 million.

About 150 layoffs remain scheduled in various agencies outside the Corrections Department. That savings takes the total over $200 million.

Vaught acknowledged that with a deficit of $11 billion or more, budget-cutting of this size seems inadequate.

But every bit helps "and you also set a tone of taking unprecedented steps, the tone of shared sacrifice, the tone of 'everybody's in this,'" he said.

Another 700 jobs remain in question as the administration continues its push to close some state facilities, notably the Howe Developmental Center in Tinley Park and the mostly unused Thomson Correctional Center, which Quinn wants to sell to the federal government to house terrorist suspects.

But most employees facing layoffs have the right to fill vacancies in other areas.

Quinn has met most of the other targets in the $1 billion in savings he announced in June, according to Vaught.

They include reducing social service grants by $250 million and education spending by $137 million, shy of the $175 million he sought there.

But the governor was shooting for $140 million in health insurance and Medicaid savings; Vaught said with a Medicaid managed-care program, savings will be over $200 million, although not all before the June 30 end of this fiscal year.

Quinn hoped to reserve $100 million, but emergency spending brought that total down to $80 million, Vaught said. Negotiations continue with other statewide officials to cut $25 million from their budgets, he said.

[Associated Press; By JOHN O'CONNOR]

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