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By: Ted Dabrowski and John Klingner

When Gov. J.B. Pritzker was on the campaign trail, he promised to “lift up the standard of living” for Illinoisans by “putting dollars back in their pockets.” It didn’t take him long to break that promise.

Pritzker recently signed a $40 billion budget and a $45 billion capital bill backed by new revenues, including a doubling of the gas tax. The pain of those taxes will be felt heavily by Illinois’ working and middle classes for decades.

But now Illinoisans are learning more about where their dollars are going – to multi-year, guaranteed raises and potentially pensionable stipends for state workers who are already some of the highest paid government workers in the nation.

Gov. Pritzker apparently reached a tentative deal with AFSCME at the same time the 2020 budget was being passed. Now some of the details of the new contract have been leaked and reported by WCIA. The AFSCME contract matters because it captures why Illinois is in such a mess.

The facts which are detailed below, should make private sector residents fume. Ordinary Illinoisans don’t have long-term contracts that guarantee them automatic pay raises, or anything else for that matter. They don’t get free health insurance in retirement. They won’t get guaranteed lifetime pensions.

If ratified by the members, the new contract will be the first deal AFSCME has had with the state since 2015. The contract comes after several years of conflict with former Gov. Bruce Rauner, who tried to bring in state worker benefits with what Illinoisans could afford.

Rauner’s approach may have been an utter failure, but he was right to try and control the state’s operational costs. Before we get into the details of what AFSCME workers can expect in their new contract, it’s worth reviewing just how rich their benefits already are.

(1) Illinois state workers were already the second-highest paid workers in the nation when their contract expired in 2015, second only to New Jersey. (2) State workers get free health insurance during retirement after working just 20 years – a benefit worth $200,000 to $500,000 for each worker. (3) Nearly three-quarters of state worker health costs are covered by ordinary Illinoisans – a taxpayer subsidy of about $15,000 per worker. (4) AFSCME workers who spend a career in government will get lifetime pensions of more than $1.8 million. (5) Nearly 95 percent of state workers also participate in Social Security. (6) In all, the average compensation for state workers totals nearly $110,000.

Rauner and AFSCME fought over the terms of the contract for his entire term. The union originally demanded salary raises ranging from 11.5 to 29 percent, a 37.5-hour workweek, five weeks of vacation and enhanced health care coverage. Rauner wanted major reforms to both overtime and healthcare costs.

But now with Pritzker in charge and a new-found harmony in Springfield, AFSCME can get more of what it wants. What’s in the new contract? According to WCIA:

Governor J.B. Pritzker plans to offer pay raises, more time off work, enhanced family leave and a cash stipend to offset “financial hardship” state workers endured under the administration of his Republican predecessor, according to a copy of the Pritzker administration’s contract offer.

The one-time stipend of $2,500 will “be paid upon ratification of the agreement.” Union members will qualify for a quarter of the stipend so long as they worked one calendar day in any of the prior four years.

The new contract assures newer members they will continue to receive “step increases,” or automatic pay raises.

All members will see a pay raise of 1.5% on January 1, 2020, another pay raise of 2.1% on July 1, 2020, on July 1, 2021, a pay raise of 3.95%, and on July 1, 2022, a pay raise of 3.95%.

By 2022, the average state employee would see his or her annual salary jump from $59,679 up to $66,827 for an average net increase of more than $7,000.

Each worker’s increased contribution to the state’s health insurance program would cost roughly $624 to $864 extra each year.

We’ll have more to say on this later, but suffice it to say that Illinois is a national outlier when it comes to government worker costs, and in many cases, the state is an extreme outlier.

Yes, this new contract asks workers to pay a bit more for their healthcare, but the additional raises and new benefits they get in exchange will more than make up for the costs. Some of those benefits are, according to WCIA:

“Paid maternity leave for birth and adoption will increase from four weeks to 10 weeks,” the contract states, and will also expand to apply to both parents if they each work for the state. The 10 weeks can be taken together or back-to-back instead of the parents splitting one paid leave.

“The contract offer also removes the potential for discipline if employees decline to work mandatory overtime.

“The maximum time the employer may make temporary assignments unrelated to illness or injury leave will increase from 60 to 90 days,” the contract reads. “Outstanding debts to the state at the time of retirement will no longer be cause for termination of retiree health benefits, so long as the individual is making a good-faith effort to repay the debt.”

Paying for a protected class

Perhaps what best captures how well protected public sector workers are compared to the private sector is their guaranteed raises. AFSCME workers get raises in good times and bad thanks to the long-term contracts they negotiate with the state. In contrast, Illinoisans have to make do with less even as they are stuck paying AFSCME workers more.

Between 2005 and 2015 (when the last AFSCME contract expired), ordinary Illinoisans’ earnings grew only 11 percent, half the rate of inflation. Meanwhile, state AFSCME salaries grew more than 40 percent over the same period.

It didn’t take long for Pritzker to break his promises to Illinois’ working and middle classes. His hikes of highly regressive taxes, along with increasing the pay and benefits of some of the most highly compensated government workers in the nation, shows just where Pritzker’s priorities lie.

Read more about how politicians created Illinois’ crisis:

 

APPENDIX

Illinois state workers were the 2nd-highest paid in the nation when the last contract expired

Illinois state workers were the 2nd-highest paid in the nation in 2015 after adjusting for cost-of-living. Only New Jersey paid its state workers more than Illinois did. On average, Illinois state workers received 28 percent more than Wisconsin state workers and 40 percent more than state workers in Indiana.

Cadillac health care benefits

Illinoisans subsidize nearly $15,000, or 77 percent, of state worker annual health care costs. In Obamacare terms, state workers are paying bronze prices for platinum-level health care benefits. Taxpayers pick up the difference.

Free retiree health insurance after 20 years of work

State workers with 20-plus years of service get free health insurance during retirement (state workers get a 5 percent discount for their retiree health insurance for every year of work). That fringe benefit for career workers is worth $200,000 to $500,000 per retiree. Nobody in the private sector gets free retiree health insurance.

Nor do many in the public sector. The average subsidy for retiree insurance in the public sector across the nation is 50 percent.

$1.8 million lifetime pensions, on top of Social Security

Recent retirees who spent their careers working for the state can expect to collect $1.8 million in total pension benefits during their retirement. On top of that, 96 percent of state workers are enrolled in Social Security, so they’ll get benefits from that, too.

AFSCME workers receive, on average, total compensation of nearly $110,000

Add up all the compensation AFSCME employees get in a year – salary, overtime, healthcare benefits, future pension and health insurance benefits – and the average state worker costs ordinary Illinoisans nearly $110,000 a year.

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Barbara graefen

Why aren’t you telling the truth stop attacking the unions start looking at government they got there 15percent raises spent our pensions pocketed lotto money and tolls where did all that money go now have marajuana money that will probably be pocketed to and we will be made to make up that lost to

Downstate_downtrodden

With all due respect ma’am, it doesn’t take much research to see how much $ the unions contributed to help get those same pols elected in the first place. The guys at the top will get their kickbacks while telling their subordinates to maintain the status quo.

Pissed off Wife

Wow you are full of Crap Writer!! Get your facts straight before you write made up stories! Idoc workers pay for more than half of their own retirement. Why are they making so much money. One Shift supervisor lives at a Prison because there is not enough help to cover the work. They need to hire help! Talk about insurance!!! Our insurance has been horrible the last 4 years! Bills not paid because Rauner stoped it. We was paying for our insurance!!! I have dental insurance but can not afford to go to the dentist because they wasn’t getting paid… Read more »

Cass Andra

P-O-W Retirement and health benefits COST way more than double the amount you pay and you need to understand that taxpayers pay the rest. The people on this website understand that and report the truth. The regular newspapers and the unions and the politicians LIE. However, that’s not as important as your future — the thing you should know is that your expectations are not likely to be met because there won’t be any money to pay them. What you have is promises backed by zip. I hope you and your husband are old and retired because there MAY be… Read more »

Don’t know what we agree and disagree on, but one thing is for sure: Illinois politicians have made a mess of the state for virtually everybody. Read this piece and we may find common ground. https://wirepoints.org/illinois-crisis-20-facts-pritzker-doesnt-want-ordinary-illinoisans-to-know/

Cass Andra

Ted, I think yours was intended for Pissed Off Wife, but if directed to “Cass” please know that I have yet to find something on Wirepoints that I disagree with.

Tom Paine's Ghost

Wow. That sounds like the squeal of an AFSCAME piglet about to be pulled off of the taxpayer funded teat. The thought of working for market wages and for a full work day and full work week must be terrifying. And dont complain about the politicians not funding your pensions. AFSCME, IFT/CTU and SEIU have bribed these Illinois politicians for decades and stuck the hardworking taxpayers of Illinois with the bill. If the public sector union political puppets are simply promising the moon but instead spending Illinois’ outrageous tax revenue on other things then you’d better buy other politicians or… Read more »

Cass Andra

Maybe we should cut some slack to those who can’t or won’t understand because of intelligence, attention span or utter lack of understanding of political science and economics. Even when their pensions get cut or go unpaid, and even when they lose their health insurance, they’ll continue to lash out. I don’t mean we should meet their unsustainable expectations — tough love is always tough. But imagine the outcry 10 years from now when Social Security pensions and Medicare begin to contract. The counterpart of P.O.W.’s attitude is consistent with the practice of “kicking the can” because most politicians know… Read more »

Pat Maloney

He’s disgusting a disgrace to Illinois

Deb

Ripping us off just like the rest of Democrats let’s IMPEACH for lying and stealing more of our hard earned money

Scott Schniers

So how much are afscme employees to contribute to their pension. Nowhere is this stated. Also you state they are the second highest paid in 2015. That was 5 years ago. Where is more current data on this?

Scott

You’re completely missing the point of the article. These pay increases and increase in benefits on the backs of taxpayers in the private sector of a state thats in a financial tailspin is not normal. Anyone in illinois that didn’t see this coming is ignorant or stupid. Blagojevich and Madigan cronie Pritzker a chronic liar, cheat and scumbag. Always has been.

We have updated the latest comparison of average salaries in the piece – 2017. Illinois still in second.

Government workers put in far too little compared to what they get in retirement. They get to retire in their late-to-mid 50’s, get automatic 3% colas for life, and their yearly pensions have little relation to what employees put in. The whole defined benefit model needs to swapped out for a defined contribution model.

Karen Norris

Illinois has lost my respect. They tax every single thing they can. STOP IT! Want to prevent poverty and homelessness? DROP THE PROPERTY TAXES. PEOPLE WONT LOSE THEIR HOMES BECAUSE THEY CANT AFFORD THE TAXES!!! Use the money from the stupid tax hike and put it towards building solar fields for all schools and medical facilities so they dont have to rely on electric services. Hell, make all government facilities go solar as well. Wtf JB! Heres one…. why do I have to pay over 100.00 for a boring ass sticker to put on my license plate? That sticker is… Read more »

Mike Williams

Karen … just wondering, did you vote for Gov. Pritzker? (I’m guessing you did or you didn’t vote.)

VladK

Sure, she didn’t vote for these ugly Republicans!

Deb

Yep Democrat for sure my she enjoy what hes done

Tom Paine's Ghost

AFSCME are the lowest of the low. Within the holy trinity of evil public sector Unions – AFSCME, SEIU and IFT/CTU – they are the most subhuman public sector union slime.

When Illinois is bankrupt I look forward to stepping over AFSCME members while they are begging for pennies in the streets.

GLR

Democrat vote buying in it’s crudest form, the democrats are shameless. Anyone who can and doesn’t leave the state is a fool!

nixit

Does anyone have any insight on the difference between the JB and Rauner AFSCME offers? I found this letter from Rauner in 2016 that explained the raises being negotiated: “In the first year of the contract, they demanded a $1000 pensionable stipend instead of the initial demand for 2% additional wage increases. The pensionable stipend would basically be the same thing as a 2% wage increase. In the second year of the contract, they revised their demand from an additional 3% wage increase to 2.25%. In years 3 and 4, they remained at the same 3% demand they’ve had the… Read more »

Nixit, here is the info from Rauner’s team in 2015 on the AFSCME demands, i.e., “11.5 to 29 percent” info. https://drive.google.com/file/d/0B4Bi-iePG1O6Ml9yOGhreU1tNVk/view?pli=1 Let me know if you can’t access it and we’ll post it. We’ll have to spend some time analyzing the difference between the Rauner’s and JB’s proposals. We had a much more transparency then than we have now.

And here is the difference bewtween what Rauner proposed vs what AFSCME wanted…$3 B. John and I wrote about it while at IPI. https://www.illinoispolicy.org/afscmes-contract-demands-a-close-look-at-the-3b-hit-to-taxpayers/