Local governments across US cutting hours of part-time employees over Obamacare cost

While the debate goes on over Obamacare — Gov. Beshear says it will create 17,000 new jobs in Kentucky, and Sen. McConnell saying it will destroy the 40-hour work week — the Washington Post reported today that many local governments across the nation, facing hundreds of thousands of dollars in new health-care costs, are cutting the number of hours their part-time employees work. 

Many cities and counties are cutting employee hours 16 months ahead of the effective date of the provision in Obamacare that requires them to offer health-care coverage to all employees who work at least 30 hours a week. 
 

Some local officers are making the cuts early either because of labor contracts that must be negotiated in advance, or because employees who work at least 30 hours in the month leading up the January 2015 implementation date (of the mandatory coverage) would need to be included.
 

The Post reported the following examples: 
 

• Middletown Township, N.J., said it would reduce the hours of 25 part-time workers to avoid up to $775,000 in increased annual health-care costs.

• Bee County, Tex., said it would limit its part-time workers to 24 hours per weeks, when it’s new fiscal year starts Oct. 1.

• Brevard County, Fla., estimates the new mandate would cost the county $10,000 a year per part-time employee; the county’s libraries have already cut hours for 37 employees.

• Lynchburg, Va., has cut hours for 35 to 40 part-time workers.

• Chesterfield County, Va. (south of Richmond) said it likely would cut the hours of “several hundred” employees.

• Chippewa County, Wisc., will drop 15 part-time workers to avoid up to $163,000 in annual health care costs.
 

A senior fellow of economic studies at the liberal Brookings Institution,* a Washington, D.C.-based think tank, told the Post that he doesn’t think Obamacare will be a “big direct-cost burden” to cities and counties. 
 

* The Brookings Institution describes itself as a “independent and nonpartisan,” but a 2011 study examining the political donations of think tank employees, showed that 97 percent of Brookings’ employees’ political donations went to Democrats.

Some political polls are designed to con us

Reprinted from Kentucky Roll Call newsletter, Aug. 15, 2013.

In the world of commerce, the Latin term caveat emptor means that a person who buys something is responsible for making sure that it is in good condition, works properly, etc. In English it’s called “buyer beware,” which applies equally to politics, especially advertising and polling. Consider the following. 

A July 23-24 poll by Republican pollster Wenzel Strategies put McConnell ahead of Alison Lundergan Grimes, 48-40; a week later, the nonpartisan Cook Political Report lowered its rating of a McConnell-Grimes matchup from “lean Republican” to “toss up,” and tweeted an explanation: “given that two polls show the race within the MOE and with Grimes ahead of McConnell in both, it moves to the Toss Up column.” 

What the tweet failed to mention is that one of the two polls was conducted by Grimes’ own pollster, and the other was conducted by Public Policy Polling, a Democratic polling firm, for two Democratic groups opposing McConnell. 

It may surprise you that the respected Cook Report lowered its rating based on partisan polling, which by definition is done to con the public — by Ds and Rs — which the public accepts, when it’s done with finesse. 

Who to trust? The equally respected, nonpartisan Rothenberg Political Report said, following Cook’s change, that it’s keeping the McConnell-Grimes race, “Republican favored” — two notches from “toss up.”

Julian Carroll helped launch McConnell’s career

Reprinted from Kentucky Roll Call newsletter, Aug. 15, 2013.

From 1974 to 1980, Roy Stevens served as a chief aide to Gov. Julian Carroll and to Gov. John Y. Brown Jr. In a memoir, Grass Roots, released this summer, Stevens recounts how Carroll subtly helped launch Mitch McConnell’s political career. It happened as follows: In the 1975 governor’s race, Gov. Carroll was running for a full term, after ascending to the office from lieutenant governor when Gov. Wendell Ford resigned to go to the U.S. Senate.  Jefferson County Judge (judge-executive now) Todd Hollenbach Sr., on the basis of his strength in the state’s largest county, filed to run in the Democratic primary against Carroll. Hollenbach carried Jefferson County by more than 5,000 votes, but Carroll handily won the race.

Stevens writes, “Hollenbach did himself no favors by running for governor in 1975. In 1977, Julian had an opportunity to send that message and underscore that point when Hollenbach was running for re-election as Jefferson County Judge. Hollenbach’s 1977 opponent was a lesser known Republican lawyer named Mitch McConnell. Julian, the Governor and titular head of the Kentucky Democratic Party, was asked about McConnell’s candidacy. Julian’s response was to publicly compliment McConnell, in effect, telling Democratic loyalists in Jefferson County they should feel comfortable supporting a Republican in that particular race. After holding a 44 point lead in early polling, Hollenbach was defeated by McConnell. ... The election launched a winning streak by McConnell, who was first elected to the U.S. Senate in 1984 and is now the Senate Republican Floor Leader.”

[Editor's note: A copy of Roy's memoir, Grass Roots, is available, as the limited the supply lasts, to individuals who donate $20 or more to the Princeton Animal League (PAL), 1300 South Jefferson, Princeton, KY 42445. He may be reached via e-mail at rstevens40@att.net.]

Private-sector workers get government pensions

The following is an editorial from The Kentucky Gazette, Aug. 14, 2013. Reprinted with permission.

It might surprise you to know that the employees of 1,169 entities participate in Kentucky’s County Employees Retirement System. That came to 47,452 retirees and 94,636 employees as of June 2012. Could be more now; could be less.

   Most of these employees are government employees – they work for the water districts and counties, school districts and cities – and they have earned a government pension.

   But some of these people are employees of “instrumentalities” of government; that is, they aren’t true government employees. For this reason, they should not be allowed in CERS.

   We’re certainly not suggesting that the employees of instrumentalities don’t deserve pensions. Rather, we’re suggesting that the pensions shouldn’t be provided at taxpayer expense.

   As we know, most of the revenue in the pension funds is derived from investments (65 percent to 70 percent), and the employees pay into the fund as well (5 percent or 6 percent, depending on their hire date). But, according to Reuters, roughly 20 percent of Kentucky’s pension fund revenue comes from the taxpayer. Depending on the national economic climate and returns on investment, this could be more, could be less. Either way, citizens write the checks to cover the difference.

   CERS, which is one of the three systems under the umbrella Kentucky Retirement Systems had, as of June 2012, an unfunded liability of $3.59 billion in its pension plan for employees in non-hazardous occupations, and a $1.26 billion liability in its plan for employees in hazardous jobs, a total of about $4.85 billion. These obligations mean the plans do not have enough money to fully cover retirees, who’ve earned full benefits, and current employees, who’ve earned partial benefits. The non-hazardous plan had 60.7 percent and the hazardous plan had 58.1 percent of the money the plans need to pay pension benefits, according to the 2012 KRS Comprehensive Annual Financial Report, the most recent available.

   Twenty percent of the $4.85 billion comes to $970 million that individuals, business owners and consumers must redirect from other spending preferences to pay for pensions, and part of that covers people who aren’t government employees.

   Apparently, a number of these entities work under contract with the local governments or exist to provide services to government entities. Take the Kentucky League of Cities, for example, and the Kentucky Association of Counties. It’s been said here before that these two entities, which both own for-profit insurance companies that make millions of dollars a year, should not be part of the public pension system.

 Let’s add to the list the Kentucky Magistrates and Commissioners Association, the Kentucky Judge-Executive Association, the Riverpark Center, and Housing Oriented Ministries, to pick out a few.

    As near as we can tell, Hous-ing Oriented Ministries, a non-profit corporation based in Whitesburg, is a program of the United Church of Christ. Also a non-profit corporation, the Riverpark Center is an entertainment venue that hosts Broadway shows, among other programs. And the magistrates and judge-executive associations should be dropped from CERS because they simply are not government entities.

   To be fair to current employees, those in the system should be able to continue and accept the pension promise that’s been made to them. Going forward, though, lawmakers need to amend KRS 78.510 (3), which gives broad authority to the Kentucky Retirement Systems board to determine which entities can participate in CERS: 

   “(I)f the (retirement systems) board is willing to accept the agency, organization, or corporation, the board being hereby granted the authority to determine the eligibility of the agency to participate.”

   After Kentucky’s General Assembly sets CERS right, then members can start on the Kentucky Employees Retirement System, which has the same problem. KERS participants include Commonwealth Credit Union, the Kentucky Bar Association, Nursing Home Ombudsman Agency of the Bluegrass Inc., Judi’s Place for Kids … You get the picture.

Laura Cullen Glasscock, editor and publisher