Now that Wisconsin’s public-employee union reform law has gone into effect, how has it impacted the state’s taxpayers? Two cities in the Badger State took two different approaches to it, and came up with two very different outcomes. First, let’s look at Oshkosh, whose school district waited until after the passage of the PEU reforms to negotiate health-care coverage, which the city had contracted with the Wisconsin Education Association Trust, part of the teachers union and a major source of income for the PEUs. Now that the unions can no longer negotiate on benefits, Oshkosh has the latitude to find the best deal for coverage — and that will save taxpayers a ton of money (via Tim R):
The district hopes to drive down costs by taking advantage of newfound competition between insurance companies hungry to break into the education market, which has so far been dominated by WEA Trust, a nonprofit provider created by the state teachers’ union.
Many districts, including Oshkosh, have previously tried to switch providers for lower rates, but local unions staunchly refused the offers. They argued for-profit companies would make up the difference with larger rate hikes in future years.
But unions no longer have a say in the matter since the state Legislature approved a law preventing most public sector unions’ from bargaining over anything but wages.
The district could realize millions of dollars in immediate savings by seeking a new provider. Appleton schools stuck with WEA Trust but saved $3.1 million by stirring up competition. The Kimberly school district dropped WEA Trust and saved $821,000.
I wrote about the WEA Trust racket in February. Unions insisted on forcing school districts and cities to use the WEA Trust, which charged premiums far above the market, costing taxpayers tens of millions of dollars every year — perhaps hundreds of millions when spread across the state. That allows these counties, cities, and school districts to spend the money on actual services to students and taxpayers, or perhaps just save people some money on their tax bill so that they can spend it themselves.
On the other hand, Wisconsin’s capital of Madison rushed to conclude a deal with the unions before the PEU reforms took place. Want to guess how that’s working out in the city that unions control?
Former Madison Mayor Dave Cieslewicz extended several city labor contracts in February.
Then he signed and extended contracts again in March — just before his April re-election bid.
The unions, which feared Republican Gov. Scott Walker’s looming changes to collective bargaining, were happy with the deals. And AFSCME endorsed Cieslewicz’s campaign.
But now the results are painfully clear for city residents.
City agencies just proposed laying off 38 cops and 27 firefighters while reducing salt and sand on covered streets during winter. The agencies also proposed eliminating the school crossing guard program and reducing lifeguards at beaches while closing some city skating rinks.
Cieslewicz’s rush to extend the contracts had no basis other than shameless pandering to the unions. It violated the fiduciary responsibility of the mayor to protect the interests of the taxpayers over that of its contractors. What manager would rush to negotiate union contracts under the worst possible negotiating environment when it was obvious that the environment would shortly improve — even though it still allowed Cieslewicz to cut any deal he wanted later? Answer: The kind of manager who sells out his constituents in favor of his political allies.
The new mayor now has to make very unpopular cuts in first responders and services, and raise property taxes as well, by 3%. The Wisconsin State Journal’s editorial board is furious:
Cieslewicz and other city leaders should have seen this coming. And they should have waited to finalize any new city contracts with labor unions until after state changes to collective bargaining kicked in.
That would have given city leaders more flexibility to save on employee wages and benefits — in the same way that school districts all around the state have done — rather than laying off workers and cutting services for potentially years to come.
Had the PEU reforms not passed at all, no city, county, or school district would have had that flexibility. Taxpayers across the state would still be getting the shaft from the WEA Trust and the unions, and having to lay off first responders and cut services instead. Looks like Scott Walker knew what he was doing after all, and they’re discovering that even in Madison.
Update: They’re keepin’ it classy in Wisconsin:
Custodial staff at Messmer Preparatory school were replacing locks Friday morning after the previous ones had been filled with metal and glue overnight, said the school’s Development Director Jeffrey Robb.
“We’re very disappointed,” he said.
The vandalism came hours before Gov. Scott Walker was scheduled to visit the school to read to second- and third-graders. Walker plans to read, “Oh! The Places You’ll Go,” by Dr. Seuss.
Now who might have done that? Well, a representative of the Milwaukee branch of the Students for a Democratic Society tells the Journal-Sentinel that “We’re not going to let him go anywhere, especially in our community, without him being protested,” although he disavowed the vandalism as ineffective to the cause. Whoever did it has no problem costing schools and school districts more money in order to keep their stranglehold on power in public policy.