April 2003 News

FROM THE PRESIDENT

We had another successful Visit the Hill Day. Congratulations to Nichole Lysne,
Wisconsin Rapids Section President, and the section for organizing and participating
with the largest turn out. The Wisconsin Rapids section had more than thirty people
attend! Great participation! We will continue to build on the successes of our past
VHD activities as we plan future days at the Hill. If you haven't attended a VHD
consider doing so in the future.

I want to also thank all members who attended - the environment we live in has
become very political, so we have to become more political. If you were unable to
attend VHD, consider attending one of the Legislative Hearings that will be held around
the state. See your section president for VHD talking points and a schedule of hearing
dates.

We were not able to meet with the Governor's office on VHD, however we were able to
meet with them on March 28th. The meeting went well - it lasted for 1.5 hours. We
discussed the current contract situation, privatization, cost saving measures, and the
2003-05 bargaining. We understand that health care costs will be an issue - we will
be ready to bargain about health care costs. Benefits are part of our compensation
package and we will look at our whole package and make compari~ons with the private
sector. It wouldn't be fair to look only at insurance costs and not consider pay issues
as well - we will be looking at both.

The next few years will bring budget challenges for us all in State service - remember
to continue to be professionally and technically the best at your jobs - that's how we
can best serve ourselves and the taxpayers! I ask everyone to eliminate "ngineering"
from their jobs and do things right !! (see last months newsletter for the definition of
"ngineering").

The Association is YOU I Continue to support your local leadership and participate!
Respectfully,
Timothy R. Hanley
SEA President

Legislative Report April 2003
Larry Legro 2nd VP
Here is a story that could occur due to employer (such as the state of WI) having a
significant budgetary deficit: An employer offered $50 for each money-
saving idea submitted by its employees. First prize went to the employee who suggested
the award be cut to $25.

Well the 5th Annual Visit the Hill Day (VHD) is over. Does the word "contract"
ring a bell?...( or how about the name Quasimoto?, maybe this is the only name
which rings a bell huh?), anyway, I really expected a bigger showing than we had
(about 90 members) but this number appears to be the norm for this event. I expect any of
you that did not attend for whatever reason, to start writing letters to the newspaper,
letters to your legislators, doing what ever it takes to get our messages out. It could be
your 2 year late contract, the state of the state, the partisan B.S. which Occurs almost
daily during these times, at our Capitol.

One legislator (whom I shall not name) stated to me at VHD, that they should put a
big red light on top of the Capitol Building (meaning it is just one big whore house in so
many ways and to be honest, I agreed with him). I told many legislators or their staff at
VHD day that I used to respect our Capitol building, for what it stands for, and for
what occurs there, but now I think of it as just one big High School with is cliques and
jock/nerd mentality. A couple of legislators were really candid with me, more so than I'd
ever suspected they would or could be.

So enough soapbox. .. Get involved, stay involved. Help a legislator you agree with,
send them some money, work on their future campaign, get more cozy with them so they
will support you too. To hell with the bad ones. I am guessing they already know who
they are. Let them know it, but be professional.
We will be meeting with the Governor's policy staff on Friday, March 28,2003 prior
to our next Board meeting, Sat. 3/29/03. I am writing a letter to all the legislators I
connected with to Thank them and their staff. I might also send a couple of them a
contribution towards their current or future "war chests ". The more we connect with
them the better our organization will be known about, and the more our message
regarding employment gets imprinted with them.

It is not a good time to retire, giving the state of the stock market, your retirement account
investments, and the state of the state and state of the union.

Health insurance might be a big ticket issue during the next round of contract
negotiations. I came across an article from 6/26/2002., (only about 10 mos. ago) stating
that 18 of the state HMO's made a profit in the first quarter of 2002 of $20.2 million.
HMO's make up about 53% of the commercial health insurance market in
Wisconsin., which excludes Medicare/Medicaid participants and people
covered under employer-sponsored self insure plans.
Our 2001-2003 contracts are still on hold, no word on what, when, where, or how they
will develop into anything of significance- for us. Meanwhile, the U.S. President is
being occupied with his conflict with the Republican Guard, in Iraq, and we, the
unions are preoccupied with the Republican Gard in the State Capitol. Enough said on
that subject. So, did the winner of the award mentioned in the opening of this article get
$25 or $50?

WI COALITION OF ANNUITANTS (WCOA) MEETINGS - FEBRUARY 19 & MARCH 19, 2003
- --, --~~
We established the ETF Board Study Committee to review the representation
on the ETF Board. Ed Kehl, the Chair, named the following to the committee:

Joe Corry Jim Gruentzeli Art Palleoni Mel Sensenbrenner & Truman Graf.
We discussed how the ETF rules for election of Board members do not
permit any write-in candidates. This rule is a form of discrimination against
the participants.

Bill Ford, from the Legislative Council, discussed the Governor's Budget
and items in the Budget affecting ETF and WRS. All Section Presidents have
copies of these items in the Governor's Budget Summary.

At the March WCOA meeting, we had Sandy Drew from SWIB present the
performance data for the end of February 2003.

Fixed Fund -2.0% Benchmark -2.1%
Variable Fund -4.5% Benchmark -4.6%

Sandy also reported on the limited investment of the $100 million authori-
zation by the Legislature to invest in Venture Capital. To date, SWIB has
only found $18 million that meets their criteria to invest in.

The Legislature's thoughts were that SWIB could dump a significant amount
of money to business in Wisconsin, but they can't find that many profitable
companies.

The SWIB bonuses are paid on a formula of individual performance for
1 year, 3 years and 5 years plus consideration for their portfolio's contribu-
tion to the total fund. Some people are questioning if the bonuses are just
plus, or if they should be both plus and minus.

Bill Ford presented a copy of the Joint Survey Committee on Retirement
Systems (JSCORS) membership and Senate Bill 44 items involving the retirement
system. I have provided copies to all Section Presidents.

This information I'm providing to you and the Section Presidents is very
important because every individual has the ability to communicate their position
to the JSCORS at each hearing by letter directly to that committee. The money
the State contributed to the retirement system is your money, and by the time
you retire, it amounts to hundreds of thousands and provides for your future.

We also discussed the Retirement Research Committee, which has not functioned
since September 26, 1996 by Republican design. The study of Act 11, before passage,
was conducted by the legislative leadership and was a short term 2 year period.
Now look at where we are with possible minus dividends just 4 years after the
implementation of Act 11.

WREA has a committee reviewing the possibilities of including the retirement
research function within the JSCORS and adding an annuitant representative to
that legislative committee.

ETF's estimate of the WRS funding level has been reduced by 9% by Act 11,
which leaves us at 84% funding at the end of 2002.
The next WCOA meeting will be held on April 16, 2003.

Melvin B. Sensenbrenner,
SEA Retirement & Health
Insurance Representative

Please note: The WCOA 2003 Conference Program and registration form in
this Newsletter, which anyone can attend, to be held on May 6, 2003.
 

SWIB MEETING - MARCH 5, 2003
The end of February 2003 performance for SWIB:

Fixed Fund -2.0%; Benchmark-2.l%
Variable Fund -4.5%; Benchmark~.6%

Fixed income, real estate and alternative assets are at a +2.4%.
Good news: The SWIB budget was not tinkered with by the Governor
and DOA.

Guest speaker for SWIB was Dr. A. Gary Shilling, co-investment
advisors and economic consultants.

Dr. Shilling presented his economic outlook to SWIB on deflation
and its investment implications.

The next SWIB meeting will be held on April 2, 2003.

Melvin B. Sensenbrenner,
SEA Retirement & Health
Insurance Representative

Bargaining
200 1-03 Contract

Section Presidents reported overwhelming support of not
voluntarily returning to the bargaining table. Willie Haus
discussed the entire contract approval process and
summarized how we've gotten to this point and gave an
opinion as to what might happen. It was also noted the
bargaining team is only as powerful as the people they
represent (member participation is extremely important). It
was noted that Fact Finding exists in Wisconsin, it is
voluntary, and can be very time consuming, but the state
has never agreed to it. Some legislators are suggesting the
State adopt arbitration language, and Willie discussed how
arbitration works, recent changes in the law, and
appropriateness to our situation. Tim reviewed a handout
with possible ideas for what can be done and touched upon
recent. discussions with other bargaining unit leaders.
Willie agreed to help put together a list of things members
can do to strengthen our position and offered to attend local
section meetings to discuss the same.

2003-05 Contract:
Sharon Bremser handed out a summary of demands based
upon the recent DFTF meeting in January and reviewed it.
All Board members are to review this information and
priorities will be discussed at the next Board Meeting.
George Mickelson discussed several issues that will relate
to compensation. It was also noted the state has 3.3%
fewer FTE's compared to 2 years ago. Also the Legislative
schedule for completing work on the proposed budget is
August 2003.

Legislative Report
By Larry Legro

Mike Schoenfie1d reported on information obtained
through the State Budget Office, state employees wages,
salaries and benefits account for.18.01% of the FY 02 and
18.75% of the FY03 budgets respectively. He noted this
is normally the highest cost for states and is significantly
higher in other states. Larry will be sending a letter to all
members concerning VHD and another letter to all
legislators notifying them of the event. Mike is still trying
to arrange a meeting with the Governors' Office.
Two good websites to keep informed on political issues
are: www.wispolitics.com and www.thewheelerreport.com.

Health and Retirement Report
By Mel Sensenbrenner

Mel submitted a bill for SEA's yearly dues for the
Wisconsin Coalition of Annuitants. Leroy Stublaski
motioned to pay the $50 dues, seconded by Mohamamed
Hayek, motion carried. The Group Insurance Board met
on 2/18(03 and proposed change guide lilies were
discussed. A short summary of the Governors' budget
initiatives was presented and included; Sick Leave
Conversion; 30-day break-in-service; State Health
Insurance Costs (Subject to Bargaining), Replacement of
105% with 80%). See your Section President for more
info.
 

ETF GROUP INSURANCE BOARD MEETING - FEBRUARY 18, 2003
--- -
Bill Kox reviewed the Proposed Changes to the Guidelines for Uniform
Benefits for the HMO contracts for the corning year (2004) and the time-
line for their approval. Everyone should review these changes because
they are significant, and every SEA Section President and State Officer
has a copy of this ETF memo dated January 27, 2003.

Bill Kox also provided an update on the recommendations from the Health
Insurance Study Group to the Group Insurance Board. The study group recom-
mendations are now included in Governor Doyle's Budget Proposal. Review
letters from SEA Section Presidents to the Legislative Finance Committee
and the study group update provided to all SEA Section Presidents dated
February 12, 2003 by Bill Kox (4 pages).

Everyone must get prepared because it will require bargaining to be
implemented by January 1, 2004.

Bill Kox provided the Study Group Recommendations dated November 13, 2002
to the SEA Board on March 29, 2003 and answered any questions the SEA Board
had at the time.

t believe everyone should review newspaper articles provided to all
SEA Board members on March 29, 2003. In the health care pack, note the
article "universal Health Bill Introduced" by Rep. Mark Miller dated
March 10, 2003, and "State Docs Back Universal Care" dated March 19, 2003.
There appears to be a move to change the health care system here in the state
of Wisconsin, if not totally, at least the state employees system is being
converted to a 3 tiered system with a revised premium formula, with state
employees paying a higher percentage of the cost.

You must also remember that when you retire from state service, you pay
the full premium for your health insurance! Don't forget to bank your sick
leave.

Melvin B. Sensenbrenner,
SEA Retirement & Health
Insurance Representative

A STATE ENGINEERING ASSOCIATION - APRIL 2003 PAGE 9
ETF BOARD MEETING - MARCH 13 & 14, 2003

The ETF budget for new permanent positions was cut by the Governor's
Budget by DOA. ETF will also lose the project positions they have had
for implementation of Act 11, which end this coming July 1, 2003. This
will mean less people to handle phone calls and calculations of estimated
retirement annuities.

ETF is leasing space for the insurance division, and the planning for
a new building submitted to the Building Commission is on hold because of
the State's poor financial condition.

The ETF Board also had an educational briefing on their fiduciary
responsibilities to all participants and treating them fairly by the
votes they cast as a Board member.

Norm Jones of Gabriel, Roeder, Smith & Co. gave the actuaries report
on The WRS 20th Annual Actuarial Valuations which were used by the ETF Board
to approve the annual adjustments effective May I, 2003--Fixed 0%; Varia-
ble -27%. The Fixed Fund is still affected by Act 11 distribution of
1.98 billion, which gives a 0% dividend to annuitants and a 5% credit for
active emplqyees.

They are projecting a negative dividend for next year unless the SWIB
investments exceed 9%.

The Board voted to delay the implementation of the April 1, 2003 dividend
date because of the -27% variable dividend take away.

The ETF Board also received a performance report from SWIB by Ken Johnson
and Jean Ledford, Chief Investment Officer.

The next ETF Board Meeting is scheduled for June 19 & 20, 2003.

Melvin B. Sensenbrenner,
SEA Retirement & Health
Insurance Representative