With no votes to spare, the state House overturned a law that had called for a 2.5 percent raise for a couple of thousand nonunion state employees.
The 21-19 vote Wednesday afternoon rejecting a raise for nonunion workers followed a debate in which those favoring the measure said it was a choice of losing a cost-of-living adjustment for the many or having 90 people lose their jobs. Opponents of the plan said there were many options, not just those two.
At first, the measure failed on a 20-20 vote, but Palmer Republican Rep. Jim Colver changed his vote, tipping the balance.
The vote, unless it is reversed upon reconsideration, increases the chance the conference committee meeting on the budget will follow suit and eliminate a similar cost-of-living increase for nearly 16,000 state workers covered under collective-bargaining agreements. If one of the supporters switches sides on the bill for nonunion workers, the measure would fail.
The big difference between the bill voted on Wednesday and the situation facing a majority of employees, who are unionized, is the raise for nonunion workers was part of a law enacted in 2013, while the unions have signed multiyear contracts calling for cost-of-living raises this summer.
The largest of those unions, the Alaska State Employees Association, issued a statement Wednesday charging that the Legislature is on the verge of an violating labor contracts with an "unprecedented assault on state employees."
"If the Legislature upholds these disingenuous and selective cuts for state workers, they are effectively saying some obligations are not worth honoring — and that's not the way we do business in Alaska," said ASEA Executive Director Jim Duncan. "A contract is a contract. The Legislature needs to honor the commitments made. State employees have already made sacrifices and continue to honorably serve the needs of Alaskans every day."
The fate of the union raises will be decided by a conference committee which includes two House Republican members who argued for cutting the raises for nonunion workers—House Finance Committee co-chairmen Rep. Steve Thompson and Rep. Mark Neuman, both Republicans.
There are 826 exempt positions in the court system, more than 500 in the legislative branch and about 1,322 in the executive branch, according to state personnel officers. House Bill 176, which contains just one line striking down the pay increase, has yet to win approval in the Senate.
Thompson said HB 176 would save about $9 million and give "some control over the continuing rising cost of payroll as we find a sustainable fiscal path forward." Neuman said it was one of perhaps hundreds of steps the state would have to take to deal with its deficit. The bill would not impact the pay for legislators, who are not in line for an increase.
Fairbanks Democratic Rep. David Guttenberg said the measure puts "downward pressure on working people." He said the Legislature has not asked the companies that develop Alaska resources to bear any part of the burden and the message to employees is "we don't value them."
Neuman rose to object to what he said was the insinuation that "I do not appreciate any of the state employees here or that I look down on any of them." Several people in the 21-member majority said they like state employees, but the only responsible step was to reject the raise.
"We just don't have the money for raises," said Anchorage Republican Rep. Dan Saddler.
On the other hand, Anchorage Democratic Rep. Andy Josephson said the bill was designed to make it easier to implement cuts for unionized workers. "It's designed to soften up the argument that that's a breach of contract by saying, 'Yeah but we did it to the exempt and partially exempt, so what's the difference?' That concerns me gravely."
Josephson said there are about 100 choices legislators could make to deal with the issue and it is not a matter of cutting jobs or approving a 2.5 percent raise. "We really need a discussion about a fiscal plan," he said. But that hasn't happened during the 2015 legislative session, he said.
Fairbanks Democratic Rep. Adam Wool said as a small businessman, he has often had to pay himself less and found himself unable to offer raises to his employees. But he said that in cases where a promise is made, it should be kept to retain credibility, he said.