OMCE Proposals for Budget Savings Measures
Workforce
M/Cs must be treated no less well--should not be treated differently than other employees with regard to compensation and benefits—no salary or other withholdings for M/Cs only.
1. Reestablish and reinforce “State as a single employer” policy.
A. Re-evaluate Department of Civil Service processes and procedures for managing the workforce such as the:
1. Reverse the Civil Service Department's decentralization of its staffing and testing responsibilities to agencies.
2. Focus on recruitment instead of career mobility, (which is critically important in a period of fiscal crisis).
3. Need to identify staffing and talent needs, evaluate current staff talents, identify matches that can be made, identify and prescribe training needed.
4. Need for a comprehensive plan from CSD of how to manage any possible workforce reorganization given decentralized staffing.
B. We should manage the State workforce through turnover and the hiring freeze. No layoffs should be necessary. Turnover = 14% in classified service and 10% in all categories.
1. Hiring freeze must apply to political appointees too.
2. A talent management computer based human resource system needs to become the principal mechanism for redeploying, retraining and rehiring the workforce. In short, agency missions define human resource needs. These needs are identified for requisite talents (knowledge, skills, experience). Employees talents are identified, stored (and updated), and matched to job needs (job orders). Talent deficiencies should be remedied through short term and long term training using internal and external training resources. Upon successful completion of the remedy, the employee achieves permanent status. This initiative appears to be compliant with current law, rule, regulation and practice. Result will be an employee redeployment system that functions at all times and not just during a crisis
2. Consider exempting OMH, OMRDD, OCFS, SUNY Medical Centers direct care staff from hiring freeze.
3. Continue to reduce number and use of consultants and contractors. Use state employees and provide any training that might be required.
5. OMCE proposes a new Succession Planning Incentive which would pair a retiree with a successor eligible for appointment to the position being vacated. The retiree (mentor) would work, under Section 212, 50% time at 50% pay for 6 months; the successor would work 50% time in current position and 50% time in the vacated position and would be trained to perform that vacated job. Potential savings if no back fill could reach $65, 000 per pair. (See attachment)
C. Charge Task Force on retiree health insurance to identify cost saving options without reducing /eliminating coverage or increasing or imposing additional contributions, (e.g. explore implementation of 2 person coverage category, coordinating prescription drug purchases with other programs, possible Medicare Advantage Plan savings, cash buyouts to employees who agree to be covered under a spouse’s or domestic partner’s health insurance.
Non Workforce
1. Taxation Issues:
A. Collect taxes on cigarettes, fuel and consumer goods purchased on Indian reservations by non-Indians.
B. Support additional taxes on high wage earners.
C. Collect outstanding taxes -- explore whether businesses with tax warrants filed against them are getting tax breaks.
D. Consider circuit breaker
2. Public Administration:
A. Actively work to encourage local government shared services, and move toward mergers and consolidations. The Government Law Center is working with the Department of State and provides technical assistance to local governments.
B. Expand and encourage use of BOCES for central administrative functions for school districts, e.g., purchasing, computer services.
C. Reduce duplication and/or overlapping responsibilities, e.g., many agencies doing investigations, duplicating what other agencies are doing---OSC, Tax, A/G, SIG, Public Integrity, OMIG, Agency IG -- and IGs doing inappropriate work, e.g. labor relations.
D. Review numerous and growing number of agency hotlines, for possible consolidation or elimination- -- explore alternatives such as support for 211 to do initial screenings and referrals so state agency staff are working with those who appropriately need that agency/program’s services.
E. Review / possibly reduce funding for projects like AMD (AMD spin off funded by Abu Dhabi), Albany County Convention Center (revisit PILOT payments instead for Albany), Empire Zones
F. Stop renovating offices for high level staff and new appointees; stop leasing equipment, furniture, etc. -- use OGS surplus furniture/equipment. Don’t lease new cars for agency heads unless warranties expired; review need for and use of cell phones, blackberries, treos, pda’s if employees have more than one of these devices,
G. Encourage local governments to participate in NYSHIP, state procurement and purchasing and other programs if more cost effective than their current local practices.
ATTACHMENT
Purpose:
To provide a human resource management tool that provides for defined future personnel and program needs while affording significant savings to the employer without any need for reductions in the current workforce or public services.
Savings:
It is estimated that 2500 – 3000 such incentives would be offered. New York State, as the employer, could save as much as $200 million.
Method:
This will be an agency driven process. All plans must be submitted to and approved by a majority of a committee comprised of the Director of DOB, the Commissioner of Civil Service and the Director of GOER or their respective designees. An agency will seek volunteers from appropriate employees anticipating retirement, and from those eligible or assuming eligibility for ultimate advancement to the position being vacated by the retiree (hereafter referred to as the mentor).
Upon retirement, the mentor will agree to return to work under Section 212 of the R&SS Law on a 50% schedule at 50% pay for 6 months. The successor employee would continue working in their current position for 50% of the time at 50% of that position’s salary and would work for that same 6 month period alongside the mentor employee receiving training for the mentor position. The successor employee would receive 50% of the appropriate targeted position’s salary while working half time in that position.
The mentor employee will train the successor employee per an agency approved plan. Time spent in this position by the successor employee will be prorated appropriately toward any applicable probationary period. The employer will save half the salary and fringes for the successor employee’s present position for 6 months, plus savings on the salary and fringes for the mentor employee (which fall from approximately 45% to 24% (see chart).
This job sharing will provide hands on mentored succession planning that is real, as well as giving the State significant savings with minimal human resource and program disruption.
At the completion of the 6 month Section 212 appointment, the mentor will have their FAS recalculated to reflect the Section 212 salary as if received in their greatest salaried year used in the FAS calculation. Their retirement allowance will then be actually re-calculated to reflect those increases.
Additionally, the mentor will have the option to purchase up to the 6 months service (prorated) as additional service time. Such additional credits, if purchased, could not exceed the maximum service credits for retirement under the applicable laws and regulations.
Savings Analysis:
Assumptions:
3000 Succession Plans created in State Workforce (6000 participants).
$56,628 = average salary
$82,667 = average total compensation (all fringes)
24% = (percentage of average salary for Section 212 employee fringes)
1st 6 Months of Plan
Salary Mentor: = (6 months of ($56,628) average salary x 1/2 (.50%))
$14,157 = Mentor average salary for 6 months 1/2 time
$ 3,400 = Fringes for Section 212 employee (24%)
$17,557 = Avg. Total Cost for Mentor
Successor Candidate: $41,334 = Total 6 month average cost (1/2 current position ($20,667)) + (1/2 target position (20,667)).
$58,892 = Total salary cost for 1 Initiative {6 months §212, 6 month employee)
$82,667 = 2 positions total cost for 6 months
-$58,892 = Succession Planning (1 pair) total cost
$23,775 = Savings – 1st 6 months
2nd Six Months
$82,667 = 2 positions, 1/2 year total cost
$41,334 = New target position/50% of annual total cost
$41,334 = Net saving next six months (assume no back fill)
$23,775 = Savings during six month succession plan
$41,334 = Savings 6 month total cost for 1 less position
$65,000 = Per Plan Total Savings (Rounded)
Assumption: [Based on Civil Service, DOB and OSC Data)
3000 plans enacted within the State Workforce
$56,628 = average salary state workforce (08-09)
$82,667 = average total compensation (includes all fringes @ 46%)
24% = fringe benefits % of salary for those employees on §212 waiver
1st 6 Months of Plan
Mentor Successor Employee
50% of 50% of average salary = $14,157 $20,667 = 6 mo. 50% total cost, current position
24% fringe benefit costs = $ 3,400 $20,667 = 50% total cost, target position
6 month cost for mentor = $17,557 $41,334 = total 6 mo. total average cost
$82,667 = average 6 month total cost for 2 positions state workforce
- $58,892 = average 6 month total cost for 1 Succession Plan (2 employees)
2nd Six Months
$0.00 = Mentor cost
$41,334 = 2nd 6 month total cost for Succession in Target position
12 Month Cost
$58,892 = 1st 6 month Total cost Succession Plan
$41,334 = 2nd 6 month Total cost Succession Plan
$100,226 = TOTAL cost for 1 Succession Plan
Savings
$165,334 = Total Cost 12 month for 2 state workforce
-$ 100,226 = Total Cost 12 month for1 Succession Plan
$ 65,000 = Savings to Employer – Per Succession Plan (rounded)
Projection:
$65,000 = Savings to Employer per Succession Plan
x 3000 = Enacted Succession Plans
$195,000,000 = Projected possible savings (rounded)
Summary:
Appropriate section of Retirement and Social Security Law and possibly others will need to be amended to allow for the mentor employees FAS recalculation and optional purchase of service credits outlined in this proposal.
It is assumed that all pertinent Civil Service law, rule and regulation for the selection of successor participants will be followed where applicable.
Given a 10% attrition rate for all state employment (235,000) in all branches (14% in classified service), there would be a 23,500 FTE turnover. Given that fact, it is entirely possible to manage this initiative without any forced separations of service.
Additional OMCE Proposals for Budget Savings Measures
Workforce
1. Re-evaluate agency requests to Civil Service and Budget for the creation or re-establishment of EXEMPT class positions. Such as:
· DHCR-Department of Housing and Community Renewal
4 additional positions of Assistant Commissioner in the Office of Rent Administration. Utilize the best practices of succession planning and upgrade existing high level experienced managers into these positions. Any backfilling of vacated positions should follow the current budget guidelines on such hiring.
· Commission of Quality Care and Advocacy
Advocacy Specialist 3 and Advocacy Specialist 5. Positions such as these are prime positions for career mobility opportunities for state employees who possess these special skills and/or have a background of advocacy.
2. Encourage agencies to explore, promote and expand the use of VRWS (Voluntary Reduction in Work Schedules), telecommuting and other forms of alternate work schedules pursuant to all applicable collective bargaining agreements, law rule and regulation. Significant savings can be realized in this area. Unfortunately recent agency experiences have shown a reluctance to embrace these measures as proven cost savings initiatives. Indeed the Alternative Work Schedule guidelines recently published by Civil Service did little to revive interest in this issue.
NYSHIP-New York State Health Insurance Program
1. Review the efficacy of allowing the establishing of a consultant contract to perform an Employee Benefits Eligibility Audit. The audit would ensure that State and participating municipal employees and their dependents receive only the benefits for which they are eligible as NYSHIP program participants’ legal dependants.
The original idea proposed (see Executive Budget Agency Budget submission for 08-09) was for funds to be allocated to the Department of Civil Service/Employee Benefits Division to develop an increased internal capacity to perform this and other such audits. Regardless of the terms of this contract, the need for developing this internal capacity or better using this capacity where it already exists (State Comptroller’s office for one) is paramount.
2. Establish the “Debit Card” component for the Medical Flexible Spending Accounts program. Such a “paperless” option will increase participation in this pre-tax program and the state, as the employer, will see additional savings for those payroll costs that are salary based (like FICA etc.).
3. Increase the audit supervision and contractor compliance for the component parts of the NYSHIP program and seek legal recovery where necessary. As stakeholders in the program the unions and OMCE have led the way in litigating NYSHIP contractors. The Office of the Attorney General followed our lead and instituted corollary suits against Express Scripts and United Health Care. This is NOT about who sues first but about “who’s minding the store”. Settlement discussions at all levels are now occurring and should bring the state upwards of $200 million or more in revenue/outstanding claims settlements. Again, ongoing NYSHIP internal compliance audit and review must be strengthened.
4. Reduce or eliminate NYSHIP’s discretionary advertising spending. The need for billboard, bus and public TV program sponsorship in this time of fiscal austerity must be reviewed. Employees and employers eligible for NYSHIP programs get the message from many fine internal publications.