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Spokane, Washington  Est. May 19, 1883
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State estimates added cost of labor contracts

Associated Press

OLYMPIA – State officials estimate the cost of implementing labor contracts for Washington state employees and home care aides will add up to $583 million or more.

The estimates from the Office of Financial Management assume the union contracts will also change pay and benefits for nonunion employees in state government and Washington higher education, the Olympian reported.

The estimate also includes people who work for the Medicaid program, who are not state employees.

The office’s budget outlook report from September assumes roughly $273 million in new pension costs this time around, which could swell the labor-related costs in the budget to about $855 million overall.

The Office of Financial Management still has to determine if the contracts are financially feasible. And the Legislature still has to approve the contracts, which it won’t do until early next year.

The last time lawmakers tried to write a two-year budget, they went into overtime sessions that ran into late June and raised the specter of a government shutdown. This time, they have a court order hanging over their heads to increase the dollars going to K-12 education.

An estimated 64 percent of workers also are expected to receive “step” or longevity increases of 2.5 percent to 5 percent, according to the office.

The OFM sent key lawmakers a letter this month outlining costs on a contract-by-contract basis. The budget agency later calculated additional costs for including nonrepresented workers, including higher education.

The last round of labor contracts adding huge new costs to state government were for the 2007-09 period. Including increases in pensions, health care and wages, those costs were in the neighborhood of $2 billion, the office said at the time. Agreements for that budget cycle were declared financially infeasible, forcing new negotiations as the recession started.

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