They're called ghost workers. State workers paid for not working, and instead enganing in union business. Your property taxes are only getting higher!

PAID FOR NOT WORKING;TAXPAYER RIPOFF #1: Ghost Workers and the Triple-Whammy of Union Release Time

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One of the most objectionable schemes of government union collective bargaining process, which excessively drives up the cost of government for taxpayers, in ways or at levels that do not exist in the private sector, is being paid for not working. This issue, along with many others defined in the Center’s report, Public Union Excesses, contribute to an $888 million per year in excessive collectively-bargained costs, responsible for driving up local property taxes by up to 25%.

After looking at examples in just a few cities and towns, municipal taxpayers across Rhode Island may collectively be paying millions of dollars per year for unionized government employees to spend their public time on work for their unions … and not to work on the public services they were hired to perform.

Adding insult to injury, the many collectively bargained provisions that specifically allow for these so-called ‘ghost workers’ may actually be in violation of state law. More on that later on.

As detailed in the Center’s landmark report, Public Union Excesses, there are multiple schemes in which government unions benefit from overly generous provisions in collective bargaining agreements, provisions that hardly, if ever, are seen in the private sector.

One such provision is called “union release time.” Under this scheme, unions across Rhode Island use taxpayers as contractual piggy banks to fund union activities. How many Rhode Islanders know that they are paying for ‘ghost workers’ who are paid by the public, but who do not actually perform a public service for some or all of their official time? Instead, a common provision — found in many government union collective bargaining agreements — mandates that taxpayers pay the salary and benefits for for certain public employees, who spend time working on their unions’ business.

Union ‘ghost workers’ impose a triple-rip-off on taxpayers.

First, there is the direct cost of paying public workers for not working on public issues. Second, compounding the cost, taxpayers are further ripped-off because, often, an extra worker must be hired (sometimes at overtime rates) to fill in for the ghost worker’s shift.  Third, union workers who are paid with taxpayer dollars to work on union issues … are working directly against the very same taxpayers who pay their salaries. As the Center’s Public Union Excesses report breaks down, collectively bargained government union excesses directly raise property taxes by as much as 25% for every Rhode Island family and business.

This union release time scheme is indeed a rip-off for taxpayers, as many of the designated union ‘ghost workers’ are awarded six-figure compensation packages, paid for by the public … but without the public’s receiving a commensurate return.

In its report, Public Union Excess, the Center estimates that taxpayers in Portsmouth, Rhode Island, are wasting over $8,176 per year on ghost workers, 100% of which is considered “excessive” in the report. This figure does not include the ‘replacement’ costs to hire additional staff.

However, the ‘ghost worker’ issue is much more costly in other cities and towns. In the Rhode Island’s capital city of Providence, for example, Maribeth Calabro, a special educator, whose $83,848 salary and compensation package worth well over $100,000 per year is paid for by local taxpayers, is also president of the Providence Teachers union. Per the city’s collective bargaining agreement with her Providence Teachers Union, Calabro is allowed to spend 40% of her teaching time (with full pay and service credit) to conduct union activities, costing taxpayers over $33,000 per year. Add in the cost of substitute teachers, estimated at over $16,000 per year, and Providence taxpayers are being ripped-off to the tune of almost $50,000 per year … just for this one teacher.

In the 2016 East Providence teachers’ contract, high school teacher and local union president Nicholas Shattuck is allowed to spend 40% of his teaching time, as part of his estimated $70,000 salary, on union business. “The President of the Association shall be relieved of all his/her non-teaching duties to take care of Association business. In addition, the President shall be provided the equivalent of two (2) full days per week at no loss in salary or benefits and the Association agrees to pay one-half (1/2) of the cost. Meaning that the School Department pays for one day and the Association pays for one day.” The estimated net ‘ghost worker’ cost of $14,000 per year, plus substitute costs at around $15,000 per year, means that East Providence taxpayers are bearing costs of almost $30,000 per year for this one paid public employees to conduct union business that constantly works against the better interests of those same taxpayers.

In Tiverton, there is a minimum trifecta of ‘ghost worker’ union release time provisions.  Elementary school teacher and local union president Amy Mullen is allowed one teaching period per day (20%)  for “union business.” At a salary of over $75,000 per year, the total rip-off to taxpayers, including the cost of substitute teachers, is likely over $30,000 per year. Provisions in Tiverton’s firefighter and police union contracts are less costly, having mainly to do with periodic conventions and meetings, but still may add over $10,000 per year in ‘ghost worker’ costs to taxpayers.

The above examples do not take into account common provisions that relieve union officers of “non-teaching duties” (for example). We did not attempt to value these activities, but exempting union officers likely has a cost of thousands of dollars, either in lost benefit to taxpayers and constituents or in the increased burden on other employees.

Unauthorized release time. But the rip-off to taxpayers does not end here. While it’s one thing for taxpayers to bear the burden for “authorized” release time as collectively-bargained for ghost-workers, it’s quite another thing for these same ghost-workers to cause “unauthorized” release time for co-workers. For instance, our Center has anecdotally been told by numerous former educators that it is common practice for local union NEA officials, who themselves were on release time to conduct ‘union business’ at the expense of the taxpayers, to simply walk into classrooms and pull other teachers (and fellow union members) out of their classes for meeting on various topics … often leaving entire classrooms unattended. In one instance, the so-called ‘union business’ that the authorized and unauthorized ghost-worker teachers were discussing … was to scheme how to get rid of a school administrator that the union did not like.

On the legal side, state law appears to prohibit these collectively bargained schemes. Under the state Labor Relations Act, Rhode Island General Law 28-7-13 states that “it shall be an unfair labor practice for an employer to” give preference to “any employee organization”:

By compensating any employee or individual for services performed in behalf of any employee organization or association, agency or plan, or by donating free services, equipment, materials, office or meeting space, or any thing else of value for the use of any employee organization or association, agency, or plan; provided that an employer shall not be prohibited from permitting employees to confer with him or her during working hours without loss of time or pay.

Rhode Islanders expect their hard-earned money to be spent to educate our children, protect our homes and businesses, or to provide other vital services. We do not expect that our money will be spent to advance the work of overly politicized unions.

According to our Center’s report and this follow-up post, not only are taxpayers grossly overpaying for government services, but they’re also regularly paying out their hard-earned money to government workers who are not even working! Whether it’s paying for release time where union members are paid by taxpayer for doing union work, overly generous vacation and personal days, paying for public employees on sabbatical, paying for suspended workers, paying for years and years for people out of work on dubious injury claims … or paying unsustainable levels of post-employment benefits …  taxpayers are being ripped off.

If public workers want to assist their unions, the should do so on their own time or be paid out of  the dues of union members … not on public time and certainly not on the public nickel. If we can bring these and other public union excesses into line with the private sector, your property taxes could be reduced by 25%.

Ghost Workers – Government Workers who are Union Officials Paid for Not Working – Drive-up Property Taxes

And it may even be illegal …

Providence, RI— One of the most objectionable schemes of collective bargaining contracts with government unions are provisions not found in the private sector that pay workers for not working, that increase the cost of government, and that unfairly drive up property taxes. Even more egregiously, in this case, public employees are being paid by taxpayers to work for someone else.

According to a post today as follow-up to to the RI Center for Freedom & Prosperity’s landmark Public Union Excesses report on the excessive costs of collectively bargained government services, ‘union release time’ provisions that allow for “ghost workers” – public employees paid by the public NOT to conduct work for the public; but rather paid by the public to conduct union work – are a major taxpayer rip-off.

In the post, Paid For Not Working; a Taxpayer RipOff; Ghost Workers and the Triple-Whammy of Union Release Time, multiple examples of contract language, as well identification and cost-calculation of actual ‘ghost workers’are provided.

“Worse, this unfair and unjustifiable practice appears to be in direct conflict with state law,” exclaimed Mike Stenhouse, CEO for the Center. 

For example, in the city of Providence’s collective bargaining agreement with the Providence Teachers Union, publicly paid special educator, Maribeth Calabro, also the local union president, is contractually allowed to spend 40% of her school schedule (with an estimated $100,000+ compensation package) on union business. Add in the cost of substitute teachers and the total annual cost to taxpayers likely exceeds $60,000 per year.

The full ghost worker post provides other individual examples and also discusses:

  • The ‘triple-whammy’ on taxpayers, once substitute worker costs are added-in
  • State law on what constitutes and “unfair labor practice”
  • Further abuses of unauthorized release time

“If public workers want to assist their unions, they should do so on their own time and on the union’s nickel,” suggested Stenhouse, “and certainly not at the taxpayers’ expense.”

According the Center’s May 2019 Public Union Excesses report, Rhode Island taxpayers dish-out $888 million per year (or $3500 for a family of four) for excessive compensation provisions in collective bargaining agreements with government employee unions, which may drive up local property taxes by as much as 25%.

Employment Rate Rhode Island Jobs April 2019

Jobs & Opportunity Index (JOI), April 2019: The Consequences of Treading Water

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In an unusual circumstance 11 of the 12 datapoints used for the RI Center for Freedom & Prosperity’s Jobs & Opportunity Index (JOI) were updated for April, and the end result was not a happy one. RI overtook Louisiana in 2017 to claim the 47th rank in the country after five years at 48. For the month of April, RI has lost that gain, despite improved numbers by five measures.

Click for full PDF including national table

Employment was not one of those five, down another 269 people from the first-reported number for March, and the labor force dropped yet another 1,009. Jobs based within the state represented a bright spot, with an increase of 5,400. Alternate measures of unemployment gave RI two more positive developments, with long-term unemployment down 600 and marginal attachment to the labor force down 200. However, this seems likely to have been caused by worker exits. This more-negative interpretation is justified by the fact that people who are involuntarily working part time increased by 1,100.

On the welfare side, the Ocean State had 5,209 fewer people on Medicaid, which is positive. However, enrollment in TANF (welfare) was up 407, and the state still cannot manage to update its SNAP (food stamps) data, which haven’t moved since February 2017. The taxation picture is mixed. The federal government collected almost $200 million less from Rhode Islanders, but state and local taxation increased by $41 million.

The first chart shows RI remaining last in New England on JOI, at 48th. New Hampshire leads the region, in 3rd place, nationally. Vermont fell two spots, to 14th place, while Maine held steady in 18th. Massachusetts also remained in place, at 36th, but Connecticut dropped two, to 44th.

Race To First Place Jobs & Opportunity Index Rhode Island, New England Jobs April 2019

The second chart shows the gaps between RI and New England and the United States on JOI, and the third chart shows the gaps in the official unemployment rate. RI’s gap improved slightly in all cases.

Scores on Jobs & Opportunity Index- Rhode Island, New England, United States Jobs April 2019
Unemployment Rate Jobs & Opportunity Index- Rhode Island, New England, United States Jobs April 2019

Results for the three underlying JOI factors were:

  • Job Outlook Factor (optimism that adequate work is available): RI fell four spots, to 28th.
  • Freedom Factor (the level of work against reliance on welfare programs): RI fell six spots, to 48th.
  • Prosperity Factor (the financial motivation of income versus taxes): RI remained 47th.

Click here for the corresponding employment situation post on the Ocean State Current.

Click for full PDF including national table
The opioid epidemic is a widespread, complicated problem, and only a collective effort will begin to solve it not a harmful opioid tax.

Testimony: Opioid tax bill would harm families and businesses across Rhode Island

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To: RI Senate Committee on Finance
From: Rhode Island Center for Freedom & Prosperity, Mike Stenhouse
Subject: Written Testimony re. Opioid Stewardship Act (S0798)

Chairperson Conley, Jr. and Committee Members: As CEO for the RI Center for Freedom & Prosperity, a non- partisan research and advocacy organization, I would like to provide some background re. S0798, which is before your committee today. As a 501-C-3 organization, our Center is not advising you whether or not to support this legislation. However, we are allowed to discuss our research and perspectives with regard to pros and/or cons of the underlying issue.

For our written testimony, I am submitting, in its entirety, an opinion piece written by our Center’s Chairman, Dr. Stephen Skoly, who has ample medical experience in dealing with pain-killing drugs for his patients.

Thank you. Thank you. If I can answer any questions, please contact me.

Opioid tax bill would harm families and businesses across Rhode Island

By Dr. Stephen Skoly, a maxillofacial surgeon in Cranston, and Chairman of The Rhode Island Center for Freedom & Prosperity.

The opioid epidemic is a widespread, complicated problem, and only a collective effort will begin to solve it. The healthcare community and lawmakers need to work in tandem to find policies that effectively lessen opioid abuse while still keeping our state’s economic health as well the health and safety of the patient in mind. It’s unfortunate, however, that Senate Bill S0798, the Opioid Stewardship Act, fails on both accounts.

This bill seeks to levy $7.5 million in annual taxes on the healthcare system for the distribution of prescription opioid medications to healthcare facilities throughout our state, including pharmacies, hospitals, and urgent care clinics. The motivation behind the legislation is clear; legislators seeking to disincentivize use by taxing the products that they believe have contributed to growing rates of addiction and overdose. However well-intentioned, this is a costly approach that misses the mark.

Prescription opioids serve a clinical and legitimate medical purpose. Postoperative analgesia, cancer, trauma, and chronic disease are just a few examples of the many medical conditions and procedures that require opioid- containing medications.

Just like all taxes imposed by lawmakers, there will be reactions as these added costs will somehow be passed onto patients in the healthcare system. Employers that provide health coverage could see insurance premiums rise, while families could experience higher prescription costs; all for an epidemic being fueled by illegal behavior that S0798 would not address.

Those suffering and without adequate insurance would be most impacted, and would be incentivized to seek more dangerous drugs on the underground market.

As a medical professional, I find it morally reprehensible that our lawmakers might inflict economic pain on patients who are suffering acute physical pain; especially at a time when Rhode Island has one of the worst economies in the entire country.

Examples of the real and unintended consequences of taxes on prescription opioids are showcased in New York. In fact, Rhode Island’s Opioid Stewardship Act is nearly identical to a bill recently passed in the Empire State. This New York bill was loudly opposed by patients, healthcare providers, the business community, and other lawmakers, who expressed ire that the bill’s hefty and punitive tax would lead to increased costs or restricted access to care.

I find it confounding that Rhode Island lawmakers would draw inspiration from another state’s misguided legislation. Reacting to a crisis in haste, just to claim you did something, is itself misguided. This legislation represents another example of “not letting a crisis go to waste.”

There is no debate that a robust response to the opioid epidemic is necessary. But when developing policy, Rhode Island legislators need to acknowledge the importance of protecting the affordability and accessibility of necessary medications for our state’s patients and their families. The Opioid Stewardship Act fails to make these considerations. Rhode Island legislators need to understand that opioid prescribing protocol are evolving based on evidence based medicine and recommendation from The American College of Surgeons. Recommend best practices for prescribing opioids in Rhode Island includes accessing the Rhode Island Drug Prescription Monitoring Program (PDMP). Finally, it is important to recognize that addiction is neither a moral failing nor a character flaw. Rather, it is a chronic disease much like heart disease. Even our legislators should be morally offended by supporting a misguided tax on a chronic disease to balance their budget.

Rather than relying on added taxes, our lawmakers should promote more sensible solutions such as supporting efforts by our law enforcement agencies to purge our state of illegal drugs and by encouraging continued education of patients about the potential risks surrounding prescription opioid medications.

This tax would do nothing to address the core problems of inappropriate use and illegal distribution of opioids.

Greedy union bosses have corrupted state government, restricting municipal policymakers from governing their own affairs at the local level closer to the people.

Perpetual Contracts Will Keep Rhode Island in Perpetual Decline

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Providence, RI— Statement from Mike Stenhouse, CEO for the RI Center for Freedom & Prosperity on the “perpetual (evergreen) contracts” legislation that was signed into law today by the governor:

“The number one driver of the Ocean State’s declining population and jobs numbers –  are high property taxes. Our Public Union Excesses report clearly connects high property taxes with the excessively high costs of collectively bargained government services. This new ever-green contracts law will keep property taxes ever-high.

We continue to give an unfair advantage to the wealthiest and most connected insiders of the population, and now these special-interest groups come before the Rhode Island people and saying we don’t have enough … and we want more? This is outrageous!

It is clear today, that after 10 years of the slowest economic recovery among all states, Rhode Island’s political leaders are not fulfilling their promise to help the average family. Instead, by heaping more and more favors upon those who help get them elected, politicians have lost the trust of the people.

Beyond the financial costs, there is a more corrosive impact from this kind of political cronyism. People are fed up with betrayals from lawmakers who have forgotten them, who cater to special interest groups, and who make it harder to live and take care of their families and business – and to continue to reside and work in Rhode Island.

Sadly, Rhode Islanders will now have even less hope for our state, with even less trust in their government! In this case, perpetual contracts will make it much more likely that the state of Rhode Island will remain in perpetual decline.”

Public Union Excesses, the largest research report ever produced by the Center, details how Ocean State taxpayers are dishing out an extra $888 million per year as compared with their private sector counterparts; findings that are consistent with previous national studies, including a report by the Center in 2012. Rhode Island property taxes would be 25% lower were it not for the ‘excessive’ costs imposed on families and businesses for collectively bargained government services, in providing up to a 27% total compensation premium for government workers.

The Center refutes the unsubstantiated & off-target NEA-RI claims made by two government union officials in publicly responding to our Union Excess Report.

CENTER Refutes NEA-RI Claims about its Cost of Collective Bargaining Report

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Unions Respond with Mindless Attacks and Unsubstantiated Claims

Teachers Union Response Addresses the Wrong Points

Correction

Providence, RI— The Rhode Island Center for Freedom & Prosperity refutes the unsubstantiated and off-target claims made last week by two government union officials in publicly responding to the Center’s Public Union Excesses report. The eye-popping report details how Ocean State taxpayers are dishing out an extra $888 million per year in providing 26% total compensation premium for government workers as compared with their private sector counterparts, and that drive local property taxes 25% higher than they need be.

Typical of union tactics seeking to avoid discussion of the issue at hand, labor officials try to change the topic by responding with a barrage of subterfuge and attacks on the messenger. 

Robert Walsh, executive director of the National Education Association of Rhode Island made a series of apparently incorrect and misguided public comments when he claimed that Ocean State public school teachers make about $14,000 less in salary than their Massachusetts counterparts.

Mr. Walsh’s statement is off-target for a number of reasons:

  • The Center’s report focused on “total compensation”, while Walsh focused on just the “salary” component
  • The Center’s report compared all public sector workers to private sectorworkers in Rhode Island, while Walsh compared RI public teachers to MA public teachers
  • Most importantly, Walsh’s figures, in his attempt to downplay compensation for Rhode Island workers, do not match with public reports.

In his statement last week to the Providence Journal, Walsh claimed that RI teachers averaged $66,758 in salaries, compared to $80,357 in Massachusetts – a gap of $14,000.

However the salary figure reported in the official Employees’ Retirement System of Rhode Island (ERSRI) report show an average 2018 RI teacher salary of $77,581 – about $11,000 more than Walsh claimed. Further, the similar report in MA shows their average teacher salary (including Boston) was just $74,156 – about $6,000 lessthan he claimed. 

Walsh proceeded to dig himself into a deeper hole when he claimed on Twitter that the Rhode Island ERSRI figures were inflated because higher paid superintendents and other non-teaching positions were included: yet this reasoning ignores that the Massachusetts figures likely also include such positions, which only would minimally change the calculations by 1-2%. 

Per these two reports, Rhode Island teachers make about $3,000 more than do their Bay State counterparts, not the $14,000 less as claimed by Walsh.

Mr. Walsh’s initial statement about any gap could be off by as much as a whopping $17,000. When asked on Twitter to provide documentation for his figures, Mr. Walsh did not respond.

Additionally, the president of AFSCME, the largest government worker union in the state, J. Michael Downey, joined with Walsh in questioning the Center’s donor base and why it is not publicly disclosed. 

“Rather than professionally responding to the findings in our report, once again progressive-union-left leaders seek to shut down open and honest debate by mindlessly attacking the messenger,” responded Mike Stenhouse, the Center’s CEO. “Both Walsh and Downey know that the US Supreme Court has ruled that their is a major difference between government transparency and privacy for nonprofit organizations; and that donors to groups like our Center should be protected from recrimination by the  government or by over-zealous activists.” 

The Center is proud to have earned the support of about 500 in-state donors in support of its core mission to return government to the taxpayers. The Center accepts no public funding and receives no contributions from any out-of-state group that attempts to influence its agenda. The Center’s full donor privacy policy can be viewed here. 

The 48-page report was researched and co-authored by adjunct scholar to the Center, Dennis P. Sheehan, and by the Center’s research director, Justin Katz. The reports’ findings are consistent with previous national studies, including a report by the Center in 2012.

The full report also includes tables with town-by-town estimates of the excessive total compensation costs of government workers at the municipal level, in school districts, and in independent fire districts. 

CORRECTION: Stuart Peterson, actually the former School District Finance Committee Chair, in commenting on East Greenwich’s $9.5 million excess, was incorrectly listed as former Town Finance Director in the Center’s original media release last week: “The report’s findings are certainly in line with what we have seen in East Greenwich for the last 30 years. Our residents have seen (property) tax increases three times that of inflation, and up to four times that of median household income wage growth.”