Revenue shortfalls, not bargaining, drive states' deficits

Analysis reveals that states that don’t bargain with public workers also face budget problems.

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By Joanne Huist Smith, Staff Writer Updated 12:00 PM Monday, February 28, 2011

Ohio isn’t likely to solve its budget crisis by limiting collective bargaining rights for public employees, based on the experience of states where it is illegal for them to bargain.

North Carolina, Texas and Virginia have laws prohibiting collective bargaining. Georgia and South Carolina have no laws either way.

A report on state fiscal conditions by Ohio Policy Matters found those states, like Ohio, have faced daunting financial challenges in recent years.

In 2010, revenue shortfalls in states without collective bargaining averaged about 24.8 percent of their budgets and for states that allow bargaining for some or all public employees the shortfall was 23 percent.

“Since the recession, just about every state has had shortfalls. The reason that has happened is that the bottom fell out of their revenue,” said Jon Shure, deputy director of the Center on Budget and Policy Priorities’ State Fiscal Project. “In terms of the severity of the crisis, there is no difference between states that do or do not have collective bargaining.”

A Virginia Supreme Court decision outlawed collective bargaining for public employees in 1977. A significant decline in union membership followed.

“I think you will see that happen in Ohio, unless the unions can use this to mobilize,” said Ann Hodges, a law professor at the University of Richmond in Virginia.

But, Terry Ryan, vice president for Ohio Programs & Policy at the Thomas B. Fordham Institute, called these “brutal financial times” with education layoffs looming.

He believes changes to Ohio’s collective bargaining law would ensure the best employees — not just the ones with the most seniority — keep their jobs.

“We want to give officials flexibility to make cuts that do the least amount of harm,” he said.

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