Pa. State Union Contracts Cost Taxpayers an Additional $1 Billion

How much is the cost of doing business with Pennsylvania state government unions? For the most recent round of contract negotiations, an additional $1.15 billion over the next four years.

Several weeks ago, Government Wolf’s administration finalized contract negotiations with three unions representing Pennsylvania state employees: the American Federation of State County, and Municipal Employees (AFSCME 13), the Service Employees International Union (SEIU 668), and the United Food and Commercial Workers (UFCW).

Per Act 15 of 2016, the Independent Fiscal Office (IFO) just released analyses of the additional tax dollars needed to cover the salaries, benefits, and health care contributions of these state, social service, and liquor store employees.

From 2019-23, the required annual salary percentage increases will cost an extra $1.04 billion, while employer health care contributions will cost an additional $106 million.

This expands upon past contract cost increases. Wolf negotiated $3.4 billion in compensation increases in 2015, and another $600 million in 2017.

See this chart for a breakdown of additional costs for each union.

Chart: Cost of Pa. State Union Contracts 2019-23

Dedicated state workers deserve just payment for a job well done. This negotiation process, however, lacks accountability to all taxpayers, far exceeds industry standards, and outpaces the growth of private sector compensation. Why does this matter? Every tax dollar spent on these contract-required payments is one less tax dollar for other government services.

The high price tag of the new state union contracts is not surprising. After all, Wolf negotiated—in secret—with the very union officials who donated $5.9 million to his election campaigns.

This inherent conflict of interest is a disservice to taxpayers, who depend on the governor to represent their interests at the bargaining table. It’s important to bring transparency to the negotiation process for current and future generations of Pennsylvania citizens.

• Sen. Pat Stefano’s Senate Bill 339 and Rep. Matt Gabler’s House Bill 250 require government to publicize proposed contracts and their cost before they go into effect.
• Sen. Ryan Aument’s Senate Bill 448 subjects contract negotiations to Pennsylvania's Sunshine Act and Sen. Scott Martin’s Senate Bill 449 subjects collective bargaining documents to the Right to Know law.

Pennsylvanians shouldn’t be kept in the dark when public officials negotiate billion-dollar contracts with their political donors. With greater transparency will come greater accountability to taxpayers’ ability to pay.