State worker Rochelle Johnson’s $38,000 salary never allowed her family to live in luxury. Then the furloughs hit, cutting her pay by 14%.
Now Johnson, an appointment scheduler at a California agency that reviews disability applications, finds herself at the mercy of payday lenders, utility companies’ patience -- they shut off her power once already -- and co-workers who share their lunch leftovers.
But nothing has torn at Johnson like her son’s decision to reenlist in active duty for the Army National Guard. Greg Smith Jr., a 21-year-old reservist who has already served a tour in Iraq, said the battle-zone bonuses will help his mother and 15-year-old sister make ends meet.
“I just feel like I’m less than a parent,” Johnson said.
It’s an unprecedented and uncomfortable time for a state workforce long immune to the bumps and bruises of California’s boom-and-bust economy. Pay for civil servants can be modest, but the trade-off had always been a stable income and a reliable retirement.
No longer. With furloughs ordered through next June, many state workers now find themselves falling short on mortgages, relying on handouts for food and staring into the abyss of bankruptcy.
Confronted with California’s intractable budget shortfalls, Gov. Arnold Schwarzenegger required more than 200,000 workers to take two unpaid days off per month starting in February to save money; he later added a third day. Twenty-two other states have enacted or proposed furloughs since 2009, according to the National Conference of State Legislatures. None is forcing as much time off as California.
State finances are not always the better for it. Tax collectors bring in far more money for the state than they cost -- but only if they are working. And forced days off for some other employees causes the state to forfeit federal dollars, earning rebukes from top Democrats in Washington, including Vice President Joe Biden and Sen. Dianne Feinstein.
But the Schwarzenegger administration, empowered by a series of court victories to cut billions of dollars from the state payroll, says near-universal furloughs are the fairest approach. And most state employee unions are working under expired contracts, limiting their ability to protect their ranks as they have in past budget crunches.
Carrie Ann and John Quintos of Chino work for California’s workers’ compensation insurer and earned a combined $70,000 before the furloughs. The pay cut made their $3,200 mortgage unaffordable.
Selling the house was impossible; they owed more than it was worth, so they rented it out and took a town house. But their tenants missed a payment and the couple, in turn, missed payments of their own. Then their car was repossessed in the office parking lot.
“It was the most embarrassing moment that I’ve ever endured,” said Carrie Ann Quintos.
The couple got the car back but gave up the town house. Now John lives with his parents in Moreno Valley; his wife and four children are with an aunt in Chino some 30 miles away.
“I don’t know how anyone can be expected to live like this,” said Carrie Ann.
Schwarzenegger has cast the furloughs as an alternative to mass layoffs, an option in which “everyone takes a little haircut rather than laying people off,” he said in January.
But bankruptcy attorneys in the Sacramento area, where many state employees live, say that in recent months, as the pay cuts have mounted, many of their clients have been government workers.
“It’s always the same thing,” said attorney Stephen Koonce: “ ‘I was doing OK until this last round of furloughs, and that just put me permanently behind.’ ”
Court statistics show that in the district that includes Sacramento’s hub of state government, bankruptcy filings rose 63.6% in the year ending June 30, 2009, compared with the previous 12 months. The records do not indicate how many filers were state employees.
California’s unemployment rate, meanwhile, climbed to 11.9% in July, up from 7.3% a year earlier. So state workers suffering from the recession have plenty of company.
However, “I don’t see a lot of public sympathy,” said Daniel Mitchell, a professor of management and public policy at UCLA. The public, he said, fears the alternative would be “to raise my taxes.”
Some employees are exempt from furloughs -- California Highway Patrol officers and state firefighters during wildfire season, for example. And the legislative and judicial branches are not covered under the governor’s order. Statewide elected officials, such as the state attorney general and treasurer, have refused to enforce the furloughs. The governor has taken them to court, winning an initial ruling that has been appealed.
In some limited cases, the furloughs could be waived at little or no cost to the state.
The $2.2 billion in pay cuts is expected to save the state’s general fund only $1.3 billion in this budget year. The other $900 million is paid from separate funds or with federal money. Most workers are paid through a combination of sources.
Rochelle Johnson’s pay comes entirely from the federal government.
“Why are we furloughed if we are federally funded?” she asked. “I don’t think I should have to put my child in danger because Arnold decided on what was best for me.”
In July, Biden wrote to the National Governors Assn. to ask that workers who help determine eligibility for disability services be exempted from the furloughs. Reducing their time, he wrote, “would delay monthly benefits to disabled Americans and their families.”
Feinstein entered the debate last week with her own letter to Schwarzenegger. She called the furloughs “harmful and short-sighted.”
Despite such pleas, the administration has refused to roll back any furloughs, though it allows flexibility in their timing in some cases.
“We would be discriminating against other state employees if we said, based on your funding source, we’re going to apply a different personnel policy to you,” said Lynelle Jolley, a state Department of Personnel spokeswoman.
Other furloughs have been challenged too. Unpaid time off for tax collectors at the state Franchise Tax Board is projected to save $60 million through next June, the end of the fiscal year.
But their furloughs will cost $550 million in lost revenue over the next three years, the board estimates.
“Why would we do that?” Sen. Denise Moreno Ducheny (D-San Diego) asked at a hearing on the issue last week.
Renee Lee, who works in a call center for the tax board, angrily told senators at the hearing that after her 30 years of civil service, the home she has lived in for 18 years is in foreclosure.
“I was living the American dream,” Lee said. “I am living a nightmare now.”