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Sunday, October 11, 2009

Double-Dippers Cost Too Much for State

By Arcy M. Baca
President, AFSCME Local 477
          We have to start re-thinking our way of doing business in New Mexico. The population of New Mexico has grown by 10 percent in the last 10 years. The number of state classified employees has not grown. We have the same amount of front-line employees serving more citizens.
        We've had serious growth in upper-level management during that same time. While some of the positions unquestionably add value, it may be that there is significant duplication or lack of value added from the many new upper-management positions added.
        Much of the growth in upper management is attributable to the addition of double dipping, which encourages senior, high-cost individuals to stay far longer than they otherwise would. If you make $180,000 by double dipping, instead of just pulling in a great $80,000 retirement, you'll stay on.
        End double dipping and the highly paid upper management folks have to choose between working full time for $100,000 or taking the $80,000 retirement. Many more will voluntarily and happily leave if they are only giving up an additional $20,000 than if they are foregoing $100,000, which is what double dippers give up if they retire now.
        In addition to adding to the one area of state government that is larger than it used to be, double dipping costs the state millions of dollars.
        For each employee the state has, a contribution of 24.01 percent of that employee's salary is contributed to the PERA fund. The state contributes 15.09 percent and the employee contributes 8.92 percent. The return-to-work employee's contribution is picked up 100 percent by the state. That costs the taxpayer millions of extra dollars per year.
        Finally, when double dippers are re-instated to work they are given the maximum amount of leave that they left with, which amounts to 20 days paid vacation per year. A new employee coming into state government would only receive a total of 10 days per year.
        There are approximately 1,000 double dippers in state government. Some of the estimates I have seen show double dippers average $50,000 a year. So I will let you estimate the additional costs to the state in just the contribution to PERA and the additional annual leave.
        There is absolutely no reason to keep this practice going.
        Our budget crisis can only be solved in the long term with multiple approaches. I have suggested cuts that would not be painful to the citizens of New Mexico and to the employees.
        The other half of the equation is to raise revenues. How do you raise revenues? I would like to first commend two of our legislators from Santa Fe that have the courage to even talk about increasing revenues.
        Sen. Peter Wirth is proposing we have combined tax reporting for out of state corporations. Some might say that this is increasing taxes, but it's not. It's stopping tax avoidance from the richest companies in the world. How fair is it that businesses from New Mexico have to pay the taxes and out of state companies don't? We are letting millions of dollars that rightfully belong to the citizens of New Mexico go uncollected.
        Rep. Brian Egolf courageously has asked to roll back the massive tax breaks for the very wealthiest New Mexicans given in 2003.
        Citizens and voters always ask, "Where are the fiscally responsible politicians?" and, "Where are the politicians who stand up for what's right instead of what's popular?" Well, we have two of them right here in Santa Fe, with Wirth and Egolf.
        Let's hope the rest of the Legislature follows their lead and solves our budget crisis for the long term while not cutting the basic services that our citizens demand and deserve.