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Gregoire: Labor contracts ‘feasible’

Gov. Chris Gregoire’s budget office has ruled that a slew of labor contracts negotiated for 2013-’15 are “feasible” for Washington state to pay, opening the door to including them in a budget plan she expects to make public Tuesday.

The cost of the contracts, which are part of the shortfall calculation, has been estimated at about $238 million from the state’s general fund. That includes $171 million for ending the 3 percent pay and hour cuts for most of the state’s nearly 59,000 general-government workers – and $30 million for possible 1 percent raises in mid-2014, if the state’s revenues grow to a certain level.

Virtually all of that cost is included in state Office of Financial Management estimates that show the state faces a shortfall of about $904 million in the next two-year budget cycle. The pay changes vary quite a bit between higher-education unions in the new contracts, which are more generous in many cases than for general-government workers.

“It’s good news and a real morale boost for state employees who sacrificed to save the state during dire economic times. But now we have to work hard to make sure the Legislature goes along,” said Tim Welch, spokesman for the Washington Federation of State Employees, which represents about 40,000 workers in general government and higher education who bargained for the pay adjustments.

One union contract with the Inlandboatmen’s Union was declared infeasible. But negotiators were back at the table and a new agreement was near, according to Ralph Thomas of the governor’s Office of Financial Management.

Other nonstate employee groups such as home-care workers also bargain for contracts, but OFM did not issue a determination whether an arbitrator’s finding for SEIU Local 775’s home-care workers is affordable. An arbitrator had awarded SEIU’s home-care workers two yearly raises of 5 percent and other contract improvements, which could cost an extra $134 million that is not included in the state’s $904 million shortfall.

The feasibility determinations, issued Thursday, were a bit of a formality under terms of the state’s decade-old collective-bargaining law. But the review is considered a bit of a pressure valve when economic conditions quickly go bad – as they did in 2008, scuttling pay deals.

And putting out the feasibility letters lets the governor include the labor costs in her two-year budget, which she intends to make public at 10 a.m. Tuesday in Olympia.

Top House budget writer Ross Hunter, D-Medina, said the state’s November revenue forecast did not change enough since the contracts were negotiated in the fall to allow a change, so he didn’t see a way the contracts would have been rejected.

The union with the most generous pay adjustment is the Masters, Mates and Pilots Marine Operations Watch Supervisors. Its members are getting pay raises of 16.125 percent in 2013 and 2014 – for a total pay adjustment of almost one-third.

Under the state’s collective-bargaining law, state employees bargain directly with the governor for wage and health care benefits. This year’s agreements deal only with wages, leaving health care contracts still in negotiation for about 26 labor groups.