Dear ASEA Member:

The CNC last night, Thursday, April 1, at approximately 6:30 p.m. signed a tentative agreement with the State. It is clearly not the contract the CNC wanted but after 4 days of federal mediation it became quite obvious to the federal mediator and to the CNC that it was the best contract we were going to get out of this administration. Also, as you know Local 71 had signed a tentative agreement a couple of weeks ago and the SU signed a tentative agreement yesterday at about 3 in the afternoon. After that it was clear that the ball game was over.

The administration was adamant that all the contracts be held to a 6% increase over the life of the contracts. They did this based on a pure political position and not based on the economic situation of the State or the economic needs of our members and the members of other unions. I believe that the tentative agreement entered into by your CNC is a better overall contract than that obtained by the other unions because of our health insurance language. Below are the highlights of the Tentative Agreement:

Wages: Year 1: 1% increase, Years 2 & 3: 2% increases each year. (The other unions have 2, 2, 2 but we gain more in Health Insurance employer contribution.)

Health Insurance: The CNC was successful in maintaining our current contract language which will result in an increase in the employer contribution on July 1, 2010 of $185 per member per month (from the current contribution of $940 to $1125). Our language results in $37 per member per month more than the other union’s will receive—this equates to an approximate 1% increase greater than the other unions and is the reason the State held us to a 1% increase in wages in year 1. In addition, this increase contribution is pre-tax so it has an additional benefit. I expect the dollar increase that our formula will generate in year 2 will be an increase close to the year 1 increase so the value of our contract I believe significantly exceeds the 6% threshold the State desired. The Health Trust informed me yesterday that based on this there will not be an increase in the employee contribution for health insurance required on July 1, 2010 which is good news for our members.

Geographic Differential: There is no change in the geographic differential for any area in year 1. Beginning in year 2 the following major changes will occur: Juneau will receive a 2% geographic differential on July 1, 2011, and that will be increased to 5% on July 1, 2012. Fairbanks will move from 4% to 3% on July 1, 2011 (incumbents pay will be frozen at that time which means they will only see a 1% increase in wages instead of 2%), and Anchorage remains the base at 0% geographic differential. There are also changes in rural areas with the majority of the rural areas receiving an increase geographic differential in year 2. Delta Junction, Tok, Nenana, and Cantwell have a geographic differential decrease for new hires but incumbents will receive the current rate for the duration of the contract. Glennallen, Skagway, Yakutat, Haines, and Fort Yukon incumbents are also frozen but new hires will have a decreased geographic differential on July 1, 2011. For the most part all other rural areas will have an increase in their geographic differential effective July 1, 2011. The CNC will be providing a table showing the geographic differential adopted for each area at worksite meetings.

There were other minor changes in the contract but no area where we took a step back despite many attempts by the State to take away some of our provisions.

The monetary terms of the agreement are to be submitted by the administration to the legislature for approval this session. I am confident that the monetary terms will be approved and the money for the health insurance and the wage increase will be available for payment on July 1, 2010 assuming the membership ratifies the contract.

The CNC has taken the position of supporting ratification of the agreement.

The CNC will be preparing a statement of gains and losses and other information for distribution over the next couple of weeks. We will also be establishing worksite meetings to discuss the tentative agreement and establishing a schedule for the ratification vote in the near future.

Please contact a member of the CNC, business agent Bill Johnson, or me if you have any questions.

Jim Duncan
Business Manager