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Analysis: Cuomo Expected To Threaten Layoffs

ALBANY, N.Y. (AP) -- Gov. Andrew Cuomo's firm yet vague threat to lay off thousands of state workers as part of the budget he'll present Tuesday has employees and their families shaking.

The fear is real. But in Albany, where the fog of politics makes it difficult to even figure out even how many state employees there are, reality is harder to figure out.

Cuomo's budget will likely include more threats of massive cuts in the work force that he estimates totals about 190,000. The state comptroller's office says the total is more than 266,000, based on payroll checks. On average, each of the workers costs the state about $98,500 a year in wages and benefits, creating a ripe target to help address a $10 billion deficit.

But some Democratic lawmakers and financial analysts who have done a lot of tours in Albany privately say that history, economic trends and politics could mean far fewer, if any, layoffs by the time the 2011-12 budget is finalized in coming months.

That's hard to believe after the horror stories relayed by legislators with an apparent wink and nod -- but no confirmation -- from Cuomo in closed-door meetings this month. Lawmakers emerged saying there could be as many as 15,000 jobs cut across every part of the state.

On Tuesday, Cuomo will present a budget proposal to the Legislature that his aides have breathlessly whispered will have all the cheer of a "Saw" movie.

How much of that presentation will be real, and how much positioning by Cuomo the labor negotiator, will determine whether there is real blood on the podium, or stage blood.

The big difference between the repeated layoff threats by former Gov. David Paterson -- about 900 workers eventually were let go on Dec. 31 -- and Cuomo is that the public unions' contracts expire in March. The unions had refused to reopen their collective bargaining agreements for Paterson to address growing deficits.

But unions now are making it clear they want to deal.

Cuomo insists he's got "a target," and he can get to that target with or without the unions' cooperation. But the target isn't a number of layoffs. It's a dollar figure that Cuomo says is unsustainable.

That target can, potentially, be hit without a single layoff, especially if the pain is spread beyond the 2011-12 fiscal year, as Assembly Democrats close to the unions are now suggesting.

The 2010 state Workforce Management Report by the Civil Service Department shows that the state could shed as many as 10,700 jobs without one layoff. That's one year's attrition.

The report shows there's room to eliminate far more jobs, as was done in 2002-03, with a modest early retirement incentive. The report also states that 32,000 employees can be expected to retire sometime by the end of 2015 and that by then, 70,335 state employees will be 55 years or older, ripe for early retirement deals.

Then there is the argument over whether layoffs are wise.

The state Labor Department's latest unemployment report shows that from December 2009 to December 2010, total private sector employment increased 1 percent. But that glimmer of recovery would be greater if the Paterson administration as well as local governments weren't forced to cut government jobs by 2.3 percent at the same time.

"It doesn't really help the economy to reduce the size of government," said Frank Mauro of the labor-backed Fiscal Policy Institute. "Laying off government workers if there are other choices available is going to hurt the economy more."

State layoffs mean less income tax revenue, reduced local spending by families to fuel sales taxes and other taxes and fees, further cutting government revenues.

"The danger in government layoffs coming at the point in the recession, when the private sector is trying to make traction, trying to balance the budget through government layoffs is going to have effects I don't think this or other governments want," Mauro said.

In the 1990s, Republican Gov. George Pataki and former Democratic Gov. Mario Cuomo each leveraged threats of massive layoffs to extract labor concessions, ultimately laying off a fraction of the number projected.

For all the talk of a shocking budget proposal Tuesday, there's enough evidence that Gov. Mario Cuomo's son is following the same strategy. Securing cuts to avoid layoffs would even help the state's bottom line faster: Because of months of required notices, vacation time and other factors, the state would likely only see half the savings of any cuts in the 2011-12 fiscal year.

So Tuesday's first act in the governor's budget won't be as important as the second act 30 days later. That's Cuomo's last chance to amend his budget, one he could end up having to impose if difficult budget negotiations with the Legislature go beyond the April 1 start of the fiscal year.

Cuomo's 30-day amendments will also come after he gets reports from his task forces seeking billions of dollars in cuts in Medicaid and through agency consolidation. It will also be after union leaders make their first pitch to avoid layoffs.

"They haven't tipped their hand," said Stephen A. Madarasz, spokesman for the Civil Service Employees Association union. "It's hard to see if this is just part of a bargaining stance, or something else."

"When you get to layoffs, its the signal of a failed administration," he said. "If layoffs are the first thing you're doing, you're missing all the options that come before it."

(Copyright 2011 by The Associated Press.  All Rights Reserved.)

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