2022 Leg Session, Business/Economy, Exclusives, Gold Dome, Local, Uncategorized

Sharf: Hungry public-sector unions want local taxpayers on the menu

There’s an old saying that if you’re not at the table, you’re on the menu.  The citizens of Colorado are about to find out how true that is.

Rep. Daneya Esgar is giving another try at a bill that would allow local government workers to unionize and bargain collectively.  A similar bill last year was never introduced after numerous employers potentially affected by it objected, but the idea to use public money to pay off – or create – a client group never really dies.

The proposed bill is planned as an extension of House Bill 20-1153, the “Colorado Partnership For Quality Jobs And Service Act,” which formally unionizes all state government workers under one umbrella and requires the executive branch to negotiate so-called “partnership agreements” with them.  That bill was the logical conclusion of a process begun in 2007 with an executive order by then-Gov. Bill Ritter, allowing but not requiring individual state agencies to form such agreements.  Coloradans were told at the time that the order did not authorize and would not lead to collective bargaining.

So much for promises.  This November, the first such agreement was reached, and it includes a doubling of vacation time and a mandatory minimum wage of $15 for all state workers.  When the Joint Budget Committee recently authorized such a provision only for direct care workers, the cost over the next two years to taxpayers was estimated at more than a quarter of a billion dollars.

Remember, all this comes after last year’s massive state lockdowns drove the state’s unemployment rate from one of the lowest in the country to over 12 percent, destroying thousands of small businesses in the process. That year, even as businesses were forced by the state to borrow from the federal government to meet emergency unemployment claims, state workers could be assured of losing no more than four days’ pay, most of them losing only one or two.

A public-sector union feast

Esgar’s bill would extend this feast down to all government employees, including city and county governments, special taxing districts, business improvement districts, and state colleges and universities. It would also extend unionization to heretofore union-free charter schools, potentially imperiling their biggest advantage – the ability to innovate.  Rather than local governments being allowed to implement such negotiations, by framing the issue as one of employee rights, they would be required to do so on the demand of the employees.

Moreover, the negotiations could be held in secret, and any arbitration process would be exempt from the public scrutiny afforded by the Colorado Open Records Act.  What records fall under that umbrella are unclear, but it’s inevitable that governments and unions will team up to shield as much as possible from the prying eyes of the citizens.  This directly contravenes the spirit of Proposition 104, passed in 2014 with 70% of the vote, which requires open negotiations between school boards and their unions.

Bills of this kind are always framed as making it possible for the state to compete in the job market and provide better services, but that reasoning is entirely disingenuous.  Nothing keeps the executive from requesting more money for salaries and benefits or from offering better working conditions, or the legislature from approving such requests and seeing how workers respond.  Nearly 95% of the private sector work force operates that way.  Instead, during downturns, as tax revenues miss expectations, services to the public are cut, because those aren’t covered by a bargaining contract.

In one sense, the term “Partnership Agreement” is grimly accurate.  It’s a partnership between public sector unions and the politicians that they help elect, allowing the unions to sit on both sides of the negotiating table.  A 2008 Colorado Supreme Court decision made coordination between campaigns and unions exceedingly difficult to prove, as detailed in a 2016 Independence Institute report.  Those campaigns are almost entirely Democratic or liberal.  Rep. Esgar and her prospective co-sponsors know this.

New taxpayer burdens

All of this has a direct effect on the public whose interests are neglected.  States with strong public unions have higher tax burdens and are more heavily indebted than those with fewer unionized government employees.  Data drawn from left-leaning Economic Policy Institute, Truth In Accounting, the US Census, and the Tax Foundation, show a clear relationship.

While not all heavily unionized states have large unfunded pension obligations, those that do are all heavily-unionized.  Colorado WINS, the state employees’ union, has already begun complaining that the combination of cost of living allowance (COLA) reductions and inflation is unfair to retirees and violates the idea of “shared sacrifice,” as though inflation weren’t also clobbering the working households who earn the money to pay those pensions.  Look for them to try to and shift more of the burden to the taxpaying public.

Eventually this catches up with them.  States with higher government unionization are increasingly losing population – and tax base – to those with a less-unionized public sector.  In 2019 alone, Illinois, New York, and New Jersey each lost nearly 1% of their populations to net out-migration to other states.  Their residents are fleeing to states with fewer unionized public sector workers.

Colorado might be able to finesse it for a while because people still want to move here.  But the combination of a restricted housing market and a higher tax burden will eventually not only make people think twice about coming here, it will start to drive people away, making it even harder to meet these obligations.  And in the short-term, people who are leaving Colorado’s high-tax cities for the suburbs will find the plague following them.

The bitter irony is that even as long-blue states such as California, Illinois, and those in the northeast are suffering the consequences of policies such as this, Colorado’s Democrats are perfectly willing to visit them on this state.

Joshua Sharf is a senior fellow in fiscal policy at the Independence Institute, a free market think tank in Denver.


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