May 31, 2013 in Idaho

Idaho scrimps on state employee pay

By The Spokesman-Review
 

BOISE – As University of Idaho President Duane Nellis leaves this week to become president of Texas Tech, his parting advice to the state was to invest in its workers by funding raises for state employees.

That’s something Idaho Gov. Butch Otter declared a priority early in his first term, noting the gap between state worker pay and market rates. But since the downturn hit, Idaho hasn’t funded state employee raises in four of the last five years.

“If I could give one final piece of advice to my friends in the state Legislature, it would be to invest in these people,” Nellis wrote in his parting message. “I would hope that your highest priority next year is CEC – Change in Employee Compensation. CEC affects our teachers, police, firefighters, librarians and thousands of other Idahoans who work hard to make our state and our communities better. It is critical for a state like Idaho to invest in its people, in the expertise it has, and not let them slip away to other states that pay a bit more.”

In fiscal year 2010, when the zero-raises started, Idaho’s state worker pay was 15 percent below market rates, according to a state-commissioned annual study. This year, it’s 18.9 percent below market.

“This all has to do with revenues,” Otter said. He successfully persuaded lawmakers to grant 5 percent merit-based raises to state employees in his first year in office, 2007. “It was my intent to go forward with that,” he said. “But as you know, in 2008 we had a different deck of cards.”

The only raise lawmakers have funded for state workers in the last five years was a 2 percent across-the-board boost for all workers performing to standards, approved in the 2012 legislative session for the current fiscal year. This year, CEC was left unfunded again for the coming year.

But Otter says he’s addressing state employee pay another way this year: With approval from the Legislature, agencies have been directed to use any savings they can identify in their budgets for either one-time bonuses, if the savings are one-time, or for ongoing raises, if they’re efficiencies that will continue. “They’re going through that process,” Otter said. “In fact, I’ve OK’d quite a few of those agency directors’ programs for utilizing their ongoing savings for increased ongoing salaries, and one-time savings for one-time bonuses.”

Under plans approved by the governor’s Division of Financial Management, $5 million in raises and $4 million in one-time bonuses are going out either this year or in the coming fiscal year, which starts July 1; a few agencies still are working on their plans. But workers in agencies that don’t have savings are out of luck.

Just 23 percent of state workers have gotten raises averaging $1,500 under the plans, and 30 percent have gotten bonuses averaging $900.

“Every agency is different,” said Jani Revier, Otter’s budget director. “It was done on the amount each agency could afford.”

For those with savings, agency directors were given wide latitude to direct the funds; most chose to reward top performers, boost the pay of those whose salaries lag the furthest below market, or to target high-turnover positions.

“They were really glad they could target what they needed to target – they were glad we weren’t prescriptive, that the governor had the policy of letting the directors direct, because each agency has a different need,” Revier said, “and what works at Agriculture might not work at Corrections.”

Those were the two agencies that identified the most savings and were able to give ongoing raises to a large number of their employees. At Corrections, the lowest-paid workers all saw their pay move up, “their correctional officers, food services workers, clerical staff – mostly uniformed staff,” Revier said. That group included 66 percent of the department’s employees.

“One of the reasons they’re trying to focus on increasing the pay for these low-paid employees was because they had a high turnover,” she said. “A lot of their guards, they’d train ‘em, and then they’d leave and go work for the county or Oregon or the city where they could make more money.”

The Department of Agriculture was able to target almost all of its employees, focusing on moving their pay closer to market rates.

But some large state agencies – notably the Department of Labor and Idaho Fish and Game – couldn’t give any pay boosts. Both are heavily dependent on federal funds, which have been pinched through sequestration and other federal budget cuts. At Labor, Revier said, “They’re not going to be able to do any type of compensation plan, and they’re probably looking at reductions as opposed to increases.”

Typical sources for savings at agencies were a staff vacancy that lasted longer than expected, generating a one-time savings; or a higher-paid worker who left and was replaced by a lower-paid worker, generating ongoing savings.

Out of 14,675 state employees, a figure that doesn’t include higher education or public schools, more than 4,400 got one-time bonuses totaling $4 million, and 3,423 got permanent raises totaling $5 million.

Some department heads were among those getting pay boosts. “All directors report to the governor, so compensation is determined by the governor,” Revier said. “So some directors were included, some were not – it depended on, just like every other employee, the amount of funds available in the agency and the plan that was put together by the agency and the performance of the director.”

The total amount spent so far on the pay boosts from all funds, at $9 million, falls well short of the $15 million it would cost the state to fund raises averaging 1 percent for all state employees.

“The governor wanted to give discretion to the agencies to direct and do the compensation plans in the way that made the most sense for each agency,” Revier said. “It’s probably not perfect, but it’s pretty good for what we were able to do with the funds that were available.”

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