The following summarizes relevant portions of the legislature’s budget as reported out by the conference committee last week. Mitt Romney may veto outside sections, line item language or funding relevant to us. The legislature may then choose to override those vetoes. The legislature will also probably allow some vetoes to stand. Romney will return his vetoes to the legislature on June 30^th, and we anticipate the legislature will take up overrides that week. Obviously we will be working hard to pressure the legislature to override any vetoes that adversely affect our members. We hope that this summary is helpful to you in answering members’ questions.

Almost every single program/service/line item in the budget sustained a cut. In some cases, those cuts are quite significant. Total local aid was cut by 20% (although the specific cut to individual communities varies quite widely). UMass was cut 20%, while the state and community colleges were cut 15%. The list goes on and on. These funding cuts will definitely result in layoffs. The estimates are 2,000-3,000 layoffs of state workers. Municipal layoffs will vary by community, but will be quite significant. In short, the $$ situation is bleak. Which is to say that we must continue to pound away on the need for a revenue package!

The legislature’s budget includes an Early Retirement Incentive Program (ERIP) for state employees. It provides a 5-year incentive for Group 1 only. The enrollment period is July 15 - September 1. The retirement date will be October 1, except for some higher education people who will retire on December 30. Accrued vacation and sick leave will be paid out over a four-year period beginning (we think) July 1, 2004. Federal, trust, and capital funded workers are eligible.

For those of you interested in municipal early retirement, that piece is included in the Municipal Relief Bill, which is currently in conference committee. Our best guess is that bill will emerge and go to the Governor’s desk sometime in the next two weeks. That is also a five-year incentive and is provided to communities under a local option. It is very similar to the one that passed a year or so ago.

Workers earning less than $35,000 per year will stay at the 85%-15% premium ratio, while everyone earning more than that will go to 80%-20%. New employees will be at 75%-25%. There is language that states that the premium ratio will go back to 85%-15% in 2005, but to be perfectly honest, we are very skeptical about that actually happening. We suspect that we will have to live with this new premium split in the long term.

There is very strong language protecting the hospital from closing. The language requires a study of the impact of closing and prevents closure without the express approval of the legislature. We anticipate that Romney will veto this language and an override will be necessary.

There is moderately strong language protecting the school. It prevents closure before October 2004, and requires some patient protections. Romney may veto this language as well, and an override will also be necessary.

We did very well on the Pacheco Law. There is a technical language change that alters how proposals are evaluated that we think will have a very minimal impact. In addition, the threshold the service must cost before the Pacheco Law applies is increased from $100,000 to $200,000 and indexed to inflation. There is no privatization of services, and no agencies are exempted from the law entirely.

The MDC is dismantled and its functions moved to a new "Department of Conservation and Recreation." This new Department will also include the functions of the former Department of Environmental Management. Within the new Department, there are several divisions into which former MDC workers will be split. However, the budget includes very strong worker protection language (for all transferred workers, not just MDC workers) that should serve to protect both workers and the integrity of the MDC bargaining unit.