State employee unions have rejected Gov. M. Jodi Rell’s call to offer the second worker retirement incentive program in two years, according to a statement released late Wednesday night by the administration.

But the State Employees Bargaining Agent Coalition responded that it didn’t reject anything. Rather, it said, it insisted that Rell assess how a second program would affect state services and the fiscal health of the pension fund – and that the administration refused.

The breakdown of the first negotiating session since mid-March between the Rell’s office and the unions left hanging not only the retirement incentive issue but also some legal, political and budgetary questions.

“The Governor is extremely disappointed that SEBAC – the coalition of state employee unions -tonight summarily rejected any consideration of an early retirement plan to save $65 million in state budget costs,” the statement from Rell’s office read. “She is also disappointed that SEBAC would not allow the administration to put alternative cost-saving measures on the table. Governor Rell believes it is a time for renewed respect and cooperation, not intractability and hyperbole.”

But SEBAC spokesman Matt O’Connor said the unions pressed Rell only to answer their questions, and to consider union proposals to streamline government.

And a written statement from the coalition, which represents more than 45,000 unionized state employees, said it was administration officials who ended the meeting.

Union leaders also “pressed for responses to cost savings proposals they made in January that would have improved services and saved more money than is estimated through the ERIP,” the statement read.

“We’re terribly understaffed already,” said Carmen Boudier, president of New England Healthcare Employees Union, District 1199/SEIU. “We have healthcare workers and corrections officers struggling through mandatory double shifts, and the state trooper force is below its statutory minimum. When bridges are found to need repairs, we don’t even have enough maintenance professionals to repair them.”

Dave Walsh, president of the American Association of University Professors chapter at Central Connecticut State University, said “college students are struggling to find courses they need to graduate, and we have backups and waiting lists for workers needing job services, and for businesses needing permits to create jobs. Why would the governor want to make a bad situation worse?”

Rell and the legislature agreed in November 2008 to launch an incentive program in mid-2009 designed to save $106 million this fiscal year, and $102 million in 2010-11. Just over 3,800 employees took advantage of this program. Numbers are still being compiled to determine how many state government positions vacated through this program have since been refilled.

Last week the governor proposed another retirement incentive program as part of a plan to eliminate a $726 million deficit projected for the preliminary, $18.93 billion budget adopted last September for the 2010-11 fiscal year.

This time around, Rell hopes to save $65 million by offering incentives not only to workers currently eligible to retire, but to others just a few years away. The administration estimates 3,000 workers would accept retirement under this program, which would be open to employees age 52 and older with 10 year or more of experience. Most state employees must reach either age 55 or 60, depending on when they were hired, to be eligible for retirement.

But SEBAC officials have said Rell and lawmakers should be focusing this year on proposals that create jobs, expand the economy and preserve vital state services.

The administration has insisted state government can offer a retirement incentive program without union approval, as was done in 2003, but that it prefers not to. But SEBAC argues that that a legal agreement reached in 200r effectively bars the governor and legislature from offering the incentives without union approval.

Legislative leaders had mixed reactions last week to the prospect of voting on retirement incentives not supported by union leadership.

House Speaker Christopher G. Donovan, D-Meriden, said late Wednesday that he’s wary of provoking a legal battle with the unions over an early retirement proposal that has raised so many concerns with labor.

“Right now there are a lot of questions about that proposal,” he said. “We’re trying to get a budget done, not get into fights.”

Keith has spent most of his 31 years as a reporter specializing in state government finances, analyzing such topics as income tax equity, waste in government and the complex funding systems behind Connecticut’s transportation and social services networks. He has been the state finances reporter at CT Mirror since it launched in 2010. Prior to joining CT Mirror Keith was State Capitol bureau chief for The Journal Inquirer of Manchester, a reporter for the Day of New London, and a former contributing writer to The New York Times. Keith is a graduate of and a former journalism instructor at the University of Connecticut.

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