November 19, 2010 in News

State wants to reopen union contracts

Revenue forecast mean cuts needed — Gregoire
By The Spokesman-Review
 

OLYMPIA — Thursday’s worse than expected revenue forecast prompted Gov. Chris Gregoire to order state employee unions back to the bargaining table to renegotiate contracts.

With a proclamation, Gregoire invoked a state law that allows her to ask the unions to reopen existing contracts. A separate declaration by Office of Financial Management Director Marty Brown about the forecast for the 2011-13 biennium says the contracts reached for those years are also unfeasible and must be reopened.

Most of the major contracts for 2011-13 are still under negotiations, a spokeswoman for Gregoire said.

Gregoire had resisted declaring an emergency and trying to renegotiate the current contracts during the past session, despite some drops in revenue projections. But Thursday’s revenue forecast was worse than expected, prompting a call to reopen contracts the state has signed with its workers.

Forecasters believe the state will collect about $1.2 billion less than expected over the next 30 months. That means a drop of $385 million between now and June 30th, and some $810 million less than expected in the two-year budget cycle between next July and June 2013.

When the current contracts were being negotiated, the state was expecting about $34 billion in general fund revenues for its 2009-11 biennium. Based on Thursday’s forecast, it will actually bring in about $28 billion, or about $6 billion less than it once expected.

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