Panels Support 3 Percent State Pay Raise Big Majority Endorses Batt’s Salary Plan, Agrees Idaho’s Economy Can’t Handle More

The House and Senate human resources committees on Wednesday endorsed Gov. Phil Batt’s proposed 3 percent state employee pay raise in the 1996-1997 state budget.

Following a daylong hearing, an overwhelming majority of the two committees agreed that Idaho’s slowing economy and tight financial situation have left little question that 3 percent probably is all the state can afford in the new budget which will take effect next July.

“We may want to do a lot of things,” said Rep. Frank Bruneel, R-Lewiston. “But you can’t spend what you don’t have.”

Batt’s outgoing budget director, Dean Van Engelen, said the pay raise proposal keeps the governor’s commitment to a well-paid, professional state government work force while fitting into a tight budget blueprint.

“We considered the market as our main factor as well as the money we had to pay and what will fit in the budget,” Van Engelen told the committees. “The state of Idaho, in most parts of the state including Boise, is a good employer.”

The $24 million proposal, the first major piece of Batt’s budget to be unveiled, would scale back the 4.6 percent average pay raise the Personnel Commission had determined is needed to keep state salaries competitive in relation to pay for both similar private industry jobs in Idaho and government jobs in other Western states. Half of the money comes from the state’s increasingly limited general tax revenues.

Van Engelen, however, took issue with the commission’s calculation, arguing that its assessment is in inflated by the inclusion of salaries in Nevada, Washington and Oregon, which rank among the top 15 states nationally in state government salaries.

He said Batt settled on the 3 percent proposal after reviewing projections that inflation would run at about 2.9 percent during the second half of 1996 and the first six months of 1997, as well as anecdotal information that private industry pay increases in the coming year will be running around 2.7 percent or less.

Also included in the analysis was the fringebenefit package, which Van Engelen said is better than that offered by the federal government - a claim others disputed - and the fact that state employment is a significantly more secure job than work in private industry.

In addition, he said the state, with its current pay scales, has limited turnover and high application rates for openings.

While the governor’s plan for the next pay hike is substantially below the 5 percent he included for state worker pay raises in the current budget, it is higher than some had expected from Batt, given what is expected to be an extremely tight budget.

The governor will issue what is expected to be essentially a no-growth budget plan Wednesday.

The Batt administration’s chief economist, Michael Ferguson, and economists for both Idaho Power Co. and First Security Corp. reinforced the somber economic assessment for the special House-Senate Economic Outlook Committee.

“I think in 1996 and ‘97, caution is in order,” John Church of Idaho Power said.

“We’re not doing the 10 percent numbers, the 9 percent numbers of several years ago. It’s slowing considerably, … and for some, it will be shockingly slower if you’ve relied on growth to bail you out of something.”