1. 2010 Legislative Update

2. What is Local 1000’s 2010 Legislative Agenda?
Top Priorities
State Budget
Legislation
Pension Reform
Initiatives

3. Governor’s Proposed Budget
5/5/5 plan:
Increase in PERS contributions by employee (5%)
“Workforce cap” (5%)
Salary reduction (5%)
“Trigger”
Additionally:
Reduction of $152.8 million by contracting for lower cost health care coverage either directly from an insurer or through CalPERS
Decrease of $98.1 million for pre-funding health and dental for Annuitants
5% increase in PERS contributions by employee (reduction to employer by same amount) $405.8 million)
5% salary reduction ($529.6 million savings)
5% across the board cut (“workforce cap”) to departments in personnel costs (through attrition/vacancies) $449.6 million savings (not constitutionals, since they already had reduction.
Additional 5% salary reduction if CA doesn’t receive $6.9 in federal stimulus money
This totals a 15% salary reduction for state employees - $1.6 Billion GF
Also:
Reduction of $152.8 million by contracting for lower cost health care coverage either directly from an insurer or through CalPERS
Decrease of $98.1 million for pre-funding health and dental for Annuitants

4. LAO’s Analysis of Governor’s Proposals
Increase in PERS contributions by employee (5%)
Analysis: PERS increase is “risky” if done legislatively
Recommendation:
pension reform for new employees
Collective bargaining
“Workforce cap” (5%)
Analysis: Workforce cap won’t work
Recommendation: Don’t do it but if done, don’t touch CDCR
Who determines what gets cut and what doesn’t? There is no legislative involvement so it is up to departments – they will cut what the Governor says.
CDCR – this would be about another $300 million in reductions in addition to the $1.1 billion that the Gov. proposed on top of the reducations to corrections that the legislative is still trying to figure out how to do.
Also, why doesn’t this apply to operating expenses and equipment?
Why does this apply to federally or specially funded departments?
LAO says the state has little to give – we negotiated a 5% pay cut, two holidays and numerous other things non monetary (flexible work schedules, etc)
Forced bargaining – essentially forcing unions to bargain FOR furlough days.
Administration can implement reduction for excluded and exempt employees without legislative action
Dills Act – Any provision of an MOU requiring expenditures may not become effective unless approved by the legislature in the annual budget act
Recommendation: pay cuts by bargaining unit or classification
Across the board salary reductions but provide the administration and BU’s with time to develop an alternative.
Cuts could be permanent or temporary

5. LAO’s Analysis of Governor’s Proposals
Salary reduction (5%)
Analysis: Pay cut is the only way to go
Recommendation:
CUT STATE EMPLOYEE SALARIES

6. Furlough Legislation AB 1215 (De La Torre) SBX8 29 (Steinberg)
This bill would exempt public employees from furloughs who are in positions that are funded at least 95% by sources other than the General Fund . AB 1215 is currently on the Senate’s Third Reading File and requires a majority vote to be sent to the Governor’s desk.
SBX8 29 (Steinberg)
Same bill but in Extraordinary Session that the Governor called on January 8, 2010 – Legislature must convene by February 22, 2010

7. Other Legislation AB 1699 (Hernandez)
Continuous Appropriations bill in the event a budget is not in place by June 15, 2010
Reincarnation of AB 1125
Due to multiple court decisions, if there is no budget in place by June 15, 2010, state employees are subject to being paid the federal minimum wage required under the Fair Labor Standards Act, which for most employees is $7.25
This bill will ensure that state employees receive their full salary in the event a budget is not passed by June 15, 2010, by continuously appropriating employee payroll
Had 8000 letters/ s delivered to Legislators in 4 days

8. MOU Update Assembly Bill 964 Assembly Bill 88
Failed to pass Assembly by January 31st deadline (because it was a two-year bill)
Assembly Bill 88
2 year bill
Location: Senate Floor
Next Steps: Need 2/3 approval from the Senate by August 31, 2010 to send to the Governor’s desk.

9. Local 1000 Sponsored Bills EDD SCIF Transparency
Rural Health Care Equity Program
CDCR
BOE
SPB
State Bar
MOU
EDD one stop Centers – in person unemployment benefit assistance paid for with existing EDD money for the admin of the unemployment compensation program
SCIF bills – board members ratified by senate; insurance agents must meet the same requirements (licensure) as those who sell insurance in private practice.
DDSD- SCO audit of federal funds provided by SSA
DMV- spot bill to provide annual report on effectiveness of all new procedures, programs and incentives to provide drivers with the most accessible service.
Transparency – Governor’s Executive Order as legislation
Rural Health Care Equity Program – reinstatement, but no funding
CDCR – educators bill
BOE – sale of sick building
SPB – restrict departments from renewing disapproved contracts
Investigation period two years
State Bar
MOU

10. Pension Reform
Return to pre SB 400 retirement formulas
Repeal SB 183

11. 2010 Initiatives Ballot Measurers Certified for June 8 Primary
Property tax: new construction exclusion: seismic retrofitting.
Elections: open primaries.
Political Reform Act of 1974: California Fair Elections Act of 2008.
New Two-Thirds Vote Requirement for Local Public Electricity Providers. Initiative Constitutional Amendment.
Allows Auto Insurance Companies to Base Their Prices in Part on a Driver’s History of Insurance Coverage. Initiative Statute.

12. Questions