Agencies: Employees pick bonus, retirement

More state employees have opted to take a one-time bonus and retire as agencies continue to struggle to keep their budgets in balance, a governmental advisory panel heard Tuesday.

But state agencies need to prepare for a more dire financial situation next fiscal year when the state is looking at a $1 billion decline in state revenue — and stop working on the edges, advisory panel chairman state Rep. Jim Morris said.

Civil Service official Judy McGimsey told panel members the retirement incentive is just one of the tools available to help state agencies get over temporary fiscal problems.

Other options are job furloughs, reductions in work hours or withholding of merit pay but those steps can only go so far, McGimsey said.

Agencies must figure out what they need to do in the longer term if fiscal conditions do not improve, she said.

Employees with State Group Benefits may lose jobs

Hundreds of state employees could soon lose their jobs thanks to streamlining efforts. An effort to compare state insurance coverage with private providers could put most employees from the Office of Group Benefits out of work. Right now that comparison process is just getting started.

The Division of Administration is currently working on officially asking private insurance providers to give price estimates, so they can compare those numbers with state costs.

Private companies already administer two of the three available insurance options for state employees. The third option is run by the Office of Group Benefits, but thanks to a new bid process that could change.

In the next couple of weeks, state officials say they will get estimates from other providers. They will then pick the highest quality and most cost-efficient choice. If the insurance provided by the state doesn't measure up, about 200 workers could lose their jobs. Governor Bobby Jindal says in the long run he thinks it will help more state workers by providing better coverage.

The CEO of the Office of Group Benefits says he expects bids from other providers by the end of the month. Sometime after that, they'll know if hundreds of their employees will lose jobs.

State Agencies cutting jobs as budgets shrink

All across Louisiana government, agencies are cutting personnel costs to adjust to smaller budgets in difficult times. So far in the fiscal year that began July 1, the effect is not deep, but it is sweeping in its scope. And it could represent a reversal of the payroll expansion that for many years has been a consistent trend in Louisiana, with the exception of the aftermath of Hurricane Katrina.

Strategic decisions, such as closing New Orleans Adolescent Hospital and streamlining Charity Hospital operations, certainly have reduced the number of state workers.

But the primary driver appears to be dramatically lower state tax revenue and oil and gas income, a situation Gov. Bobby Jindal and the Legislature chose to accept during the spring session rather than increase taxes. The governor has warned that the worst might be yet to come, as bailout money given directly to Louisiana from the federal government's economic stimulus package runs out in two years.

The Office of Civil Service is handling an extraordinary number of requests from agencies seeking permission to implement layoffs or layoff-avoidance measures, such as work-time reductions or ceasing the usual annual practice of giving employees 4 percent pay increases. In fiscal 2008, civil service had 11 such requests; in fiscal 2009, it had 77 requests -- including 42 in June alone.

In recent weeks civil service has approved layoffs for more than 50 state institutions. Most managers will be implementing those this fall, and the total body count has not yet been tabulated. New rules have given agencies more flexibility in handling staff adjustments, and seniority is less a factor in deciding who goes and who stays.