Late last week, after several failed attempts, the Legislature’s Joint Finance Appropriation Committee (JFAC) set the state employee pay raise. Rather than a strict percentage, the pay raise, known as the Change in Employee Compensation (CEC), provides a $1.05 to $1.55 per hour increase range for most state employees, with $1.55 roughly equaling a 5% increase. The measure also includes an additional 4.5% for engineers and IT staff and an even higher rate, up to 8%, for the State Police. Suffice it to say that this was the largest dollar cost pay increase in Idaho history at a projected $177.4 million. That is only the cost of the increase, not the entire cost of payroll.
This year, for the first time in recent memory, the governor upped the increase request from his own Department of Human Resources (DHR). In reviewing the last decade of recommendations, DHR was at or above the Governor’s recommendation, not the other way around. Here is the language from last year’s Legislative Budget Book comparing the DHR request to that of the governor:
“The Division of Human Resources (DHR) recommends an increase in employee compensation of 4.5% distributed on merit and an additional 6% for law enforcement employees. DHR also recommends new salary schedules for nursing/healthcare, and IT/engineering. The Governor recommends an increase in employee compensation of 3% and does not recommend a compensation increase for group and temporary employees. The Governor does recommend the changes to the salary schedule.”
This year, the governor one-upped his own DHR Manager.
DHR’s lengthy compensation report recommended a 4% increase at a cost of $146.4 million. In turn, the governor and JFAC settled around 5% at a cost of $177.4 million.
Does the difference between 4% and 5% really matter? It sure does.
Over the past decade, the CEC has averaged about 3.4%. The difference between a 4% increase that costs $146.4 million and the approved 5% increase that costs $177.4 million is over $400 million extra. The chart below explains that when you compound the two increases going forward, using the 3.4% average of the last decade, the bigger increase costs $405 million more. Folks, this is a perfect example of how rapidly the government grows when no one is paying attention to the numbers.
But that’s not all. It seems the winds of big increases have blown through the Capitol. House Bill 124 would increase the salaries of judges by a range of 27% to 31% depending upon the court — magistrates, district, appellate, etc. Similarly, House Bill 188 and House Bill 189 provide similar increases to judges spread out over several years. And House Bill 156 would increase the compensation of Parole Commissioners by 33%. What we see is a game of leapfrog. And where it all ends up is with hundreds of millions of dollars of more spending.
No wonder state spending has increased by 53% over the last five years. And, with this start on pay, it is hard to envision a reversal any time soon.
