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Thursday, December 11, 2008

Freeze Plan Spurred Hiring

By Dan Boyd
Journal Capitol Bureau
       SANTA FE — After Gov. Bill Richardson announced a state government hiring freeze, his administration put 416 people on the payroll before it took effect.
    Members of the Legislative Finance Committee, confronted with a projected state budget shortfall of about $454 million, weren't happy with the news Wednesday.
    "I think it was disingenuous," said Sen. Sue Wilson Beffort, R-Sandia Park.
    State Personnel Director Sandra Perez told the committee that the hiring spree, which occurred during a four-week period between the Oct. 17 announcement and the Nov. 15 freeze, is normal for that time of year. She also said the state lost 359 employees during the same time period through normal attrition, including retirements.
    The attrition rate would mean the number of net new hires during the four-week period was 57.
    However, Perez conceded some departments might have been spurred into action by the threat of the hiring freeze.
    Perez defended the hires. "I understand the perception, but every one of those (hires) we reviewed to ensure they were done legitimately," she said.
    Sen. John Arthur Smith, D-Deming, the LFC's chairman, said the administration's hiring practices are "flat unsustainable."
    Rep. Luciano "Lucky" Varela, D-Santa Fe, the LFC's vice chairman, told the Journal that not all the hires appear to have been necessary.
    "I understand there were some exceptions in terms of critical positions, but I don't think all of them fall into that area," Varela said.
    It's unclear exactly how much the new hires will cost, Perez said. However, the state's payroll increased by about $530,000 from the pay period ending Oct. 31 to the pay period ending Nov. 14, the day before the freeze went into effect.
    The payroll then increased an additional $486,000 for the pay period ending Nov. 28.
    The state has a total of about 21,000 employees.
    The total state payroll as of the Nov. 28 pay period was $44.2 million, or $29.2 million in net pay, according to Department of Finance and Administration figures.
    Richardson announced the hiring freeze as the estimated state budget shortfall grew. Along with the freeze, he announced a plan to save $114 million in spending.
    Smith recently told the Journal the new hires likely will be the first to be laid off if the state is forced to cut its payroll because of a worsening state revenue picture.
    "If they're the last to come in, they'll probably be the first to go," Smith said.
    Data provided Wednesday to the LFC showed the number of exempt, or non-classified, employees has grown by nearly 49 percent from 535 to 796 during the past six years.
    Exempt employees are political hires serving at the pleasure of the executive branch. They are not protected by the personnel system.
    "I think the future holds for less employees in government out of necessity," Smith said. "Those that leave should not be replaced."
    Lawmakers say inflating the state payroll by more than $1 million before instituting a hiring freeze raises obvious red flags.
    "I hope we're all working on this (budget shortfall) without playing the system," Beffort said.