How public unions can help avert furloughs and layoffs for Chicago and Illinois government workers

The budget gap for the state of Illinois is $5 billion.

That’s how much the state might have to borrow to survive the fiscal year that begins July 1.

The budget gap for the city of Chicago is at least $700 million.

That’s the city’s projected revenue shortfall for the remainder of 2020, due to the economic impact of COVID-19.

Both the state and the city continue to hope the federal government will ride to the rescue later this summer with another stimulus package. But nobody should count on that, and it likely would be a partial bailout at best.

The grim truth is that the finances of Illinois and Chicago were structurally unsound long before the coronavirus pandemic hit, and major layoffs and furloughs are virtually a sure thing now — unless difficult steps are taken immediately.

Almost certainly, the state and city will have to refinance their pension debt to attempt to save hundreds of millions of dollars. And almost certainly, there will be new and higher taxes.

What is less certain — but should not be — is that union contracts for public employees will have to be reopened to reduce costs. Every possible solution to the current crisis must be on the table, including a reconsideration of a host of contract provisions.

Union should take the lead

It is, as we see it, wholly in the interest of the unions to join in this effort. The finances of the state and city were unsustainable even before the pandemic. Now they are close to collapsing, threatening the very existence of those good union jobs and pensions.

By joining in this effort, the unions would be in a position to shape negotiations in ways that work best for their members. They might reasonably insist, for example, that a big portion of any savings from contract changes be put toward paying down pension obligations.

And while we’ve heard the argument that reworking union contracts wouldn’t make a dent in the financial problems of the state and the city, we’re not so sure. Let’s see how scalpel-like revisions in dozens of contracts add up.

The city of Chicago has collective bargaining agreements with more than 40 union units. The state has agreements with more than 30 union units. Cook County, for that matter, has agreements with dozens and dozens more.

In any event, we believe Mayor Lori Lightfoot and Gov. J.B. Pritzker, as well as Cook County Board President Toni Preckwinkle and others, have the legal authority to compel the renegotiation of contract language. Many of the contracts include a “force majeure” clause that allows for the agreement to be reopened in the event an extraordinary fiscal emergency that is beyond the control of both sides.

If this is not an extraordinary fiscal emergency, what would be?

First steps

To minimize the threat of layoffs and furloughs, Pritzker and Lightfoot should take one step that is obvious — stop hiring and allow natural attrition to reduce the workforce over a few years — and a second step that is less obvious — offer early retirement deals. Shuffle the remaining workers around to do the most necessary jobs.

Beyond that, we can think of dozens of contract changes that would cut costs without compromising the quality of services. Among them are:

• End the “traditional work” restrictions in city union contracts that reserve certain tasks for certain union members. The Sun-Times called attention to this rule a decade ago when we wrote about how only a Teamster driver can drive a city work crew to a work site. Then the driver is free to stare out his truck’s window all day — his job duties carefully limited by his union contract — while the work crew does the job. Ten years ago, city Inspector General Joe Ferguson estimated the city was blowing $20 million a year on these unnecessary drivers — $23.6 million in today’s money.
• Reduce the number of city employees kept on the payroll just for emergencies, such as some electricians. Day in and out, there’s not enough work for them to do. The city should instead bring in extra workers as sporadically needed, hiring from unionized private companies.
• Reduce staffing on fire engines and trucks, going from five-man crews to four-man crews. In today’s dollars, that would save the city about $63 million a year.
• Reduce the number of laborers on a garbage truck from 2 to 1, which is the norm across the country. This would save about $12 million.
• Reducing the number of paid city holidays from 13 to 10, like in the rest of the world, saving $6 million.
• In jobs that do not require their specialized training, replace dozens of uniformed police officers and firefighters with civilians, saving $10 million. Four years ago, and perhaps still today, uniformed firefighters were filing photos and delivering the office mail.
• Last, but not least, both the city and state should considering foregoing all employee pay raises for a year.

Don’t set us against each other

Will all of this, plus other contract revisions, result in a financial savings big enough to pull Chicago and Illinois out of crisis?

Probably not.

Further unpopular measures, such as expanding the state’s sales tax to include services, could well be necessary.

But if unionized public employees, the biggest cost of government, refuse to budge on even their contract provisions, they risking feeding a bad dynamic — union versus non-union.

Why would everybody else agree to pick up the tab?

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