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Student fee increases linked to union contracts

By Jillian Poland

The portions of the 2014-17 union contracts unfunded by the Commonwealth of Massachusetts account for 80 percent of student fee increases across the state university system, said Vincent Pedone, executive director of the Council of Presidents (COP).

There are three unions for state university employees: The Massachusetts State College Association (MSCA) for faculty and librarians; The Association of Professional Administrators (APA) for staff; and The American Federation of State, County and Municipal Employees (AFSCME), which includes maintainers and some campus police officers.

All of the unions bargain separately with the Board of Higher Education (BHE), an executive department that reports to the governor, to create a collective bargaining agreement (CBA), a document that determines the terms of employment. The terms include guidelines for salary increases, benefits and workloads.

The collective bargaining agreements are typically valid for a three-year period before they expire and must be renegotiated. All three unions are currently in the process of bargaining new contracts, as the 2014-17 contracts have expired.

Salary increases have become a point of tension between the BHE and the three unions as months have passed without any final agreements. MSCA members have pointed to the BHE and COP’s reluctance to provide what they feel is an adequate financial offer as a reason for the slow negotiation process.

In a statement prepared for a BHE meeting on Oct. 31, Chair of the Council of Presidents Fred Clark said the “unfunded liability” of the 2014-17 CBAs – the portion of the cost increases not covered by funding from the commonwealth – is nearly $33 million across the state university system.

There is also an additional $10 million in “fringe benefits,” which includes portions of employees’ health and life insurance, that commonwealth funding does not account for, said Clark.

The universities are required to pay the salary increases the BHE negotiates in bargaining whether the state provides additional funding or not. In order to cover the costs, the individual universities are “forced” to use a combination of operating budget cuts, one-time revenues, campus reserves, foundation funds and student fees, said Clark.

He added, “No matter how much our campuses maximize efficiencies, reduce costs and enter into collaborative agreements, we could never make up this $33 million shortfall realistically without impacting student fees.”

Pedone said while the commonwealth was legally required to fund the first year of the previous CBAs, it was not required to add this funding to the base amount appropriated to the state universities or to fund the following years.

As a result, by the second year of the 2014-17 contracts, the state universities had to account for the cost of the first year of salary increases in addition to the salary increases of the second year without any additional funding from the state. The trend continued in the third year of the contracts, compounding the issue, Pedone said.

“In effect, the administration negotiates these labor agreements and tells the campuses to figure out a way to fund them,” Pedone said.

He added, “Like any other business, employees’ salaries make up a significant portion of an operating budget, and if the campuses are obligated to honor the contracts – which we should be and we do – then those contracts have to be paid by somebody – either the state or some other resource.”

Since the state universities do not have the capacity to get other types of governmental funding, such as workforce and labor grants, they are “specifically handcuffed” in regards to their operating budgets, Pedone said.

He added, “The commonwealth has to understand that they’re partners in this, and at this point, the state is only about a 30 percent partner in our operations.”

Dale Hamel, executive vice president, said while the new CBAs have not been finalized and percentage increases in salaries are not yet determined, based on the assumptions used to create the Fiscal Year 2018 budget for FSU, the anticipated cost to FSU of CBA increases is $636,000.

Net revenues from student fee increases at FSU will be approximately $900,000. So, the cost increases for non-state-supported personnel is “a bit over” 70 percent of revenue generated by additional student fees, said Hamel.

Robert Donohue, MSCA vice president and president of the Framingham State MSCA chapter, said he does not think linking student fee increases directly to the CBAs is an “intellectually honest argument.”

He added, “The reason for that is that if you track state funding going back for the last several decades, the state has decreased its per-student funding – adjusted for inflation – about 33 percent. So, if the state were keeping up with what the state used to contribute, that would take care of the student fees in a big way.”

Massachusetts has “historically been almost at the bottom” of funding for public higher education when compared to the rest of the nation, said Donohue.

In 2015, Massachusetts ranked 30th in the nation for capital spending per student for public higher education, according to the Massachusetts Budget and Policy Center.

“That, I believe, is a much more coherent explanation for the extremely high fees that students in Massachusetts face,” said Donohue.

He added, “The last time we ran into an impasse with the [CBA], the union made public an awful lot of expenditures from the state universities that we thought were questionable. So, if the administration wants to point to the union contracts as driving up student fees, the union has any number of expenditures that the administration has made at its own discretion that we would point to as perhaps not being particularly justifiable when you think about its impact on student fees.”

Pedone said he agrees with Donohue that this is a problem of funding from the commonwealth.

“This is not the blame game. Management is not blaming our employees for pay increases,” Pedone added. “It’s not the fault of the union members at all – it’s that it seems that the state is divesting from funding public higher education.”

Pedone said the salary increases are the “well-deserved” result of the university employees’ “continued hard work.”

He added, “However, not recognizing that the cost of contracts adds to the bottom line is silly.”

The CBAs are not the sole reason the commonwealth is not adequately funding public higher education, but they do add to the operating costs of all the universities, said Pedone.

“No matter how efficient we become, it’s hard to absorb $8 million a year compounded over the course of three years without impacting student fees,” he said.

Mark Powers, FSU’s registrar and APA chapter president, said overall salaries are always a significant amount of any budget, but the CBA increases only account for the employees in the three unions.

He said in an email, “The Non-Unit Professionals or NUPs (meaning not part of any of the three unions), which includes the University president down to associate deans, also receive annual increases that only come from the institutions’ operational budgets.”

Hamel said the BHE has approved salary increases for NUPs that are equal to or below the rates granted through the CBAs. “So, it is accurate to note that they are essentially comparable to the effect of the CBA cost increases.”

According to numbers provided by Erin Nechipurenko, assistant vice president of Human Resources, 94 percent of FSU employees are union employees and 6 percent are NUPs.

Pedone said everyone, from the union members to the administrators, is “speaking up” to ask the commonwealth to support the public colleges and universities.

The Public Higher Education Network of Massachusetts (PHENOM) is an organization comprised of students, alumni, faculty, staff and community members from the 29 public colleges and universities in Massachusetts.

PHENOM is leading a number of initiatives to lobby for more affordable public higher education in Massachusetts.

Pedone said, “As 29 public college campuses – UMass, state universities and community colleges – all working together, we work really hard to push an agenda which would win more money back to the campuses.”

He added, “Funding our contracts is a significant cost to the universities, and it’s something that we can absolutely point to when we’re speaking with lawmakers who are writing budgets and show them directly the cost impact of our salaried employees.”

Pedone, who was a state representative for 20 years, is working to get legislative support for an act that would provide funding for the CBAs. He said the act is still in committee and isn’t progressing very quickly.

Students from the public colleges and universities need to make their concerns heard if they hope to see any change in state funding, said Pedone.

If there was ever a “hint” that the commonwealth was considering cutting or even level-funding K-12 education, there would be “massive protests” at the State House and every school-committee member, teacher, mayor and parent would be calling, said Pedone.

“And we essentially cut public higher education funding in half, and there was no outcry.”

This is not just a Massachusetts problem. According to the Center on Budget and Policy Priorities, state spending on public colleges and universities across the nation is well below historic levels,

Pedone said, “We have 72,000 people going through our schools. What if they all called the governor and said, ‘We know you’re putting together your budget governor. Public higher education has to be funded. It is our priority. We will consider our vote based on your commitment to higher ed? That would be very impactful.”

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