Wednesday January 26, 2000

Chairmen Stafford and Farrell. Honorable Committee Members. I am Jane Hallum, Secretary-Treasurer of the New York State Public Employees Federation.

I am here today to talk to you about the proposed budget and its impact on the 54,000 members in the Professional, Scientific and Technical bargaining units of New York State.

As you are all aware, PEF members are still without a contract almost one year after our contract expired. The last raise our members received was in October 1998.

The Executive Budget proposes that the State set aside a General Fund reserve for collective bargaining agreements. The State has informed PEF that these reserves would fund their current contract offer. In effect, such an approach imposes rather than negotiates, dictates rather than bargains. We have no objection to the State setting aside a reserve fund. That reserve fund, however, should not be used to determine the final contract settlement.

Let’s get right to the heart of the matter. If the reserves are predicated on the State’s current contract offer- that is, 3% annual raises deferred for six months in each year- we tell you now, as we have told the Governor at the negotiating table, our members will not accept such an offer.

I’d like to take a few minutes to explain why we cannot accept the State’s current offer. Ultimately, it is about fairness.

3% Raises Deferred Halfway Through the Year Are Not Fair

During the fiscal difficulties of the 1990s, the State abolished tens of thousands of positions. The dedicated workers who remained grudgingly accepted unsatisfactory wage increases in their contract. In four of the last eight years, the State said it could not afford any wage increases at all.

We are now in a different fiscal climate. During the last three fiscal years, we saw a $1.4 billion surplus, a $2 billion surplus, and a $1.8 billion dollar surplus. Many experts predict at least another billion-dollar surplus at the end of this fiscal year.

State employees have helped create these surpluses, and our members rightly expect a fair and equitable salary increase. A 30-year PEF member calculated his salary increases over the past 30 years and determined that for those 30 years he received less than 2% per year.

We are not asking for the 38% the Governor took but we will not be treated unfairly. The Governor’s current offer of a 3% raise delayed for six months amounts to an increase of only $12.69 per week for the average PEF member. What’s worse, this $12.69 will only be in their pockets briefly because the State’s contract offer also raised the cost of their health insurance.

Just a month ago the Governor claimed credit for the Transit Worker’s Settlement at the MTA. That contract provided a 12.5% wage increase over three years, in addition to reductions of up to 3.2% in employee pension contributions. It is not unreasonable to expect that we be treated in the same manner.

During the cash poor 90s, the State’s position was that if there were any raises, they would only be possible if they were deferred for six months from the April 1 start of the contract year. This disturbing trend began in 1994, and was repeated in the 1995-99 Contract. In fact, under the terms of our last contract, State employees waited three years for a base salary increase. While we were not pleased with this compensation model, we accepted it, having been persuaded by the State’s projection of fiscal gloom and doom.

The gloom has ended, and you are all wrestling with what to do with the $3 billion reserve you already have, and another $1 billion in surplus revenues the State is likely to collect. Despite this reversal, the Governor is insisting that wage increases be deferred for six months in each year of the agreement. There is no supporting rationale, yet he demands that we wait for our raises. With no rationale, this proposal can only be taken as an insult to the members we represent, and is especially repugnant to us in light of the recently negotiated agreements at the MTA and the Thruway Authority, neither of which deferred salary increases at all.

As if the economics of their proposal weren’t offensive enough, the State is asking PEF to make a number of dramatic concessions in exchange for the inadequate wage package

PEF and other union leaders have often referred to the fact that the current multi-billion-dollar surplus was created on the backs of state employees. Here is why we feel this way. From SFY 1991-92 through SFY 1998-99, personal services expenditures for the State, in 1991 constant dollars, decreased by 11% from $7.9 billion to $7 billion. During that same time period, the State workforce decreased by over 20,000 employees. State employees were asked to do more with less. We have done more with less. These productively gains have significantly contributed to the surplus the State currently enjoys. Good management rewards productivity gains. It is only fair to set aside an adequate amount of this surplus for State employee raises.

Aside from the amount the Governor has set aside for pay raises, we also question why this reserve is limited to the General Fund. As you know, more than 44% of the State workforce is carried on budget lines supported by revenues other than the General Fund. General Fund revenues cannot be used to support expenditures on so-called “Special-Revenue Other” lines. Has the State made allowances for the cost of raises for these employees as well? Is the General Fund collective bargaining reserve only a portion of what is held in collective bargaining reserves for this fiscal year? Are the future years’ General Fund collective bargaining reserves also partial reserves? If not, how will raises for State employees paid on “Special-Revenue Other” lines be paid for? Again, we have no real basis to judge this since no specific information has been made available about the nature of these collective bargaining reserves.

You have no doubt heard from your constituents about the PEF Contract struggle. I hope this has given you a bit more insight on why we will not accept the Governor’s inferior proposal. Viewed broadly, he is not treating us fairly; more narrowly, he is not offering us the same benefits he approved for other State employees. Until his position changes, we have no choice but to continue our struggle. We cannot allow our members to be treated unfairly.

When the Legislature develops the fiscal plan for the coming year, we encourage you to scrutinize the collective bargaining reserve fund the Governor has proposed with the thought that the compensation model on which he based his reserve is unsatisfactory. It will be rejected by the PEF membership and we believe by the members of other State employee unions as well. State workers are citizens and taxpayers too. We urge you to plan accordingly and ask for your support to ensure that collective bargaining reserves are adequate to provide State employees with a fair raise. Again, we would reiterate that the size of the reserve should not determine the ultimate contract settlement.

At one rally at the State Campus, I met an employee who was resigning to work at Wal-Mart for a better salary and better benefits. Please don’t let State employees be cast off to Wal-Mart.

Whenever PEF advocates for public employees, particularly the professionals we represent, we hear several common misconceptions. One is that there are too many State employees. Another is that they are paid too much and their jobs could be done more efficiently and for less money by private sector companies. However, in New York State, reality is much different than rhetoric.

Nationally, the size of New York State’s government ranks 41st among the states for the number of employees per resident. New York State’s workforce is smaller per capita than states such as Michigan, New Jersey, North Carolina, and Texas.

Professional employees working for New York State earn on average 15% less than their counterparts in private industry. The State’s nurses and doctors, engineers, computer programmers, teachers, lawyers, and pharmacists, to name a few, represent a bargain for the taxpayers of New York. For example, the average salary for pharmacists in retail chain stores in April 1997 was $62,000, while the average salary for State-employed pharmacists in November 1998 was $46,376. In 1996, computer programmers in the private sector earned an average salary of $56,097, while State-employed computer programmers earned an average salary of $47,427. These career professionals are consistently being asked to do more with less resources.

Constant job insecurity erodes morale and saps worker productivity. It is time to declare a moratorium on further reductions in positions at all State agencies, so we can all get back to getting the job done. It is time to invest some of the State’s multi-billion surplus into the State workforce.

We would now like to outline some of the issues we need to address this session. Many State employees work long hours or forced overtime, trying to do the work that two or three people used to do. They are often asked by their managers to do work which goes beyond their job responsibilities. This is occurring because their agencies cannot get the Division of Budget’s approval to fill positions that are needed, even when the Legislature has given budget authority to fill these jobs.

Every State agency about which we will testify today is currently below the fill level they were budgeted for this fiscal year. The Legislature must take affirmative steps to ensure that the positions for which budget authority is approved are filled. This is the only way the Legislature can ensure that the services you want the public to receive are provided to them.

***

We are in the difficult position of commenting on the Department of Justice proposal when to a large degree it is a mystery to all but its creators. This proposal calls for the consolidation of eight separate agencies: the Department of Correctional Services, Division of Criminal Justice Services, Division of State Police, Division of Parole, Division of Probation and Correctional Alternatives, Commission of Correction, Crime Victims Board, and Office for the Prevention of Domestic Violence.

It requires several leaps of faith and imagination to comprehend the scope and effect of a consolidation of this magnitude, particularly when so little detail has been given about the end product. The only obvious thing about this proposal is that it pretends to fix something that is clearly not broken, and runs the risk of breaking it in the process.

In discussions with PEF members since this budget was released, the most frequent characterization of this proposal is “buying a pig in a poke.” A great deal of this cynicism results from the lack of consultation that went into this proposal’s development. It is a basic, well-accepted standard of organizational practice, particularly in public administration, that successful major change requires consultation with and input from all affected participants.

Not only were you, the Legislature, not consulted, but the end result also severely restricts your ability to fulfill your constitutional obligation to oversee agency operations through the budgetary process. For example, the budget of the former Department of Correctional Services had seven separate program areas, with six pages of line items. The budget of the proposed Division of Correctional Services consists of essentially a $1.8 billion lump sum appropriation, distinguished only by fund type, with little if any indication of how that money will be spent, and no opportunity for you to control appropriations to particular programs. For example, there is nothing in this proposal that could stop the Commissioner of the new Department of Justice or the Director of the new Division of Correctional Services from eliminating all drug counseling in our prisons in order to shift funds to additional security staff.

So here we have the creation of a behemoth agency, with a budget of $2.8 billion, nearly 41,000 employees, and the ability to influence criminal justice policy affecting every citizen in New York State, and we are presented with only the barest outline of a plan.

The lack of extensive planning that went into this proposal is evident from the enabling legislation. It calls for a transitional task force to develop a comprehensive legislative proposal for the transfer nine months after the actual implementation occurs and after the Legislature has approved $20 million in cuts to these agencies’ State Operations budgets. Simple logic demands that this process occur before a change of this magnitude is implemented.

The secrecy surrounding this proposal leads us to question its motivation. We are told that the benefits are a consolidation of technology, improved service to local governments, and operating savings. The latter includes $20 million attributed to operational efficiencies. What is lost in the magnitude of this proposal is the effect of such a cut on the individual agencies involved.

This proposal provides a smokescreen for drastic cuts in individual agencies that would not be approved by the Legislature if considered on their own merits.

Each of these agencies is already doing more with less. They currently have combined vacancies of over 4,000 competitive class positions. Excluding Corrections, the remaining seven agencies’ total competitive class workforce has decreased by 200 positions since October 1994. Only DOCS’s competitive class workforce has shown an increase in that period (1,356), but that reflects the establishment of two new prisons and represents a real decrease in positions outside the new prisons, particularly in program services.

PEF only has access to competitive class workforce data before 1999; we have therefore compared the competitive class workforce of all eight criminal justice agencies. It you take into account the non-competitive and exempt workforce of these agencies, the total number of vacancies increases to 4,614. The Department of Correctional Services has 3,717 vacancies, the Division of Criminal Justice services has 195, the Division of Parole has 194, the State Police has 467, the Commission of Correction has 16, the Division of Probation and Correctional Alternatives has 7, the Office for the Prevention of Domestic Violence has 4, and the Crime Victims Board has 14.

These agencies experienced this decrease in workforce while facing a substantial increase in workload. Since 1994, various criminal justice initiatives have been enacted, including elimination of parole release and work release for violent felony offenders, tougher penalties for assault crimes, and the creation of a DNA database. Within the same time period, the State prison population has increased by 12,000 inmates, including a 15% increase in violent felons who pose a greater danger to safety and security. This has created increased workloads for corrections staff, institutional parole officers, and Commission of Correction staff. This period also saw the creation of the Sex Offender Registry, increased Parole caseloads, and a doubling of the number of clearinghouse calls received by the Office for the Prevention of Domestic Violence. During this period, DCJS was responsible for implementation of new standards for DNA testing, the Federal Brady Bill and Violence Against Women Act, and the Governor’s Violent Juvenile Action Grant Program.

The Governor’s criminal justice proposals for this year would further strain the already limited resources in these agencies. These include the abolition of parole and the “three strikes and you’re out” for misdemeanor convictions proposal. Both proposals portend an increase in the prison population. The Governor’s proposal to decrease funding for probation and alternatives to correction will also ultimately increase the number of inmates by severely limiting the preventive measures local governments can take to prevent the escalation of crime in a cost effective manner without incarceration.

Any further diminishment of post-release supervision will undoubtedly also result in increased arrests and incarceration, the costs of which far offset any savings achieved by administrative reorganization. Parole is an effective crime control tool, as demonstrated by the dramatic decline in the number of parolee arrests since 1994, far exceeding that of all arrests statewide. The Division of Parole has been able to reduce parolee arrests for violent felonies 36% (compared to 15% of all violent felonies), notwithstanding increased caseloads.

The former Division of Parole is slated for reductions of 36 supervising Parole Officers based on a reduction in parolees and a reduction of 100 Parole Officers related to lower work release projections. At a time when Parole Officers have caseloads of 87 to 120 parolees, these positions should not be eliminated, but should be used to distribute existing workload and lower caseloads to a reasonable level.

Despite the increased workload and decreased workforce in these agencies, the employees have functioned together to bring about the criminal justice successes that the Governor has touted. The reduction in violent crime that is two times greater than that of the rest of the nation could not have come about without the determined efforts of these employees. To further reduce these agencies’ workforces in light of the staggering number of existing vacancies will clearly undermine the progress made and threaten public safety.

In addition, the efficiencies that the Governor claims will save $20 million in the coming year (including savings attributed to food service and energy related efficiencies, which would be realized without consolidation) do not reflect the potentially diminished capacity of these agencies to fulfill their missions.

The consolidation of all decision-making power in one centralized location and the reduction of support staff will surely create bottlenecks in service delivery. Line staff will be distanced from those providing support, who, as a result of consolidation, may be unfamiliar with the particular needs of each branch of the new department. The ability to control staffing decisions will be transferred to one central authority, bypassing those responsible for day-to-day operations who are aware of the intricate demands of each agency.

Furthermore, this operational structure opens the door to widespread reorganizations, employee movement, and title changes with no system of checks and balances. Employees who have spent their entire professional careers in one agency will be moved to another agency, often without regard to their seniority or the work they actually perform. Such employees will be cut off from their promotional opportunities and will often end up in dead-end careers.

PEF and its members are still dealing with the aftermath of the dismantling of the Department of Social Services, the creation of the Office of Children and Family Services and the Office for Temporary and Disability Assistance, and the movement of employees to the new agencies or to the Department of Labor or Department of Health. All the problems discussed above have occurred. It has been four years since this last reorganization and we are still awaiting an Appellate Division decision regarding the manipulation of the transfer of function process to target individual employees, disrupt their professional careers, and take away their promotion opportunities. A long promised proposal to consolidate titles and give employees new lines of promotion in their new agencies is still not complete. Every day PEF receives complaints from ex-Department of Social Services’ employees who are no longer allowed to take promotion examinations that they were once qualified to take. We cannot afford to make this mistake again.

The suggested efficiencies related to consolidation of criminal justice technology are unclear. Mainframe operations in these agencies are already being consolidated through the Office for Technology. Furthermore, the major roadblock to creating a comprehensive criminal justice information system is the inclusion of information systems controlled by the court system, which are not, and cannot be, addressed by this proposal.

Some of the agencies designated for consolidation are inappropriate for inclusion in a Department of Justice. The Commission of Correction, as a watchdog agency, needs to maintain independence from the agency it is responsible for overseeing. The Crime Victims Board and the Office for the Prevention of Domestic Violence are also inappropriately combined with crime control agencies.

The mission of the Crime Victims Board has little to do with the apprehension and conviction of criminals, but rather is focused on easing the burden of victims. Similarly, the Office of the Prevention of Domestic Violence bridges the criminal justice and social services communities. It is recognized for criminal justice initiatives that have dramatically improved criminal and legal systems’ responses to victims and perpetrators statewide. However, the Office for the Prevention of Domestic Violence goes beyond crime control programs to also provide training and technical assistance to a wide variety of non-criminal justice agencies and organizations that are interested in developing and implementing domestic violence policies and protocols. These agencies include health, mental health, substance abuse, education, and human service public and private agencies on both the state and local level.

The criminal justice initiatives of the Office for the Prevention of Domestic Violence enjoy the kind of strong support and trust by domestic violence service providers and criminal justice system agencies that they would not have as a criminal justice agency. Characterizing this office as a criminal justice agency could compromise the credibility and working relationships built over many years through collaborations with local domestic violence service providers across the State. This is one reason why the Office for Prevention of Domestic Violence was never included in the Public Protection budget but rather in the Education, Labor, and Family Assistance budget.

We fear that the integrity and distinct purposes of the Commission of Correction, Crime Victims Board, and Office for the Prevention of Domestic Violence will be minimized and assigned low priority in an agency with a primary mission of crime control. It is all too easy to imagine the diversion of funding from the small scale but important services provided by these agencies to the other components of the Department of Justice that have larger, more visible operations and growing fiscal demands. The Executive Budget allows complete interchange authority between all appropriations within the new department, making this a likely scenario.

Clearly this proposal has too many unanswered questions, too few details, and too many potential drawbacks to implement at this time. Do not try to fix State agencies that are not broken. Do not cut the budgets of the criminal justice agencies that are already understaffed by over 4,000 positions. Reject this ill-advised consolidation proposal just as you rejected the previous criminal justice consolidation proposal by Governor Cuomo several years ago. Do not risk public safety and protection to save $20 million in a budget year where there are multi-billion dollar surpluses.

***

For several years PEF has expressed its concern about the dangerous downsizing mission started in 1995 at the Office of Mental Health (OMH) and the Office of Mental Retardation and Developmental Disabilities (OMRDD). The existing surplus and bad publicity has begun to change the Administration’s four-year policy that the amount and quality of services to the mentally ill, mentally retarded, and developmentally disabled will be determined by fiscal, not therapeutic, demands. This policy has recently resulted in two murders by mentally ill individuals who were not receiving the professional assistance they needed to safely remain in the community.

For the first time in many years, the budgets for mental health agencies include many items worthy of praise. Both budgets include net staff increases for the coming year, 320 in OMH and 446 in OMRDD. OMH’s budget reflects the Governor’s mental health initiative announced in November, including a moratorium on psychiatric center bed reductions, the creation of state-operated transitional facilities, enhanced oversight of community-based programs, and Mobile Mental Health Teams to serve children in Office of Children and Family Services facilities. OMRDD’s budget includes continued funding for state-operated NYS CARES beds, the transition of contractual information services positions to State Operations, additional service coordination positions in Family Care, enhanced staffing in Intensive Treatment Units, and expansion of specialized care for the most behaviorally challenged OMRDD clients.

Despite these significant advances, we would like to make you aware of several concerns we have in each agency’s budget.

The Governor’s call for a temporary moratorium on psychiatric center bed reductions is long overdue. PEF has repeatedly documented the effects of downsizing. The remaining inpatient population is younger, more violent, and has a higher percentage of substance abusers. The homeless on the streets of our cities exhibit high rates of mental illness (25,000 to 40,000 severely mentally ill in New York City alone). Additionally, we see increased placement of the mentally ill in our nation’s prisons and jails. There are more inmates treated for serious mental disorders in New York’s prisons (approximately 6,000) than there are patients in State psychiatric centers (approximately 5,300). In OMH psychiatric centers, 23.7% of the patients have criminal conviction histories.

This moratorium should continue until New Yorkers can be assured that only those patients appropriate for release are discharged into our communities and that every discharged patient receives comprehensive treatment.

However, despite the moratorium, the OMH budget indicates a reduction in inpatient staffing (383 averaged annual salaried positions). It defies logic that the same number of patients will be maintained in our psychiatric centers but will be cared for by fewer staff. Many of OMH’s clinical staff are already working out-of-title by doing administrative and support functions (e.g., acting as team leaders, assisting with laundry operations, etc.). Meanwhile, the demands on clinical staff for increased clinical workloads continue to grow. The proposed reduction of 100 administrative and support staff at Pilgrim and Manhattan Psychiatric Centers combined with other as yet unrevealed reductions will further aggravate this trend of overextending clinical staff.

More difficult patients require more intensive staffing, especially when these patients are in a concentrated population of predominantly difficult patients. This was documented by a recent study of the psychiatric center population in Maryland, which concluded that “Paradoxically, although downsizing may result in fewer patients, the need for staff may not be reduced, given the qualitative changes in the patient population.”

This concentration of difficult patients also affects the safety of staff. Patient assaults on staff have increased as staffing levels have decreased. PEF provides free insurance for all our members to reimburse them for costs associated with an attack while on the job. In 1995, 39 PEF members at OMH were paid benefits under PEF’s assault, trauma and attack coverage. In 1996, 70 OMH employees were paid benefits, an 80% increase in only one year and the largest number of claims ever filed in one year. Our 1998 claims diminished only slightly (62 claims paid) from this level, despite a reduction in the number of inpatients. PEF pays more claims under this program to our members who work in OMH facilities than we pay to our members who work in State prisons.

In addition, for the first two quarters of FY 1999, the injury rate for OMH employees was 27 per 100 employees, almost doubled from 15 per 100 employees in 1997/98. The rate of patient assault injuries for all OMH staff in 1996/97 was 7.6 assaults per 100 staff. The rate of restraint-related injuries was 5.8 injuries per 100 staff. PEF’s own studies of OMH wards that house the most dangerous patients show injury rates up to 2 injuries per employee per year. Most of these 30 patient wards are staffed 90% of the time with only a nurse and two or three therapy aides. This is not a therapeutic environment. All this evidence indicates that OMH needs to increase their staff-to-patient ratios to reflect the qualitative changes in its residential population.

Both staff and patients will also be negatively affected by the Governor’s proposal to create regional appointing authorities. This would transfer the control over where employees can be assigned from each individual facility director to the Commissioner of OMH. While some other State agencies do centrally control all appointments, reassignments, and transfers, the nature of the therapeutic relationship is unique and demands the protection that comes with local autonomy.

Facility directors are less likely to disrupt long-term staff/patient relationships in order to satisfy a bureaucratic demand for personnel changes. Facility directors are also more responsive to local needs by virtue of being in the community they serve.

It is contradictory to promote the philosophy of community control through the Community Mental Health Reinvestment Act while at the same time proposing the removal of local accountability through this proposal.

This proposal is also unnecessary. Last year the Legislature enacted legislation that was signed by the Governor that made Section 78 of the Civil Service Law permanent. This law allows the State to move employees across layoff units in order to move employees where they are needed and to avoid layoffs. It also contains provisions that protect employees’ seniority and give them some choice in the job assignments they are offered. The Governor’s proposal to create regional appointing authorities in OMH is simply a way to get around the employee protections contained in Section 78 of the Civil Service Law. It will allow OMH to hold over employees’ heads the power to reassign them hundreds of miles from their homes without regard to their seniority, which they cannot do under current law.

Another problem with the proposal is that the regional appointing authority groupings are not consistent with the regional layoff units we have negotiated with OMH. This will allow OMH to change individual employees’ layoff units, which may violate our contract. For example, OMH employees who work in Nassau and Suffolk counties are currently in their own layoff unit. This proposal would include those employees under the same appointing authority as employees at the Creedmore and Queens Children Psychiatric Centers. This means employees at Pilgrim Psychiatric Center can be reassigned to Creedmore, a commute of one and one-half hours, without regard to their seniority. This would change such an employee’s relative seniority, and if a layoff occurs would allow such employees to be involuntarily relocated as far away as the Bronx Psychiatric Center. If the employee turns down a reassignment, it is considered a voluntary layoff. The law does not currently guarantee that employees in such a situation would get “preferred list” and “reemployment” rights to similar jobs that later open up in State service.

This proposal would expose OMH employees across the state to the possibility of similar unfair treatment, diminishment of their current civil service rights, and long commutes up to one and two hours from where they currently work. It combines the currently separate layoff units for Elmira and Binghamton Psychiatric Centers, grouping employees who work in Broome, Chenango, Cortland, Tioga, and Delaware counties with employees who work in Seneca, Schuyler, Steuben, Tompkins, and Chemung counties. Currently employees who are assigned to the Central New York and Elmira Psychiatric Centers are in the same layoff unit. Under this proposal they would have different appointing authorities but would remain in the same layoff unit.

The Governor’s proposal also combines the layoff units of Mohawk Valley, Central New York, and Hutchings Psychiatric Centers into one regional appointing authority covering Oneida, Herkimer, Otsego, Onongaga, Madison, Oswego, Cayuga, Seneca, Schuyler, Steuben, Tompkins, and Chemung counties. In addition, it combines the layoff units of Rockland Children’s, Nathan Kline, Middletown, Mid-Hudson, and Hudson River Psychiatric Centers into another regional appointing authority encompassing Rockland, Westchester, Sullivan, Ulster, Dutchess, Orange, Greene, and Putnam Counties.

There is nothing more disruptive to employees than losing their current jobs and/or involuntarily changing where they work. Currently, when such personnel decisions are made there are rules and procedures in place to ensure they are made in a fair and objective manner that protects all employees’ seniority and civil service rights. This proposal would allow OMH to target individual employees for reassignment without regard to their seniority, change their layoff unit, and change their relative seniority. The Legislature wisely rejected a similar proposal just two years ago. We urge you to do so once again.

Similar issues of continuity of treatment and employee dislocation are raised by the treatment of shared staff in this proposed budget. The budget includes funding for only the 66 shared staffing positions restored by the Legislature in the current fiscal year. Despite the requirement that OMH report to the Legislature by October 31, 1999, we continue to have no information on the distribution of the 215 shared staff in question. Without such information we must assume that the issues raised this fiscal year are still relevant to the coming year’s budget.

This proposal requires professional employees to transfer to the psychiatric center which issues their paycheck, but where many if not most of these employees have never worked. In many instances their worksites and homes are well over an hour away from the psychiatric center that issues their paychecks.

These employees provide a wide array of services in the counties where they work. They are found in clinics, emergency psychiatric services, day treatment programs, case management, and residential settings. Shared staff titles include psychologists, psychiatrists, social workers and nurses, all a valuable part of the county mental health services community. These employees provide services that prevent their clients from needing the compulsory outpatient treatment imposed by Kendra’s Law. Their clients will needlessly suffer from the disruption of their treatment.

The Governor’s local assistance increases for case management and assisted community treatment will not directly replace all of these employees, particularly in clinics in remote areas. Even with additional funding, counties will undoubtedly have a difficult time hiring replacement staff with this degree of qualification, training, experience, and dedication.

Where counties are able to offer PEF members similar positions, it is clear the counties will not have the resources to compensate these shared staff at a rate comparable to that which they currently receive as employees of the Office of Mental Health. Shared staff will be placed in the distressing position of either accepting a significant reduction in pay and a disruption in seniority and benefits, or abandoning the clients and communities they have served for many years.

We once again ask the Legislature to restore all 150 OMH shared staff positions to ensure continuity of care for their clients.

OFFICE OF MENTAL RETARDATION AND DEVELOPMENTAL DISABILITIES (OMRDD)

Like OMH, OMRDD’s budget shows a shift of staffing from Institutional Services (a reduction of 531 annual average salaried positions) to Community Services (an increase of 854 annual average salaried positions). This is due in part to the transition of 250 consumers from developmental centers to community settings. However, an increase of 24 new Regional Behavior Intensive Treatment Unit (RBITU) beds and 40 Intensive Treatment Unit beds (ITU) beds, as well as enhanced staffing for ITUs, should partially offset these reductions. Without additional detail it is difficult to understand the impact of this apparent shift in staffing. PEF is concerned that OMRDD has not guaranteed that as each client transfers to community-based care, professional State positions will follow from institutional services.

The staffing increase related to the expansion of secure and specialized units appears to be exclusively direct care staff, without a corresponding professional staff component. The clients in residence in these units have severe behavioral difficulties, are difficult to control, and often have multiple mental health and mental retardation disabilities.

A professional presence in these units is not only appropriate, it is required by OMRDD Section 483 regulations. These regulations call for a Qualified Mental Retardation Professional (QMRP) to: integrate, coordinate, and monitor each client’s active treatment program; implement the active treatment program by working directly with all staff who work with clients; carry out and monitor professional interventions for each individual program plan; and participate as members of the interdisciplinary team in the active treatment process. These QMRP positions include occupational and physical therapists, psychologists, psychiatrists, social workers, speech pathologists, audiologists, recreation therapists, and dieticians.

PEF believes that any expansion, particularly for clients of specialized needs, demands a detailed explanation of how professional services will be provided.

As in OMH, the needs of the people served by OMRDD have increased. At the same time, staff has been downsized and workloads have increased dramatically. As clinical staff (psychologists, recreators, social workers, program staff, etc.) have left due to layoffs, attrition, and other job opportunities, the remaining staff have picked up their caseloads. Where there is expansion of programming, there is often no concurrent expansion of staffing. Coupled with a decline in direct care staff and frequent staff substitutions, this downsizing is impacting client care.

OMRDD professionals report an increasing occurrence of client behavioral problems. Escalation of minor problems is common because the limited number of staff are focusing on more critical problems, such as assaults, sexually inappropriate behavior, destruction of property, and AWOLs. One of our psychologists characterized the result as “a slow but steady deterioration in the behaviors of some individuals, perhaps many individuals, due primarily to the fact that we no longer have the staff to do the job that is required for successful behavioral programming.”

In addition, the injury rate for OMRDD employees in 1997/98 (the last year for which data is available) was 19 injuries per 100 employees, more than twice the national average injury rate and 21% greater than the injury rate for DOCS employees. We suspect that this rate has increased as it has within OMH. The administration’s reluctance to share this information with PEF is an indication of this negative trend.

During deliberations on the 1999-00 budget, PEF proposed augmenting OMRDD’s quality assurance staff to enable effective oversight of existing community-based services and the planned expansion of those services under NYS CARES. Current State law (Mental Hygiene Law §16.11) requires inspections of community-based programs at least twice each year, with the exception of outstanding programs identified by the Commissioner, which require inspections at least once each year. This standard is clearly not being met. OMRDD’s own Survey Process Manual for HCBS Waiver programs refers to a three-year cycle of reviews.

We believe the infrequency of these inspections is partly responsible for some of the failures in private sector operations over recent years:

July 1999: The NYS Commission on Quality of Care for the Mentally Disabled issued a report documenting “widespread neglect of developmentally disabled residents and wrongful conversion of public funds at a not-for-profit-corporation in Jamaica, Queens….” The report details the gross misuse of public funds by the executive director of Project Independence of Queens (PIQ), including diversion of funds to purchase a home for her personal use and international travel for herself and her many family members on PIQ’s staff. Residents were meanwhile living in subhuman conditions, characterized by a pervasive odor of urine, roach infestation, lack of fresh food, and improper medication practices.

March 1999: OMRDD moved to take over operations at one of two homes operated by the Groton Community Health Care Center, following an “incident” in the home. The Ithaca journal (3/18/999) reported that 20-25 trained public employees from the Broome DDSO were stepping in to provide round the clock care for 21 people residing in the home. The Center’s operating certificate had been pulled in January.

February 1999: The Onondaga County Association for Retarded Citizens lost its operating certificate at its James St., Syracuse day treatment program. This prompted the immediate resignation of the organization’s director. At the time, the Herald Journal (2/4/99) reported that none of the 107 people served were “in any imminent danger….” The report, however, cited serious understaffing, shortage of medical personnel, and the private-sector “employees’ failure to understand their duties and the agency’s policies and goals.”

February 1999: A report released by the Commission on Quality Care revealed that operators of the Special Needs Program, Inc. near Hudson, NY siphoned off $752,000 in funds for their personal use from January 1994 through July 1997. This OMRDD-certified organization was licensed to provide residential care to 10 individuals with autism and other disabilities.

September 1998: The Independent Living Center of Amsterdam had its operating certificate pulled because the private agency “illegally misapplied Medicaid funds to underwrite an ill-conceived housing development” scheme. According to the CQC, the provider illegally used State and federal money to fund a retirement community; misled state agencies in how the monies would be used; solicited “donations” from clients; and took Family Support Services funds without having clients to serve.

The magnitude and rapid pace of NYS CARES expansion requires extra diligence by OMRDD’s quality assurance unit to ensure accountability for quality of care and fiscal administration.

Last year PEF recommended the addition of 33 staff based on the time required to perform surveys prior to the opening of new homes (serving 980 people) and programs (serving 190 people), and to perform annual inspections and reviews of homes once they are online. During this fiscal year, OMRDD received approval to add 29 additional program audit staff, and has sought approval to add six additional fiscal audit staff.

It is PEF’s belief that quality assurance capability should keep pace with the expansion of community development. Planned NYS CARES residential and day services expansion is identical to this year. We again propose a corresponding increase of 33 quality assurance staff.

The 1999-00 budget included a $10 million capital appropriation for 100 State-operated NYS CARES beds. Only twelve of these beds (staffed by 24 employees) are anticipated to come online in the next fiscal year. PEF questions the snail-like pace of this development when almost 1,000 privately operated beds are expected to be brought online in the coming year. OMRDD’s admirable level of determination in developing private beds should be matched by equal fervor in developing State-operated beds.

State-operated homes offer stability and consistency in an industry well known for high turnover rates and an inability to recruit skilled staff. State-operated homes offer professionally credentialed, highly trained and experienced staff. State staff provide comprehensive services-including residential services, day programming, vocational and work-related training, and clinic services-all from a single provider. It is in the best interests of OMRDD’s clients that the approved beds get online quickly and that new funds are appropriated for additional State-operated beds in the following year.

Reject any changes in the appointing authority at OMH.

Fully restore shared staff funding.

Maintain inpatient staffing levels appropriate to the number of patients.

Maintain a fully staffed professional component to all secure and specialized OMRDD facilities.

Accelerate development of State-operated NYS CARES beds, and add additional beds for 2001-02.

Provide additional quality assurance staff corresponding to new NYS CARES beds.

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We would now like to discuss an issue that cuts across all State agencies - the increased amount of work performed by consultants. This problem is most acute in the Department of Transportation.

We oppose the Executive Budget’s proposals to contract out to consultant engineers, work that is currently performed or has been performed by State employees at the Department of Transportation (DOT). The State Comptroller has clearly proven that outside consultant engineers are more expensive than State engineers. We do not understand why the Executive Budget continues to make and the Legislature approves these unwise and costly proposals.

Within DOT, PEF currently represents approximately 5,049 employees, down about 100 employees from January 1999. Between January 1995 and January 1998, DOT eliminated 691 competitive positions represented by PEF, almost 300 of which were engineering titles. Between January 1998 and July 1999 the State added about 150 state employees in engineering titles. However, since July 1999 DOT has lost 102 employees in engineering titles and now has 661 vacancies in those titles. The evidence is clear: DOT is not recruiting or retaining employees in their engineering titles. However, instead of aggressively recruiting engineers and raising engineering salaries, the State has chosen to rely more heavily on consultant engineers who are much more expensive for the State to use even if they raised State engineers salaries.

When PEF testified before you last year, we explained that reducing the number of State-employed engineers while increasing the State’s reliance on more expensive engineering consultants was poor public policy and a waste of tax dollars. The fact that State-employed engineers are less costly than private consultants is well documented. Two different audits, one issued in 1990 by Comptroller Ned Regan and one issued in April 1998 by Carl McCall, both concluded that it costs substantially more to hire private engineering consultants and the State could save money by hiring more in-house employees at DOT. Comptroller Reagan estimated that consultant engineers cost 65% more than State engineers. Today, PEF estimates that consultant engineers cost almost 80% more than State engineers. Even Governor Pataki, during his 1994 campaign, estimated that the State could save an estimated $180 million annually by reducing its reliance on consulting engineers.

Comptroller McCall’s recent audit concluded that many of the private contracts were for routine services that could have been performed at a lower cost by State employees. The report indicates that not only are there huge salary disparities between private contractors and State employees, but the indirect costs are also higher. In fact, the report showed that while DOT spends millions of dollars on the indirect costs associated with the private contracts, the addition of in-house employees would add little to the Department’s indirect costs.

For example, the Comptroller’s report estimated that DOT paid approximately $85 million in consultants’ indirect costs for projects during the 1996-97 contract year. In contrast, since most of DOT’s indirect cost components are fixed, hiring more in-house employees would increase these costs only slightly. Thus, with limited funds, hiring more in-house employees and fewer private contractors would free up more money to be used for capital projects such as roads and bridges.

DOT’s own in-house pilot project demonstrated that using DOT employees to inspect bridges was more cost-effective than using private contractors. And yet, DOT continues to hire private contractors to inspect all State and local bridges in the New York City region. In addition, DOT continues its policy of splitting construction supervision projects 50-50 between private contractors and in-house employees. This 50-50 policy began with the advent of the accelerated bond era, during which DOT needed to augment in-house staff by hiring consultants. However, with the current budget’s emphasis on a return to a more predictable base year capital budget, this policy should end and more construction supervision can then be performed in-house with greater cost savings.

Last year the Executive Budget proposed to eliminate 197 more engineering positions at DOT. The Executive also recommended a lump sum $547.4 million appropriation for the Engineering Services fund. In the past the budget specified how much would be appropriated for State employee engineering services and how much would be appropriated for consultant engineers. The Legislature added $20 million for engineering services. However, at the insistence of the Executive, it did not appropriate specific funds for State employee engineering services and consultant engineers as it had in the past and as it had in both the Senate’s and Assembly’s one-house budget bills. This was a deliberate action by the Executive to keep vital information from the Legislature and the public in order to cover up its wasteful use of consultant engineers. The result was a loss of 102 State employee engineers and a greater reliance on more expensive consultant engineers.

The proposed Executive Budget cuts the Engineering Services fund by $500,000 and calls for a decrease of 4 positions from DOT’s current fill level for their Design and Construction Program. Once again, this is a lump sum appropriation which does not provide a specific appropriation for state employee engineers. This proposal ensures that the State will continue to rely on over-priced consultant engineers and will continue to run down its State employee engineer workforce. This proposal does not make sense and will cost State taxpayers millions of dollars a year unless the Legislature acts to stop this insanity.

Clearly, it is in the best interest of the public to have experienced and well-trained State engineers performing more of the work necessary to rebuild our roads and bridges. Contractors are only necessary to handle short-term work in peak construction periods. Both a Republican and Democratic Comptroller have agreed that using consultant engineers for a base capital program wastes millions of taxpayers’ dollars. Don’t let DOT continue to squander taxpayer dollars on this poor public policy. Restore the 102 engineering positions the Executive cut last year by filling some of the current 661 vacancies in these titles. You can pay for these positions with the money saved from reducing DOT’s wasteful reliance on consultant engineers.

The Executive Budget proposes a $14.3 billion five-year Capital program with $8 billion for highway and bridge construction that averages $1.6 billion annually. This proposed capital program is inadequate in light of the fact that New York’s roads and bridges have been ranked 43rd in the nation and need $26.5 billion to repair and reconstruct them over the next five-years.

The highway and bridge capital program needs to be expanded by the Legislature. However it is expanded, we implore you to deal with the waste of state taxpayer dollars through DOT’s over reliance on consultant engineers. Maintaining a strong State employee engineering workforce is the State’s best weapon to ensure that the billions of dollars to be spent on its transportation capital program are spent wisely.

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We are very supportive of the Governor’s proposal to increase staff in the Child Care program for the purposes of increased oversight and monitoring activities and increased inspections for registered programs. However, we are a little concerned about the funding for these new positions. The budget does not clearly state where the money is being allocated. We will be watching this process very closely to make sure that the positions are created and filled as proposed.

The latest Executive Budget Appendix I contains the following passage relating to the CONNECTIONS program: “During 1999-2000, a State review involving local governments and other stakeholders identified the needs for a third party technical expert to guide improvements to the CONNECTIONS software application and hardware infrastructure.” We would translate this statement as follows: “After spending over $220 million so far, the people who have to actually use the system tell us it still doesn’t work. We have therefore decided to hire another consultant at exorbitant rates to try and fix the mess left by the first consultant.”

Enough is enough. This is a system of critical importance. It is a flawed system. It gives us no joy to say “we told you so,” that we foresaw how this scenario would end. We are not happy that the local providers and counties are not able to have the information they need at their fingertips. We are even less enthused by the Governor’s proposal to throw good money after bad by bringing yet another consultant on board. It is time to do the right thing by hiring state employees to make this system work. It is time we all agree that the CONNECTIONS contract was a mistake and that we should stop repeating the mistake. It is time to fix the problem and move on. This money should be appropriated to personal services and the Office of Children and Family Services should hire the necessary state employees in data processing titles to fix the problem and keep this vital resource functioning and up-to-date.

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The Executive Budget makes three recommendations regarding the State Education Department (SED) that concern us. The first relates to the transfer of the State Library, Archives and Museum to the Council on the Arts. The second relates to the consolidation of the Office of the Professions and the Higher Education Program forming the Office of Higher Education and the Professions. The final recommendation that concerns us would require SED to submit a staff deployment plan that would accommodate a 10% reduction in staff.

Overall, the Executive Budget proposes a reduction of 58 positions in SED that will be lost through attrition. We should not be cutting staffing in the Department when we are asking these employees to assist schools in meeting the new education standards the Regents have recently instituted. We are particularly concerned about the $100,000 cut in funding for the Office of Facility Planning. The Legislature added this funding last year in order to accommodate the additional services necessary to assist school districts in the major capital school-rebuilding program the Legislature began to implement.

While PEF certainly supports the Arts in New York, we are concerned that the State Library, Archives, and Museum are being characterized as “Programs related to cultural development and promotion….” While a few people may mistakenly be convinced that the State Museum falls under that rubric, the State Library and State Archives clearly cannot be characterized in this matter.

We believe that all three are very successful, very valuable educational institutions. This Governor is very interested in promotion. We are very interested in providing services. These institutions provide valuable services to many New Yorkers, not related to cultural promotion but related to learning. As such they should remain in the State Education Department.

The Executive Budget proposes to consolidate the Office of Higher Education and the Office of Professions into an Office of Higher Education and the Professions effective October 1, 2000. It would also cut the appropriation for these combined programs by $836,100, although the budgeted fill level for the combined programs is slated to increase by 2 positions for a total full-time equivalent workforce of 549 positions.

This consolidation proposal makes no sense. Both offices have separate and distinct customers that have different problems and issues. Currently there is no duplication of services to the customers of these offices as the Executive claims in its budget proposal. The Executive Budget offers no other rationale for this consolidation proposal. The State employees who work in these offices are certain that services to their customers would be negatively impacted by this proposal, as it would impose a new bureaucratic structure that will bottleneck decision-making. The Governor’s Office of Employee Relations recently gave the Office of Professions its Workforce Champion award for the service improvements the office has made over the last several years. We have no idea why the Governor wants to “fix” an office he admits is providing exemplary service.

We urge the Legislature to reject this unwise proposal and fully restore the funding for these offices.

The Executive Budget recommends eliminating the State’s role in oversight of college and university academic programs. The Executive Budget claims this is a needless duplication of effort. We disagree. This is a necessary function of state government. We are frankly very concerned about any accreditation that is conducted by the private sector. We are especially concerned when the removal of the state from an oversight function is viewed as providing “regulatory relief for higher education institutions.”

Do we really want less regulation of higher education? We believe the answer is a resounding NO! The employees in the Office of Higher Education provide a valuable service by ensuring that diploma mills do not take advantage of students and State taxpayers. This regulatory function actually saves taxpayers dollars by ensuring that TAP money does not go to institutions that do not provide quality education to their students. We cannot trust the private sector to perform this important function.

In addition to the staff reductions proposed in this fiscal year, the Executive Budget requires SED to submit a staff redeployment plan to streamline its remaining operations and reduce its General Fund staffing by 10% by March 31, 2001. In addition, the Governor proposes to limit SED administrative costs against Federal grants to 5% of such grants. No rationale is offered for either of these proposals. Once again the Governor blindly attacks the State Education Department. He is demanding a 10% reduction in staff for no stated reason. He simply wants them smaller. Why is that? Is it because he doesn’t control them? Perhaps that is why he is constantly seeking to reduce staff in this important agency.

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The Executive Budget fails to address the structural deficit in SUNY that is caused by the inability of SUNY hospitals to contribute $116 million in revenues to SUNY. This revenue target has always been unrealistic. At the close of the SUNY fiscal year, the SUNY hospitals fell short by about $77 million. It is unclear how last year’s deficit is handled in this year’s Executive Budget.

We propose that the following considerations should be taken into account in developing a solution to the SUNY budget gap:

The deficit problem is real. Administrative tinkering will not solve it.

The budget problem is not just a hospital budget problem - it arises from the hospitals’ relationship to the SUNY budget and affects the entire SUNY budget.

The SUNY teaching hospitals are part of SUNY’s educational mission, and education and research in the health sciences is an integral part of SUNY’s mission.

The problem cannot be solved by cutting staff at the hospitals or by reducing workers’ rights, wages, or benefits. Not only would this be unfair and wrong, it simply will not work. The hospitals cannot produce revenues without staff to operate and maintain quality of care.

Any solution will require a commitment to continued state support of the SUNY hospitals.

Hospital flexibility legislation should be part of the solution, but it cannot be the whole solution.

Flexibility legislation is acceptable. Privatization or attempts to undermine workers’ rights are not acceptable.

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In closing, Mr. Chairman, we urge you to:

1. Reject the proposal to cut funds for law enforcement and rehabilitation and to merge several agencies into a new Department of Justice.

2. Reject any changes in the appointing authority in OMH

3. Fully restore OMH shared staff positions.

4. Maintain appropriate inpatient staffing in OMH and restore the 100 positions cut at Pilgrim and Manhattan PCs.

5. Provide for adequate professional staff in all OMRDD facilities.

6. Provide additional quality assurance staff for the NYS CARES expansion.

7. Add more State-operated beds for NYS CARES and accelerate development of beds already funded.

8. Require DOT to hire more state engineers and reduce its reliance on costly consultants.

9. Hire state computer professionals to fix the Connections program in OCFS - no more consultants.

10. Reject the Executive’s proposal to cut the State Education Department and to abolish or transfer out key functions in SED.

11. Provide adequate state support for the SUNY hospitals to eliminate the structural deficit.

Thank you for your time and consideration.