Just days after Wisconsin Gov. Scott Walker signed landmark legislation stripping public workers of bargaining rights, lawmakers in Minnesota say they want to roll back benefits for public sector workers in the Gopher state.
Under a proposal two GOP state senators announced Monday, some workers would have to increase contributions to their pensions by more than half.
Minnesota has a complex patchwork of pensions for public employees. There are separate systems for state workers, for teachers and for most local government employees.
The contributions and benefits are set in a long list of laws. They're not negotiated directly between employers and workers.
Now, some Republicans say Minnesota needs to change those terms.
"We're just asking them, our good government employees, to take more responsibility for their own retirement," said Sen. Mike Parry, R-Waseca.
Parry is one of the authors of the bill. It calls for the state — as well as cities, counties and school districts — to cut pension contributions by 3 percent across the board.
“We're just asking ... our good government employees to take more responsibility for their own retirement.”Sen. Mike Parry, R-Waseca
Employees would make up the difference out of their own pockets, to keep the pension system whole.
Parry said it's a sacrifice that has to be made in light of Minnesota's projected $5 billion budget deficit.
"I would much rather work to where I can save jobs and keep people employed, than to have to do the drastic measure, because then they go on unemployment and we still end up paying," Parry said.
Parry also wants to shift state workers from a traditional health insurance plan to a high-deductible plan paired with a $2,500 contribution to a health savings account for workers and their families.
"This is a unilateral pay cut," said AFSCME Council 5 Executive Director Eliot Seide.
He said he hopes DFL Gov. Mark Dayton will block such changes.
Seide also said Minnesota isn't ready to follow Wisconsin's lead.
"I think this is precisely the plan laid out by Gov. Walker and the American Legislative Exchange Council, which is run by right-wing extremist billionaires and other cheap labor conservatives, to divide public workers against private workers and to drive down the wages and benefits of all workers," Seide said.
A comparison shows that the situations in Minnesota and Wisconsin are different already.
Before Wisconsin's so-called budget repair bill passed, public employees contributed little to their own retirement and health care. That's not the case here.
In Minnesota, public workers and taxpayers evenly split contributions, at rates varying from about 5 percent to 10 percent of salaries.
“This is a unilateral pay cut.”AFSCME Council 5 Executive Director Eliot Seide
Education Minnesota president Tom Dooher represents most of the state's teachers. He said his union members have already given back on pension issues.
"It's something that we've already been proactive and taken care of," Dooher said. "So we have made concessions, and we don't see this making the position stronger."
But economist Michael Mandel, a senior fellow at the Progressive Policy Institute in Washington, D.C., says the recent national debate over public workers is not just about buy-in for employees.
He said his research shows public sector health and retirement plans have fared better than in the private sector as the economy declined.
"People are upset about the benefits," Mandel said. "They're upset about the relative safety of the public sector versus the private sector, and they're upset about the fact that it appears to them that the public sector employees have created a zone of safety for themselves."
Republicans, though, say their plan is relatively straightforward.
First-year Sen. Gretchen Hoffman, a Republican who lives near Detroit Lakes, said she helped write the bill hoping to bring some parity with the private sector. But she said it's ultimately about the dollars and cents.
"The state and local employers pension obligations, it should help them by about $110 million per year," Hoffman said. "It could be a substantial amount of money."
That could help soften the blow of local government aid or school aid cuts, and help close the state's own budget gap.
So far there is no House version of the Senate proposal.