Pay raises would mean budget cuts, Cayetano says

By Alice Keesing and Kevin Dayton
Advertiser Staff Writers

The governor is threatening to cut state department budgets to cover any pay raises won by public school teachers and other public employee unions.

Teachers and students display signs outside Roosevelt High School yesterday in support of teachers, who are seeking a pay raise. Cory Lum ð The Honolulu Advertiser.

Hawai'i's nearly 13,000 public school teachers voted overwhelmingly Wednesday to authorize a strike, which could come April 5 unless there is a settlement of their contract. University professors could authorize a strike next week.

Gov. Ben Cayetano has repeatedly said the state does not have the money to give the unions what they want and, in a memo, has ordered department heads to prepare for cuts ranging from $45 million to $230 million in fiscal 2002 in anticipation of any raises.

The state House, however, has already made plans to impose just the sort of budget cuts Cayetano warns of in his memo.

The financial plan Cayetano submitted to the Legislature proposed the state spend $1.1 billion more out of the general treasury over the next two years than the state spent this year. But Cayetano included no money for public worker raises.

The House rejected that approach. House leaders made it clear they intend to pay for public worker raises and trimmed Cayetano's two-year budget request by $243 million. Those cuts were designed in part to free up money for raises.

Even after those cuts, the House is still proposing spending $356 million more next year than this year. The proposed House budget for the following year is $500 million more than general treasury spending for this year.

Hawaii State Teachers Association executive director Joan Husted said, based on the union's analysis of the state budget, the cuts proposed to pay for raises are unnecessary.

"The governor is engaging in an organized campaign to paint the unions as bad people who are going to rob money away from other organizations in the state," she said. "It's part of an orchestrated campaign to break the unions during these negotiations."

At a Board of Education meeting last night at Kalaheo High School, board member and former state senator Donna Ikeda questioned the move by Cayetano to have departments prepare for cuts.

"Frankly I see this as a ploy," she said. "I can fully understand why it's being done, but I think it's very unfair."

Under the governor's scenario, the Department of Education could end up losing resources to pay for raises. If the unions were to accept the contract offers the state has made, the DOE would have to come up with $5 million out of a total $55 million cut statewide for fiscal year 2002.

If the unions received what they are requesting, the DOE would need to contribute $21 million of a total $230 million cut.

"I'm sad to see these kind of figures being used as leverage for people to back off their support of teachers," Ikeda said.

Seventeen other state departments also would be required to trim their budgets.

Board Chairman Herb Watanabe said the board will stand firm in its support of a teacher pay raise.

The state is proposing to raise the starting pay of teachers from $29,204 to $35,070, and to boost the top-end scale by $6,000, to $64,202, which the governor says will address concerns about recruitment and retention and leave enough money for the state to buy textbooks and improve facilities.

HSTA has proposed raises of up to 22 percent.

With its strike vote, the union set the stage for a showdown. Hundreds of teachers waved signs yesterday to gain support.

After teachers gave nearly unanimous approval for a strike, the union began preparing them for the realities of a walk off. Union officials are busy answering members' questions about matters including finances and health insurance.

"There are a lot of scare tactics going on by some Department of Education people who are saying some things like if you die on the picket line you loose your ... retirement death benefits," said union executive director Husted.

At a meeting with Advertiser editors and reporters yesterday, Cayetano acknowledged he may get the blame if public school teachers go on strike next month. But he said he is pressing for concessions from the teachers' union for the long-term benefit of the public school system.

"One of the not-so-desirable perks of this job is that you do get blamed for anything that goes wrong in this state, whether it's the economy or anything else," Cayetano said. "There's no question there is public sentiment on the side of the teachers. The question is, how much? How much do you give?"

State Director of Finance Neal Miyahira estimated the proposal by the teachers' union would cost the state about $125 million a year, and the most recent administration proposal would cost the state $48 million a year.

The administration proposal to the teachers would also limit the pay increases teachers receive based on seniority, instead substituting new pay incentives to reward professional development, national certification and continuing education.

Cayetano asked: "Do you think you can improve education just by raising teachers salaries? I don't think so."

Unless the state is willing to raise taxes, Cayetano said raises on the order of those sought by the teachers union will force cuts in social services and other programs.

Cayetano said the state was able to give teachers and others raises in the 1990s by raiding special funds — accounts where money had been set aside for things such as road maintenance — by reducing contributions to the public employee pension fund, and through accounting tricks such as the payroll lag.

"Well, I'm not going to do that again," Cayetano said yesterday. "That's the way I feel. I think we need to have a balance.

"When I read editorials about public sentiment being on the side of the teachers, I don't doubt that for a minute. What we're talking about is how much can we afford, because, myself, I want to give the teachers a pay raise, and if I could give them a bigger pay raise, I would because I think that's really important."

Cayetano said the public school system also needs new schools, renovations to old schools, new computers, textbooks and instructional materials. All of those items were included in his spending proposals for the next two years.

Cayetano said he wouldn't yield to the threat of an April 5 walkout and reaffirmed his position that the state has no room to budge.

"I expected the heavy strike vote, because there has been little discussion by the HSTA leaders about the state's offer," Cayetano said in a statement released by his office. "HSTA spent hundreds of thousands of dollars in raising the expectations of its members.

"Some teachers are demanding we raise taxes," he added. "Emotion, rather than reason, is ruling."