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The Honolulu Advertiser
Posted on: Sunday, November 17, 2002

Lingle's first test may be public workers' contracts

By Kevin Dayton
Advertiser Capitol Bureau Chief

Once again, negotiations with Hawai'i's public employee unions are looming in a year when the state is short of cash, and that convergence could spell an early end of the honeymoon for Gov.-elect Linda Lingle.

Last year, University of Hawai'i faculty called a strike in a contract dispute over wages and conditions with Gov. Ben Cayetano.

Advertiser library photo • April 12, 2001

The contracts for about 57,000 state and county public workers are scheduled to expire June 30, and the two-year budget Gov. Ben Cayetano is drafting to submit to the state Legislature next month will include no money for raises.

Cayetano has repeatedly warned the unions there is no money for a new round of raises, and the scenario presents a serious early challenge for Lingle.

"The contracts that we agreed to last year totaled nearly $200 million per year, and each year it will go up because the base will increase," Cayetano said last week. "Unless the Council on Revenues estimates a dramatic increase in revenues, it will be difficult to find the money."

Lingle has expressed confidence that she will quickly be able to find millions of dollars for new initiatives without laying off workers or reducing services, and the upcoming budget cycle will quickly test that claim.

Even without including raises for the unions, Cayetano said he had to dip into the hurricane relief fund for an extra $200 million to balance the budget, a step that Lingle said she opposed.

During the campaign, Lingle also came out forcefully against reducing state and county contributions into the public worker pension fund as a method of balancing the budget, a practice the Lingle campaign said amounted to a "raid" on the pension fund. That is another tactic Cayetano and lawmakers have used to pay for public worker raises.

"It's going to be a big problem for her, especially since she's pledged not to use the hurricane relief fund," Cayetano said of the upcoming negotiations.

Lingle said last week she has no strategy yet for dealing with the union negotiations, but added that, "I think it's made somewhat easier by the financial condition of the state right now," implying that it will be difficult for the unions to argue that the state is in a position to offer more money.

Lingle noted that last year lawmakers cut money for the governor's office, cut the budget for the transition between administrations, took $29 million from the hurricane fund and "really cobbled things together so they could get a budget that they could call balanced this year. So, it's going to be a tough challenge for us," she said of the negotiations.

When asked if she thinks there is money for public worker raises, Lingle replied: "I think it's much, much too early to think about that right now."

The last round of negotiations culminated with strikes by the public school teachers and University of Hawai'i faculty in 2001, but winning raises wasn't easy for any of the unions.

For the Hawai'i Government Employees Association, its members received no raises in the two years beginning July 1, 1999. An arbitrator then awarded union members' raises ranging from 12 percent to 17 percent over this year and last year, but Cayetano argued the arbitration award was illegal and initially refused to honor it.

Cayetano finally agreed to pay the raises for this year and last year after the union agreed to reduced vacation and sick leave benefits for new hires.

The United Public Workers union reached a similar agreement with the state that resulted in two years of no raises, and raises for 2001 and 2002, along with reduced vacation and sick leave for new hires.

The reduced sick leave and vacation benefits will be an issue this year, especially because other public unions were not forced to accept similar reductions in benefits, said Russell Okata, executive director of HGEA. Okata said his union is waiting to see if Lingle will try to impose similar benefit reductions on the other public employee unions.

"If they're not going to treat us equally with every other public employee, you're going to have a fight from the HGEA negotiating team and myself personally," Okata said. "I'll be damned if we're going to take the hit to make government more efficient and cost competitive, and the other public employees are not treated equally."

HGEA has been in negotiations with the state and counties for months, but Okata said government negotiators have refused to hold any meaningful talks about cost items such as wages.

"They have not shared any information regarding the budget, and said they were leaving it to the next administration," he said.

Referring to Lingle, Okata said the negotiations are "her opportunity to win over the public employees, because they are looking for a leader who will obviously consider their points of view."

"I always think that there's money for raises. It's where the state wants to put its priorities," he said. "But if you cut taxes, certainly there won't be too much money for raises."

Joan Husted, executive director of the Hawai'i State Teachers Association, said an initial discussion between Lingle and HSTA leaders was friendly, and Husted said she hopes the new governor will support pay increases for teachers as the educational system tries to cope with teacher shortages and other issues.

The union contends pay is important in attracting and retaining teachers. The union has said teacher salaries in Hawai'i are the lowest in the nation when the state's cost of living is figured in. State officials have said Hawai'i's pay is not the lowest, that its benefits are generous, and that consumer prices have been flat over the past decade.

"Our own economic projections tell us that the state will have money for the kinds of pay increases we're going to be looking for, so no, we don't believe the state is flat broke," Husted said. "Our data clearly does not show that. It's not rolling in money, either. But the question has to be, what price is this community going to pay for empty classrooms?"

At the University of Hawai'i Professional Assembly, one of the few unions to endorse Lingle, executive director J.N. Musto predicted negotiations will move more smoothly than they have under Cayetano.

Lingle seems to have a good idea of the level of public support the university needs, while University President Evan Dobelle has cited faculty pay as "the No. 1 issue," Musto said.

"It's always a challenge, and it has been forever. And I don't think that that's going to change, but I think that we may be entering a new era of civility in collective bargaining, at least as far as the university and UHPA are concerned," Musto said.

Advertiser reporter Johnny Brannon contributed to this report. Reach Kevin Dayton at kdayton@honoluluadvertiser.com or 525-8070.