Biweekly news digest from the California State University Employees Union
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GOV. BROWN DELIVERS STATE OF THE STATE ADDRESS
CSUEU SENDS INITIAL BARGAINING PROPOSAL TO CSU
PPIC: DON’T TAKE A MEAT AX TO HIGHER ED
PUBLIC WORKERS: MYTHS VS. REALITIES
CALPERS REPORTS 12.5% RETURN ON INVESTMENTS
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Gov. Brown Delivers State of the State Address
On Monday afternoon, Gov. Brown gave the first State of the State address of his current administration, focusing on his proposed June election to extend a number of temporary tax measures that would otherwise end this summer. Without passage of those tax extensions, he emphasized, California can’t even begin to get its financial house in order.
A recent Public Policy Institute of California poll found that most Californians are favorably disposed toward Brown’s tax extension plan.
That plan goes hand-in-hand with severe cuts across all state programs. As the Sacramento Bee reported on Tuesday, “Look for more cost-cutting announcements to trickle out of the administration over the coming weeks as the governor seeks to burnish his cost-cutter credentials and pressure members of his own party and Republicans to leave their comfort zones.”
Read CSUEU Pat Gantt’s response to the State of the State address.
Brown’s proposed state budget, unveiled in early January, calls for a $500 million cut to the CSU that would potentially balloon to $1 billion if the tax extensions fail. The CSU Board of Trustees didn’t spell out specific impacts during its most recent meeting, January 25-26, but the trustees did make it clear that all options are on the table. We’ll keep you posted on new developments in the weeks to come.
Read VP for Representation Russell Kilday-Hicks’ comments to the board last week.
CSUEU Sends Initial Bargaining Proposal to CSU
The contract between CSUEU and CSU expires on June 30, 2011, and negotiations will soon begin for a new contract. Late last week, CSUEU submitted an outline of its initial bargaining proposals to the CSU.
The delivery of these proposals begins what is known as the “sunshine process,” which culminates on March 22 with the CSU Board of Trustees’ approval of management’s proposals. In the meantime, the parties will be discussing dates and places to hold bargaining.
Read the initial bargaining proposals that the CSUEU bargaining team made.
The bargaining team is seeking your input as we prioritize bargaining proposals. A member survey will be posted on the CSUEU web site in the near future.
We will also be printing and distributing this survey in English and Spanish for those employees without ready access to computers. Members will be able to obtain hard copies as needed from their chapter presidents.
The results of the survey will be important to the union as we begin bargaining, deal with yet another state budget crisis, and begin to organize around the proposed special election this June. The bargaining team will provide the Board of Directors with preliminary survey results at the board’s meeting later this month.
We will keep you closely apprised of bargaining and bargaining-related developments in the months to come.
PPIC: Don’t Take a Meat Ax to Higher Education
Hans Johnson, director of research for the Public Policy Institute of California, published a hard-hitting opinion piece in the January 28 edition of the Sacramento Bee advocating a cautious approach to higher education budget cuts.
“California's national and global competitiveness depend on highly skilled and highly educated workers,” he wrote. “Most job creation in California occurs with the establishment of new businesses – businesses that are disproportionately started by college graduates. In addition, California’s history of increasing economic well-being has occurred primarily because of improvements in educational attainment.”
Read the entire article.
Public Workers: Myths Vs. Realities
Two informative articles have been published recently debunking popular myths about state workers.
In Labor Notes, writer Mark Brenner has penned a piece titled “Public Employees: Myths and Realities,” in which he writes:
The Claim: Government employees are overpaid.
The Facts: The Economic Policy Institute measured state and local public workers against their private sector counterparts with the same age, experience, and education. They found that public workers earn about 11 percent less. Public workers had better benefits on average, but even when health care and retirement were included, public workers were still 4 percent behind private sector counterparts. Claims that state and local government workers are overpaid often fail to account for their education and experience. Fifty-four percent have at least a four-year college degree, compared to 35 percent in the private sector.
Read the full article.
And, in the Chico News & Review, Chico State professor emeritus of sociology Walt Schafer has published an article titled “Public Spending: Myths Vs. Facts,” which includes this thought-provoking passage:
Myth: State employees are not sacrificing like private-sector employees.
Facts: Take-home pay for the same job classifications has declined by 44 percent over the past 15 years for California state employees (adjusting for inflation) as a result of pay cuts, increased medical insurance costs, and furloughs. Excluding furloughs, the decline has still been 30 percent.
Myth: State employees in California are no more educated than private-sector employees and, hence, should be paid no more than private-sector workers.
Facts: Public employees in California are more than twice as likely to hold a college degree or more compared with private-sector employees (48 percent vs. 23 percent).
Read the full article.
CalPERS Reports 12.5 Percent Net Return on Investments
The California Public Employees’ Retirement System has reported that it earned a 12.5 percent net return on investments for the 2010 calendar year. The solid net returns mark the second year of double-digit gains for the nation’s largest public pension fund.
Total fund assets closed 2010 at $225.7 billion. CalPERS assets have gained more than $65 billion since the fund’s low point in March 2009, at $160 billion.
“We repositioned our portfolio to take full advantage of the overall gains in the market last year,” said Joseph Dear, CalPERS Chief Investment Officer. “The strong returns we saw in 2010 prove that our comprehensive evaluation of all our investments is paying off for our members, employers and taxpayers.”
Though the real estate portfolio saw an overall decline of 5 percent in 2010, the drop was the smallest since the beginning of the financial crisis. The reported returns also lag the year-end results by one quarter.
In December 2010, after nearly a year of review, the CalPERS Board of Administration approved a new asset allocation plan designed to position the fund for better risk-adjusted performance. The new model, which places investments in one of five groups, focuses on the risks to the portfolio and how different investments perform in different economic climates. This will enable the Board and CalPERS investment professionals to better manage risk.
Read the entire CalPERS press release.
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