After months of negotiations driven by declining state tax receipts, Hawaii’s largest government employee union reached a tentative contract agreement with the administration of Gov. Linda Lingle, calling for 42 unpaid furlough days over the next two years.
Lingle initially sought to unilaterally impose a three-day-per-month furlough — for 36 days a year — but lost a court decision, in which the court ruled that any furloughs were subject to collective bargaining.
Threatening layoffs as an alternative, the administration went to the bargaining table, emerging Wednesday with an agreement for 18 furlough days in the current fiscal year and 24 in fiscal 2011. Union members still have to ratify the deal.
“The state is very pleased that we have reached a tentative agreement on a new contract with the Hawaii Government Employees Association,” Lingle said in a statement Wednesday. “We believe this contract is in the best interest of the state and its employees and we hope the employees will ratify the contract.”
The administration in September agreed to a contract with teachers that will close schools for 34 days over this school year and the next.
A sharp decline in tourism has hit Hawaii’s economy hard, but all three rating agencies affirmed their double-A level ratings on the state in advance of a $655 million general obligation bond deal that had been planned for this week.
Because of rising rates, the state and underwriter Merrill Lynch & Co. pulled the $632 million refunding component of the deal.
The state did price $32 million of general obligation tax-credit bonds as qualified school construction bonds, as well as $41 million of certificates of participation.