Iowa gov, union back new pact; gov-elect objects

[Omaha Steve]

http://www.businessweek.com/ap/financialnews/D9JJG1A00....

By MIKE GLOVER

The state of Iowa and leaders of its largest union announced Friday that they reached a tentative agreement on a two-year contract that gives workers a 2 percent raise on July 1.

Republican leaders quickly criticized the deal with the American Federation of State, County and Municipal Employees, calling it irresponsible and estimating it would cost the state more than $100 million in the first year.

The contract still must be approved by the roughly 20,000-person union.

State spokesman Robert Bailey said the agreement calls for a 2 percent pay increase in July, followed by a 1 percent increase in January 2012, another 2 percent in July 2012, and a 1 percent increase in January 2013.

Democratic Gov. Chet Culver, who lost his re-election bid to Republican Terry Branstad, said state employees deserved the raise, in part because they agreed to furloughs and other moves last winter to deal with plunging tax revenues during the recession.

"They agreed to take unpaid furloughs and suspension of employer deferred compensation contributions in FY2010 so that the state could better adjust to economic conditions and lower revenues," Culver said in a statement. "These people are on the front lines of delivering vital services and information to the people of Iowa and deserve to be paid in accordance with their qualifications and efforts."

FULL story at link.