Legislation to End State Furloughs Sooner Is Sent to Governor

On a bipartisan vote, legislation ending furloughs for state workers in departments that aren’t paid out of California’s cash-starved general fund was sent to Gov. Arnold Schwarzenegger by the Senate on March 8.

The measure, SBX8 29, was sent to the GOP governor on a 27 to 7 vote by the 40-member upper house.

‘This is absolutely the right thing to do,” said Sen. Dave Cox, a Fair Oaks Republican, in support of the bill. “We need to move on from where we are.”

Authored by Senate President Pro Tempore Darrell Steinberg, a Sacramento Democrat, the bill would also exempt employees of the Franchise Tax Board and Board of Equalization from furloughing. The rationale is that more audits and tax collections would occur if employees at the two collection agencies returned to fulltime work.

A study by the Senate Office of Oversight and Outcomes compared furlough savings to revenue generation at the tax board and Board of Equalization. The report says California has lost $6.36 for every dollar saved through furloughs at the Board of Equalization and $7.15 for every dollar saved through furloughs at the tax board.

Some 70,000 employees work at departments, like Motor Vehicles, which are not paid for from the general fund. There are an additional 9,000 employees at the two tax collection agencies.

Two-day-per-month furloughs began in February of 2009 and were increased to three days per month in July of the same year.

The three days without pay represents a nearly 14 percent pay cut for state workers.

During the current fiscal year, which ends June 30, the furloughs are supposed to save $2.5 billion.

In his proposed budget for the fiscal year beginning July 1, Schwarzenegger ends the furloughs.

When imposing the furloughs the Schwarzenegger administration weighed applying them only to general fund supported state agencies but rejected the idea fearing an exodus of employees from the affected departments to non-general fund departments.

If signed into law by the GOP governor, Steinberg’s law would take effect in 90 days giving employees in non-general fund departments a reprieve of three furlough days.

However, the Franchise Tax Board estimates that if its employees were allowed to work three additional days in June, it would generate $31.2 million in additional revenue for California.

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