NEWS

Notable points from the Governor’s State Budget Report 2017-2018

On January 10, 2017, Governor Brown released his proposed 2017-2018 State Budget. Once again Brown emphasized “budget prudence” by reiterating “deficits are always much larger in magnitude than surpluses.” Brown continues to discourage spending money on programs that improve the lives of Californians and restoring programs that were once cut.

In the big picture, the Governor’s budget proposes $122.5 billion in General Fund expenditures, a slight reduction from the 2016-2017 budget. It also assumes an increase of $5.2 billion in General Fund revenues compared to last year. Over the course of the next three fiscal years, the 2017-18 budget assumes a $1.6 billion deficit in the next budget year and $1 to $2 billion deficits in future years, if left unaddressed. In addition, the Administration socked away another $1 billion into the Proposition 2 rainy day fund to pad the nearly $8 billion balance and prepare for future deficits.

>> Click here to read the full article that includes in-depth content on...

• State Employee Compensation
• State CalPERS Contribution
• Civil Service Reform
• State Employee Position Increases, Funding Proposals

SEIU Local 1000 Members Approved New Contract

The votes are in and according to SEIU Local 1000, approximately 90 percent of the the people voted in favor of the new contract. The 42-month contract promises members a $2,500 bonus and a cumulative raise of 11.5%. The next step is ratification of the Legislature before the 96,000 state workers represented by SEIU Local 1000 receive their bonus checks.  

>> Click here to read the full article from the Sac Bee.

CalHR Pay Letter Affects Pay Scales for Some Excluded Employees

CalHR released Pay Letter 16-24 on December 22, 2016, which addressed changes in the Fair Labor Standards Act salary threshold. Some excluded employees received an increased pay rate. 

>> Click here to read the details of Pay Letter 16-24 to see if your classification was affected by this change. 

CalPERS Lowers Investment Funds Discount Rate

On December 21, 2016, the CalPERS Board of Directors Investment Committee approved a reduction in the discount rate from 7.5% to 7.0% over a three-year phase. CalPERS financial consultants have been concerned about the current state of negative cash flow over the next 10 years. Lower returns in early years will diminish the compounding interest of later years. According to Reuters, “State and local governments could see their pension contributions rise by as much as $2 billion in five years. But for employees, the hit could be another percentage point or more in payroll deductions.” CalPERS views this reduction in the discount rate as a necessary way to improve its current situation.

This means that state employees will be paying more towards their retirement benefits in the long run as a direct result of the discounted rate. The state needs to protect the pensions. To cover that, state employees will end up having to pay more from their current paychecks towards their retirement benefits. At this point, we do not know exactly how much will come out of employee paychecks.

"This was a very difficult decision to make, but it is an important step to ensure the long-term sustainability of the Fund," said Rob Feckner, president of the CalPERS Board of Administration.

The new discount rate for the state will go into effect on July 1, 2017 at 7.375% and then be phased down incrementally to 7.25% for Fiscal Year (FY) 2018-19 and the again phased down to 7.0% for FY 2019-20.

ACSS will continue to follow this issue closely and provide you with updates that affect excluded state employees.

>>Click here to read the full article from CalPERS.

State Treasurer Chiang Attends Sacramento ACSS Chapters 502 and 503 Member Appreciation Party

California State Treasurer and 2018 Gubernatorial Candidate John Chiang attended and spoke at the Chapter 502 and 503 Member Appreciation Meeting and Dinner in Sacramento on December 2nd 2017.

Chapter 503 President, James Teahan, was ecstatic to have Chiang attend. “John Chiang was fully engaged with ACSS members, gave a terrific speech, and truly provided his support for ACSS. We were so happy to have him as this was the first time a State Officer attended our Membership Appreciation Event,” Teahan noted.

Chapter 502 President, Lieutenant Coopwood, found Chiang very approachable and personable. Coopwood enjoyed listening to the State Treasurer’s anecdotes about family, his background, and history with Governor Schwarzenegger. Coopwood commented that Chiang’s speech “showed how he is willing to fight for the rights of ACSS members and not just go along with the status quo.”

In addition, ACSS Vice President Elnora Fretwell said, “Chiang’s personal stories really connected with the crowd.”

Overall, the presence of Chiang at the Member Appreciation party was extremely well received by ACSS officers, members and their guests. ACSS thanks State Treasurer Chiang for spending time with us and supporting us in our efforts.

Top row from left: Chapter 502 President Lieutenant Coopwood, ACSS President Frank Ruffino, State Treasurer John Chiang, Arthur Anderson, Chapter 503 President James Teahan.
Bottom row from left: ACSS VP of Membership Development Arlene Espinoza, ACSS Secretary/Treasurer Pam Robison, Chapter 502 Secretary/Treasurer Lori Anderson.

Paid Leave Buy-Back Program Enhanced – Options for Savings Plan or Cash Payout

The California Department of Human Resources (CalHR) has authorized an enhancement to the Paid Leave Buy-Back Program for fiscal year 2016-17 in PML 2016-032. Employees designated as Exempt, Managerial, Supervisory, Confidential, or otherwise excluded from collective bargaining are able to participate. If an employee has vacation or annual leave balances in excess of 640 hours as of December 1, 2016, the employee has the option to transfer accruals into a Savings Plus 457(b) account, transfer accruals into a 401(k) account, or request a cash payment. This enhancement to the Excluded Employee Leave Buy-Back Program allows employees another option when using the 80 hours of leave buy-back proposed and obtained by ACSS in April 2016.

Eligible employees can elect to participate by completing the Transfer Future Leave Accruals to Savings Plus form and returning it to Human Resources by December 31, 2016. No action is required if you do NOT elect to participate.

For more information, download the FAQ provided by CalHR.

Two Excluded Employees Win Prizes for Joining ACSS in 2016!

In September and October of 2016, ACSS held a six-week promotional membership drive to encourage supervisors and managers to join ACSS. Two new members who submitted membership applications during the sweepstakes period were selected at random as winners.

Curtis Scribner won a GoPro Hero video camera and is now a member of ACSS Chapter 502. Scribner is a Maintenance Superintendent at the Department of Transportation (CalTrans) in Olivehurst. He joined ACSS because he had talked to other CalTrans supervisors who were very satisfied with their membership with ACSS and they encouraged him to join. Scribner said “it was time to join” to support ACSS in the fight for better pay for supervisors and managers.

Marilyn Bradford won a 40-inch Samsung Ultra HD Smart TV and is now a member of ACSS Chapter 504. Bradford is a Manager I at the State Compensation Insurance Fund (SCIF) in Vacaville. She joined ACSS because she had witnessed her co-workers experiencing difficult situations in their job and saw how ACSS supported and represented those members. She says, “By joining ACSS, I am protecting my best interests.” 

Chapter 504 Board Member Shirley Castaneda (on left) presented Bradford with the prize.

ACSS congratulates Curtis and Marilyn on winning the 2016 ACSS Membership Drive Sweepstakes and welcomes them as new members of ACSS.

Rank and File reach a Tentative Agreement and Pay Raise – How this Affects Excluded Employees

Over the past month, ACSS has followed the bargaining between California’s largest union of state employees (SEIU Local 1000) and the State of California over a new contract. We have also been following the reports on the possibility of a strike and how the State of California sought to halt the potentially disruptive strike by seeking an injunction against SEIU Local 1000 employees. The Brown administration has been arguing that the potential strike would be illegal because of the no-strike clause. On Friday December 2nd, 2016, SEIU Local 1000 announced that the strike, set for December 5th, had been called off.

Over the weekend, a tentative agreement had been reportedly reached between L1000 and the state. As reported by SEIU Local 1000, the new tentative agreement includes:

• A $2,500 one-time signing bonus
• 11.5% GSI total spread over 3 years: 4% effective 7/1/2017, 4% GSI effective 7/1/2018 and 3.5% GSI effective 7/1/2019.
• Only 2.3% total in prefunding contributions for retirement health benefits over those 3 years
• Special salary adjustments in over 30 classifications

ACSS will review and analyze the tentative agreement. We plan to reach out to CalHR to discuss the impact of this potential agreement on excluded employees related to SEIU Bargaining Units. ACSS is following this issue closely and will continue to bring updates to managers and supervisors who may be affected by it.

Legislative Analyst’s Office Predicts Uncertainty Yet Preparedness in Future Budget Outlook

On November 16, 2016, the Legislative Analyst’s Office (LAO) released a comprehensive report on the assessment of the condition of the California economy and budget over the 2016-17 through 2020-2021 period. While the report predicts unpredictable economic conditions ahead, the report also provides a positive budget outlook and describes how the state is prepared to withstand a mild recession in the future.

Assuming that the state makes no additional budget commitments, the report estimates the state would end up with a decent amount of reserves. Of the $11.5 billion in estimated reserves, $2.8 billion would be set aside for discretionary reserves, which the Legislature can appropriate for any purpose.

In the event of a mild economic downturn scenario, the LAO estimates the state would have enough reserves to cover almost all of its operating deficits through 2020-21 without cutting spending or raising taxes.

These estimates are under the assumptions that the state does not make any changes in current policies or programs during the outlook period, and assumes no new changes in federal policy. The future is uncertain and any unforeseen future changes could have significant impact on the budget outlook.

>>Click here to read the full report from the Legislative Analyst’s Office on the Budget Outlook.

ACSS Endorsed Candidates – Election Results November 2016

ACSS Legislative Analyst Ted Toppin describes the results of the election in regards to ACSS-Endorsed Candidates. Overall, our ACSS-Endorsed Candidates had a tremendous amount of success.

For ACSS, the state election results were pretty spectacular. The ACSS-endorsed legislative candidate won in 80 of the 82 races in which ACSS took a position. The one ACSS-supported ballot measure – Proposition 55 (Tax Extension for Education) – passed easily.

In the Assembly, the ACSS candidate won in 63 races and lost in two. In contested open seat contests, ACSS was 7-0, including wins in hard fought victories by Jordan Cunningham (R-Central Coast) in AD 35, Raul Bocanegra (D-San Fernando Valley) in AD 39, and Al Muratsuchi (D-Torrance) in AD 66.

The two losses were those of incumbent legislators facing serious challenges. In AD 47, incumbent Democrat Cheryl Brown (San Bernardino) lost a tight race to a challenger from her own party who accused her of not acting like a Democrat. In AD 60, ACSS- endorsed Asm. Eric Linder (R-Corona) lost to a Democrat in a suburban Riverside County seat that increasingly votes Democratic.

The 17 state Senate candidates endorsed by ACSS all prevailed. In open seat races, ACSS was 7-0. This includes races in which the ACSS Democratic candidate had to beat another Democrat: Bill Dodd in SD 3 (Napa), Nancy Skinner in SD 9 (East Bay), and Steven Bradford in SD 35 (Gardena). In what were considered three of the bigger partisan Senate face-offs, the ACSS candidate won in each: Scott Wilk (R-Santa Clarita) in SD 21, Anthony Portantino (D-Pasadena) in SD 25, and Henry Stern (D-Thousand Oaks) in SD 27.

>> Click here to view complete election results for ACSS-endorsed candidates. Open seat candidates are in bold.