March, 2004
Wealth, not citizens, now controls our government
From The President
We made a little progress at our last bargaining session on February 27,
2004. We raised
concerns about the changes in the health care system the State is proposing to
us and
presented a language counter on layoff. Because of the concerns we raised OSER
has
coordinated a meeting with the staff at ETF. It will be a three party meeting
with OSER, ETF,
and SEA attending and is scheduled for March 29. See your section president for
more
detailed information.
Visit the Hill day is scheduled for April 28, 2004. Plan to attend. I know you
all are frustrated at
the direction state government is heading. Rumblings are coming from agencies as
they are
beginning to work on their next budgets for FY06-07. Agencies are being directed
to consider
cutting another ten percent in state employees. Does anyone wonder what the
Governor is
thinking? I think the Milwaukee Journal Sentinel is beginning to understand -
see the editorial
on Tuesday March 16, 2004 on page 10A. The editorial was about the DNR Air
Management
program. Bottom line is the program needs the tools and personnel to do their
jobs and protect
Wisconsin air. I wonder why the newspaper understands what is going on in state
government
but the Governor doesn't?
In the last newsletter I made some statements about what we see happening in
state
government and OSER Director Timberlake contacted me to discuss my article. She
also
encouraged me to contact the respective agencies and discuss my concerns
directly with them.
One of my biggest concerns is that frontline issues are getting lost in the
agencies and never
get to the Governor. No one is opposed to streamlining and saving state tax
dollars. But if at
the end of the day that isn't the case, then someone has to be accountable to
the taxpayers.
Here is a simple example of what I mean.
This example is from an agency for the state that deals with legal matters. The
agency used to
have a lead attorney, some assistants, and clerical support. Now in this new
environment
there is only a lead attorney. No assistants, little to no clerical help, and
increasing workloads.
The attorney commented that he has no help, he has to do his own filing, etc. Is
this
government streamlining and efficiency? Are customers getting service in a
timely manner
from this attorney? Is it good government to pay an attorney to file? Is this a
step towards
government dysfunction? Is this what the Governor thinks is good for the State
of Wisconsin?
This is happening in most state agencies to some degree or another; do we want
that to
continue?
Remember to be professionally and technically the best you can be at your jobs!
It is how you
can best serve yourself and the taxpayers of the State.
Respectfully,
Timothy R. Hanley
SEA President
The Health Insurance Mess; Political Shenanigans; State Bargains in Bad Faith
The state's new Three Tier Health Plan was hurriedly implemented without any
clear
sense as to whether it would in fact result in savings to the State, or how much
such
savings would be. It is clear that the Plan has been implemented without regard
to the
State's bargaining obligations under the law and that it results in substantial
cost shifting
to employees who may be unsuspecting victims.
By not having the contracts settled prior to implementation, the health plan
presents
problems for the agencies, who are currently fronting health insurance costs out
of their
budgets without knowing what the actual cost will be or when they will receive
monies anticipated to be paid by employees. Significant problems with the Three
Tier
System include a fundamental refusal by the State to bargain about the system
itself or
terms related to its implementation. The State unilaterally implemented the plan
effective January 1,2004. There is no guarantee that every employee will have a
Tier One price available to them going into the future. If the system works out
so that
the employees do not have a Tier One option, such affected employees could
suddenly face a dramatic increase in their contribution levels.
The drug plan (Navitus) has been changed dramatically. Based primarily, if not
entirely on cost considerations, prescription drugs can be moved along three
levels of co-
pays or be removed from coverage altogether. For Example: If you are
prescribed a Level Three drug, you not only have a $35 co-pay, but that payment
does
not count towards meeting your annual out of pocket costs. In addition, if a
drug is not
covered, your payments for such drugs also do not count to meet your
out-of-pocket
costs. In addition, if a drug is not covered, your payments for such drugs also
do not
count to meet your out-of -pocket maximums. Some employees are spending
thousands of dollars over and above what they were required to spend under the
previous plan and much of what they spend does not even count towards meeting
their
out-of-pocket maximums. While some unions have reached agreement without
understanding the risks and costs of this system poses for their members, it is
now
clear that they made a big mistake. The State wants to shift all of these costs
to the
employees and at the same time, refuses to offer a reasonable pay increase.
The State continues to use privatization as a preferred way of doing business
despite the
substantial extra costs to taxpayers. WHY? It looks like politicians have
learned from
former Governor Tommy Thompson that if they do business with private
consultants, it
may cost more, but the politicians get more in contributions from the private
consultants.
This is called PAY TO PLAY, and it's the biggest scam in town. Wisconsin has one
of
the lowest numbers of state employees compared to the population of the state.
Yet,
Governor Doyle keep~ pushing more cuts in the number of state employees. Does
this
reduce the size of government? No! The politicians, including the Governor, are
spending more money than ever and more money than they need to through
privatization. They are having the private sector doing the work, often without
competitive bidding, and for more money. For instance, private consulting
engineers
are paid 20 - 30 % more and the multi-year contracts they work under, include
4-6
percentage increases per year. State employees, doing the same work for less are
offered wage freezes and layoffs. The problem is that the State employees don't
give the Governor political contributions any where near the amount he receives
from
private consulting interests.
It is interesting that the Governor and his cabinet officers have seen fit to
attend
elaborate private consultant functions where the biggest thing the Governor has
in
common with these interests is the mutual flow of dollars at the expense of the
taxpayers. It is a disgrace. Yet the Governor has not bothered to meet with the
state employees he is accused of refusing to bargain with in good faith. We did
not get a
"NEW DAY". We got a new beneficiary of the P A Y TO PLAY system. There are cases
where a "limited term employee" who has been working for the State, is laid off
on one
day. S/he then reports the next day as the "employee" of a private consulting
firm,
sitting at the same desk, doing the same work, but now the state paying several
times
as much to the consultant for the same services. This reduces the number of
state
employees, but it increases the costs to the state. When this is pointed out to
management representatives, no explanation is given. They do not try to justify
what they
are doing. These politicians do not care about wasting tax dollars if the money
goes
to the people that pay them back with contributions.
There are price fixing scandals that cost the taxpayers millions of dollars.
When these
are uncovered, the politicians act like they are shocked and they piously
announce that
the offenders will not be able to do business with the state. Then they sit down
and
negotiate ways to let the wolves back into the hen house. These companies change
their names, do a few cosmetic things and they are back in business scamming the
state
and its taxpayers. The politicians laugh all the way to the bank. The size of
government is not determined by the number of state employees on the state's
payroll. It
is determined by the amount of money the state spends. Hiring private
consultants
does not reduce the size of state government. It does increase the amount the
state pays for
services that state employees can perform more cost effectively.
SWIB MEETING - MARCH 10, 2004
Dave Mills reported that the SWIB performance is still continuing into 2004.
Note the following numbers for January and February 2004:
YTD Jan 31; 04 Feb
29, 04 Benchmarks
Fixed Fund +1.7%
+3.1% 2.8%
Variable Fund +2.4%
+3.9% 3.5%
Fixed
$59.05 B $60.47 B
Variable
$5.83 B $5.92 B $64.88 B
$66.39 B
Total Funds Managed $71.68 Billion $72.6 Billion
Note the £ax I received from Dave Mills, SWIB Director, dated March 9, 2004 with
highlights o£ the bonus system for investment staff at SWIB. It is based on
value
added above the market benchmarks and is spread over a five year period. I have
provided all SEA Board members a copy of the above fax. The fax also provides
the
effective rates credited to active employee accounts and retiree dividends in
both
the Fixed and Variable WRS accounts.
The guest speaker for the Board was the most knowledgeable :Professor Abir
with 40 years experience observing natural gas and oil reserves and production
throughout the world.
Russia has 50% of the world reserves of natural gas, also Russia has increased
their production of oil with new pipe-lines from Russia to the U.K., Northern
Europe
and Southern Europe.
Algeria sends natural gas and oil to Southern Europe with three pipelines
under the Mediterranean Sea.
China and Japan are trying to lock up the supply of oil from Siberia with new
pipe-
lines to the South for China and East for Japan.
The U.S. has rebuilt Iraq's system to provide 2.6 or 2.7 billion barrels/day.
U.S. oil companies are building three new oil ports in the Persian Gulf area
capable
of loading three to four oil tankers per day each for a total of 12 tankers per
day.
Saudi Arabia has 260 billion barrels of the world reserves, which makes up 25%.
The oil cartel has cut production to raise the price of oil on the market
causing the increase in gasoline prices we are seeing recently.
The next SWIB meeting is scheduled for April 7, 2004.
Melvin B. Sensenbrenner,
SEA Retirement & Health
Insurance Representative
WISCONSIN COALITION OF ANNUITANTS (WCOA) MTG. - MARCH 17, 2004
Dave Stella, Deputy Director of ETF, was guest speaker with the requested
presentation of the calculated dividends from WRS for 2003 to be paid on May I,
2004.
All SEA Board members will have a copy of Dave Stella's handout, which shows the
Fixed Fund dividend calculation of 1.4% and the Variable dividend calculation
of25%.
He also updated us on legislation on retirement bills. S.B. 344 was signed by
GovemorDoyle on Monday, March 15,2004, at 3:00 p.m., which makes the above Fixed
Fund dividend of 1.4% possible.
The other bill to be aware of was A.B. 460, which requires division of deferred
compo
accounts to spouses when a divorce decree is involved, which was signed by
Governor Doyle
on Tuesday, March 16, 2004. This bill got slipped in quickly because it was not
on the
ETF Report dated February 26, 2004. Today was the first information by ETF
provided
regarding A.B. 460.
WCOA's Annual Conference is scheduled for May 11,2004 at the Ainerican Family
Insurance Headquarters Building. An agenda is included in this Newsletter with a
regis-
tration form. I will have copies for all Board members on March 27,2004.
A motion was passed on the recommendations of the RRC subcommittee of WCOA
to request information on RRC history from Bill Ford to develop a pro-active
protocol in the
JSCORS. This will insure proper protection of the WRS and its stability into the
future.
The next WCOA meeting is scheduled for April 21, 2004.
Melvin B. Sensenbrenner,
SEA Retirement & Health Insurance Rep.
WISCONSIN COALITION OF ANNUITANTS (WCOA) MTG. - FEBRUARY 18, 2004
Bil1'lJ'ord reported on the status of S.B. 344 A.B. 692 changing the minimum
dividend
rate in the statutes from 2% to a minimum of .5% which would permit a dividend
from WRS
for 2003 of 1.4% from the Fixed Fund.
Bill Ford also mentioned S.B. 453 by Senator Wirch exempting the first $5,000.00
from any pension system for everyone from state income tax.
Dave Mills, Executive Director of SWIB, was guest speaker and presented the
same information as presented at the ETF Round Table on 2-12-04. (Note ETF
Annuitant
Round Table article in the February 2004 SEA Newsletter.)
The next WCOA meeting is scheduled for March 17,2004.
Melvin B. Sensenbrenner,
SEA Retirement & Health
Insurance Representative
******************NOTICE*********************
(This notice is intended for SEA members and their families only)
Dear Member,
I have proclaimed April 28, 2004 as State Engineering Day at the Capitol
Our 6th Annual "Visit the Hill Day" or State Engineering Day, is being held on
Wednesday, April
28, 2004. At this time I am waiting for a Room location in the Capitol.~
We!!. April 28. 2OO4
8:30 to 9:00 Meet in the Capitol Rotunda
9:00 to 9:30 proceed to Capitol Meeting area (the Info Desk clerk will know what
room we will
be in)
9:30 to 10:30 Briefings/Instructions/Handouts in meeting area
10:30 am to? meet your legislators (lunch on your own or with groups).
Please call your legislators, or email them (can all be found at
http://www.legis.state.wi.us/) to
request or alert them of your attendance as a member of SEA and as a courtesy to
let them know
when you can visit them or their staff.
I will be distributing a general letter to Governor's office, and the Assembly
and Senate offices
to alert them too. We may have a press release. I will forward a legislative
list of all legislators
and their room numbers to the local Presidents. A map of the greater square area
with parking
will be included. There are many public parking ramps around the Square.
Remember, many elections are being held this fall and now is a good time to get
involved.
Weare using the March newsletter to distribute this to the members to save time
and money.
Please consider attending this event. Your local President/officers can fill you
in prior to this
event. Feel free to contact me if you have further questions. Local treasuries
should be
reimbursing some of the major travel expenses, but this will be specific to
which local you are in.
Contact your President for further details on reimbursement. Your unsettled
contract, new
health plan, taxes, position with your employer, and many, other state and local
issues should be
enough impetus to rally at the Capitol on April 28, 2004. Thank You.
Sincerely,
Larry Legro
2nd VP SEA Board - Legislative~ Liason
608-834-5804 (Sun Prairie)
lalegrol@cs.com
ETF GROUP INSURANCE BOARD MEETING - FEBRUARY 17, 2004
Local Government Employers Group Health Plans Status as of December 31,2003:
9 agencies terminated plans all located in central and Northern Wisconsin.
21 new employers are joining the system in 2004 and have passed resolutions
by their Boards.
Legislative Report:
A.B. 674 allows health insurance coverage for annuitants of WRS who
become re-employed by the State. There was little or no support and will not
move forward.
A.B. 690 Provider participation requires annual period to elect to participate
and requires notice to a provider reasons for exclusion.
A.B. 72l/S.B. 362 allows supplemental credits for purchase of health
insurance for dependents of state employees who die while employed by the
State or laid off.
An optional Dental Blue Plan Proposal by UW to extend the current UW plan
which ends March 31,2004 with some modifications was noted.
The proposed changes are in addition to any HMO coverage provided and offers
a New Preferred Provider Plan Network allowing freedom of choice. The state will
be
divided into two premium level regions: (1) with HMO basic coverage; (2) without
basic
dental by HMO's.
The Group Insurance Board Schedule of Uniform Benefit Changes for 2005 Plans
approval is as follows:
2-25-04 ETF staff discussions identifying those issues to be included in the
first draft.
3-1-04 Send draft to HMO plans for their comments due 3-12-04.
3-19-04 Staff discussion group to meet and finalize recommendations to the Group
Insurance Board due 3-24-04.
4-20-04 Recommendations to be presented to the G.I.B. for approval. All SEA
Board members have copies of this.
The next ETF Group Insurance Board Meeting is set for April 20, 2004.
Melvin B. Sensenbrenner,
SEA Retirement Health
Insurance Representative
