According to the Courthouse News Service, "The Service Employees International Union claims Massachusetts violated the state's "Pacheco Law" by privatizing services in the Department of Mental Health, and laying off more than 100 case managers."

As we have detailed, the Pacheco Law sets extremely high barriers for privatization of state services, going beyond what virtually any other state in the country requires.

From today's New York Daily News: Governor Andrew Cuomo has told state lawmakers pension reform is his highest priority and he is willing to let the government shut down if they don't pass it.

"The reforms are projected to save the state and local governments $113 billion over 30 years, including $30 billion in savings for the city.  “The current pension system is great for the people who are in it, and it is an abject failure for the taxpayers of this state,” Cuomo said."

Governor Deval Patrick deserves credit for the reforms he has championed -- pension reform, municipal health care reform, and reining in police details. 

However Jim Stergios of the Pioneer Institute points out in last week's Boston Globe that there is still a long ways to go before Massachusetts is on sound financial footing:

"The fact is that the Bay State addressed its billion-dollar-plus structural deficit by pushing off the repayment date for the state’s $18.6 billion unfunded pension liability. In essence, we “refinanced’’ our pension debt by deciding that we will not repay the liability by 2025, instead electing to pay it off 15 years later, by 2040.

"Worse, the pension refinancing scheme killed the tacit agreement among legislators to pay out the pension liability by 2025 so we could begin paying down our other unfunded multibillion-dollar liability - the state’s $15.6 billion liability for health care coverage for retired state employees... The state will now pay billions of extra dollars in the future on the pension liability. That is an unfair burden to place on future generations, just so we can continue spending now."

Commonwealth Magazine ran a piece last week about all the politicians lining up lawyers in advance of possible charges in the Probation Department scandal.

"Campaign finance records indicate a number of lawmakers identified as frequent sponsors of job candidates at the Probation Department have hired lawyers using money from their political accounts. The payments don’t specify why the lawyers were hired, but the fees come at a time when nervousness about the probation investigations is reaching a fever pitch on Beacon Hill."

This morning's Globe op-ed by Scot Lehigh: "It's a battle some doubted would ever be waged, let alone won. But now, municipal health reform, which lets cities and towns bring local health care plans into line with state offerings, is paying big dividends."

- First-year savings expected to exceed $100 million
- Savings are being shared with local employees
- House Speaker Robert DeLeo and Ways and Means Committee Chairman Brian Dempsey deserve a lot of credit for their political courage in pushing the law through

Has your city or town taken advantage of the new law?

This morning's op-ed from Scot Lehigh: "It’s a battle some doubted would ever be waged, let alone won. But now, municipal health reform, which lets cities and towns bring local health care plans into line with state offerings, is paying big dividends."

__According to this January 26 Brockton Enterprise article, Brockton is considering taking advantage of the new municipal health care law passed last year (with the help of Voters Count) to negotiate less costly health care benefits for city workers.

"When the City Council’s Finance Committee meets on Feb. 6, its  members will be sitting between a rock and a hard place. On one side is Mayor Linda Balzotti, who wants to save the city millions of dollars by adopting the state’s municipal health care reform law.    On the other side are city unions are looking to protect their collective bargaining rights over health benefits."

The benefits to the city are huge: "If the city had the insurance reforms in place for the current fiscal year, it would have saved about $4 million in premiums, while employees and retirees would have saved $2 million, according to Balzotti." 

$4 million is a lot of money that Brockton could then apply toward schools, police and firefighters.

"She said saving $4 million next budget year – 25 percent of which would have to be returned in the first year to the employees hardest-hit by the insurance changes – would be a “huge” help in balancing the city’s budget."
 
In addition, "By switching to less expensive plans for current and retired workers, the city would also be decreasing the un-funded health benefits it owes its current and future retirees, currently valued at $693 million over the next 30 years."

From the Jan. 21 Boston Globe: "Two months after being embarrassed by revelations that the Chelsea Housing Authority executive director was receiving $360,000 in annual pay, the state agency that oversees hundreds of housing authorities statewide is imposing a salary cap that would allow pay no higher than $160,000."

State officials are also seeking "to eliminate pay to members of the local boards of directors that govern housing authorities." They commonly receive $5K per year.

The article goes on to say that a review of other housing authority salaries found none receiving anywhere near what Michael McLaughlin's wildly inflated salary.  "With McLaughlin gone, state records show that the highest paid housing directors are Richard J. Sergi of Brockton, who is paid $166,527 to manage 3,430 housing units; Gregory Russo of Cambridge, who makes $165,380 to manage 2,700 housing units; and Joseph Macaluso of Somerville, who is paid $160,000 to oversee 2,520 housing units." (McLaughlin was managing 1415 units)

_"Jack Wilson is no longer president of the University of Massachusetts, but the state is paying him a presidential salary of $425,000 while he takes a yearlong sabbatical. He has pulled in $568,429 from UMass this calendar year, making him the fourth highest-paid public employee in Massachusetts. He may also receive more as a professor than the university previously announced, under an agreement that was never approved by the full UMass board of trustees. His salary could land the state in a national controversy over perks for departing university presidents."

Globe subscribers can read the rest here

Mass. is not the only blue state making changes to its pension system - Rhode Island went further than Mass. by making changes that affect current retirees, not just future ones like Mass. did.

The situation was pretty dire though: "Many states are wrestling with rising pension costs, but Rhode Island's situation is among the worst in the nation. According to research from the Pew Center on the States, Rhode Island is one of only two states to have less than 50 percent of the funding needed to cover benefits that public sector employees have already accrued."

The legislation suspends cost-of-living adjustments for those collecting state pensions and raise the retirement age for most employees. It also sets up a hybrid system for state employees and teachers, mixing a traditional pension with a retirement account similar to a 401k.  Read more here.