Author Archives: afscme

Rethinking Multiemployer Pensions: A Cash Balance Solution

Source: Samuel S. Stanley, Journal of Pension Benefits, Vol. 26, No. 1, Autumn 2018
(subscription required)

Multiemployer pension plans are a very important part of compensation for millions of union workers. Unfortunately, many of these plans are failing to achieve their most basic objectives. But now a creative and unique new approach exists —a “Cash Balance Solution” —which offers a new way to address and to solve these plans’ financial, human resources, and business-related issues.

Declines in Child Poverty Continue in 2017; Overall Rate Still Above Pre-Recession Level

Source: Jessica Carson, Andrew Schaefer, Beth Mattingly, Carsey School of Public Policy at the University of New Hampshire, Data Snapshot, September 13, 2018

From the summary:
The official poverty measure indicates that child poverty declined by 1.1 percentage points between 2016 and 2017, according to analyses of the latest American Community Survey data released today. By 2017, child poverty across the nation was still 0.4 percentage point higher than before the Great Recession. Child poverty remained higher in cities and rural places than in the suburbs. For the first time, rates in cities dipped below the pre-recession level, although poverty is still slightly higher in rural and suburban places than in 2007.

Key Findings:
For the first time, rates in cities dipped below the pre-recession level, although poverty is still slightly higher in rural and suburban places than in 2007.

Income data from the Census may not tell full story on middle-class trends

Source: Gary Burtless and Christopher Pulliam, Brookings Institution, Up Front, September 17, 2018

…. The resulting news stories deserve our attention, but it is important to keep a vital question in mind: Does the CPS give us an accurate picture of household incomes?

In many recent years, the answer has been “No.” Compared to the national income and product accounts (NIPA) produced by the Bureau of Economic Analysis (BEA), the CPS often gives us a strikingly different picture of the recent trend in household income. ….

Towns Pick Up the Tab for U.S. Forest Service Staff

Source: Sophie Quinton, Stateline, September 19, 2018

….The visitor boom — while great for the local economy — is putting a strain on the public lands that are, ultimately, the reason people vacation, day-trip and retire to the Vail Valley. The cash-strapped U.S. Forest Service isn’t equipped to handle the more than 12 million people who now come to the 2.3-million-acre White River National Forest each year.

So, this year, Vail and other Eagle County governments are planning to set aside as much as $120,000 to pay for Forest Service employees to monitor trails and campgrounds and enforce backcountry rules next summer.

Communities across the country are facing similar challenges as more people visit public lands, outdoor recreation becomes more important to rural growth, and federal land managers struggle with tight budgets. The growth in tourism and population has led local governments to set aside tax dollars for a purpose they might never have considered before: boosting federal agencies. ….

City Fiscal Conditions 2018

Source: Christiana McFarland, Michael A. Pagano, National League of Cities, 2018

From the summary:
The 2018 City Fiscal Conditions survey indicates that slightly more finance officers than last year are optimistic about the fiscal capacity of their cities. However, the level of optimism is still far below recent years. Furthermore, tax revenue growth is experiencing a year-over-year slowdown, with the growth in service costs and other expenditures outpacing it. Taken together, the survey results suggest that cities are approaching the limits of fiscal expansion.

– Finance officers from the smallest cities are least likely to report that their cities are better able to meet the fiscal needs of their communities this year over last (63%). Meanwhile, finance officers from cities in the South are most likely to report feeling confident this year (81%).

– General fund expenditures are outpacing revenues, a trend anticipated to continue into next year. Although revenues are not in decline, they grew only 1.25 percent in FY 2017, and are expected to stagnate in FY 2018. Expenditures grew 2.16 percent in FY 2017, with growth for FY 2018 budgeted at 1.97 percent.

– All major tax sources grew slower in FY 2017 than in FY 2016, and all are expected to grow less than one percent in FY 2018. In FY 2017:
– Property tax revenues grew 2.6 percent, compared to 4.3 percent in FY 2016
– Sales tax revenues grew 1.8 percent, compared to 3.7 percent in FY 2016
– Income tax revenues grew 1.3 percent, compared to 2.4 percent in FY 2016

– Cities continue to rely on the same revenue generating actions as they have in the past, namely increasing service fee prices (41%) and property tax rates (28%). This year, fewer cities are instituting new types of fees (18 percent this year versus 26 percent last year).

– Employee wages (88%), public safety (78%) and infrastructure (71%) are the most common areas for which cities increased spending. Fewer cities this year are contracting or privatizing city services and more are increasing spending on personnel and workforce expansion.

– By and large, it is too soon to tell specifically how provisions of the Federal Tax Cuts and Jobs Act of 2017 will impact city finances, except for advance refunding bonds. Thirty-five percent of city finance officers are already seeing negative fiscal impacts associated with the elimination of tax-exempt advance refunding bonds. Sixty one percent report that the loss of this fiscal tool will have negative impacts on future fiscal health.

These trends come at a time when cities have not yet regained losses from the Great Recession and face uncertainty from federal and state partners. Despite these challenges, cities continue to balance their budgets, remain resilient and serve as engines of national economic growth.

The Impact of Job Expectations, Workload, and Autonomy on Work-Related Stress Among Prison Wardens in the United States

Source: Mara Schiff, Leslie Leip, Criminal Justice and Behavior, Online First, First Published September 28, 2018
(subscription required)

From the abstract:
Prison wardens manage both external pressures and internal challenges that affect work-related stress. Using data from a national survey of prison wardens, we examined the impact of conflicting job expectations, workload, and job autonomy on work-related stress among prison wardens. The ordered logistic regression results showed a significant and positive relationship between conflicting job expectations and work-related stress. The results also showed a significant and positive relationship between unmanageable workloads and stress on the job. We found a negative and significant relationship between job autonomy and work-related stress, though the relationship was relatively weak. The importance of this study lies in its ability to help isolate factors that affect job stress among prison wardens, which in turn may produce better organizational support, management, and human resources policy to improve conditions for prison wardens, staff, and inmates.

The Path to Performance Rewards: Perceptions Among Federal Employees on the Promise of Performance Appraisal

Source: Dennis M. Daley, Compensation & Benefits Review, First published online: August 24, 2018
(subscription required)

From the abstract:
Performance rewards are designed to incentivize individuals to obtain productivity. The performance appraisal process represents the organization’s efforts to introduce a formal plan alignment directing individual efforts. Performance appraisal techniques, for example, instrument, accountability, individual goals and priorities and training and development, should be perceived by federal employees as influencing the obtainment of organizational goals through extrinsic rewards. Using data from the 2013 Federal Employee Viewpoint Survey, regression analyses on perceptions of performance rewards are conducted with the performance appraisal process (appraisal fairness and accuracy, accountability for results, designated goals and priorities, feedback and training and development). The performance appraisal fairness and accuracy feedback and training demonstrate moderate effects.

What You Should Know: EEOC Leads the Way in Preventing Workplace Harassment

Source: U.S. Equal Employment Opportunity Commission (EEOC), 2018

From the press release:
The U.S. Equal Employment Opportunity Commission (EEOC) announced preliminary FY 2018 sexual harassment data today – highlighting its significant work this past fiscal year to address the pervasive problem of workplace harassment. What You Should Know: EEOC Leads the Way in Preventing Workplace Harassment recognizes key milestones of the agency to actively enforce the law, to educate and train workers and employers, and to share its expertise on new solutions to reduce harassing conduct in the workplace. ….

Based on preliminary data, in FY 2018:

– The EEOC filed 66 harassment lawsuits, including 41 that included allegations of sexual harassment. That reflects more than a 50 percent increase in suits challenging sexual harassment over fiscal year 2017.
– In addition, charges filed with the EEOC alleging sexual harassment increased by more than 12 percent from fiscal year 2017.
– Overall, the EEOC recovered nearly $70 million for the victims of sexual harassment through litigation and administrative enforcement in FY 2018, up from $47.5 million in FY 2017.

The promise of free college (and its potential pitfalls)

Source: Douglas Harris, Raquel Farmer-Hinton, Debbie Kim, John B. Diamond, Tangela Blakely Reavis, Kelly Krupa Rifelj, Hilary Lustick, and Bradley R. Carl, Brookings Institution, September 2018

From the summary:
….This study examines one of the first randomized control trials of a program similar to many free college and promise scholarship proposals. The Degree Project was launched in Milwaukee Public Schools (MPS) in 2011. Students in 18 randomly selected high schools were promised up to $12,000 to pay for college, at essentially any in-state institution. These funds were sufficient to cover all tuition and fees at the local two-year college—making it a form of free or debt-free college. The funds could also be used to attend four-year colleges, covering more than one year of tuition, and fees. To receive the funds, students had to graduate on time from an MPS high school with at least a 2.5 cumulative GPA and a 90 percent class attendance rate, and fill out the Free Application for Federal Student Aid (FAFSA).

The Degree Project had some impact on students’ motivation, college expectations, and steps toward college, such as applying to more colleges and FAFSA completion. However, it had no effect on the performance measures and no effect on whether students went directly on to college. The most recent evidence does suggest that the scholarship may have slightly increased persistence and graduation in two-year colleges, though not in four-year colleges. We are continuing to track these effects; however, it seems clear at this point that many of the potential benefits, during and just after high school, did not emerge.

Through additional quantitative and qualitative evidence, we identify three related reasons why the effects were not more substantial: (a) the performance requirements greatly reduced the number of students who could plausibly receive the funds; (b) the performance requirements, combined with the temporary, small-scale design, meant that the program did not have the catalyzing effect on high schools that otherwise similar programs have seen; and (c) the context in Milwaukee—particularly, the very low level of academic performance and lack of counselor resources— may have been particularly ill-suited to make a performance-based aid program work well.

In other words, this version of free college did not live up its potential in part because of the way it was designed. While we plan to continue studying the program in future years and more effects may emerge, our first decade of work suggests two key lessons:

1. Avoid performance requirements. Merit or performance requirements, though popular, seem to limit both the effectiveness and equity of financial aid. When students received The Degree Project funds, it increased their attendance and graduation somewhat, but the performance requirements meant that very few actually received any funding. So why have the requirements? The intent is to support and reward students who have the best chance to succeed in college, and therefore the smallest likelihood of dropping out with debt, but the result is essentially the opposite. Under almost any plausible assumptions, performance requirements reduce the number of college graduates more than they reduce the number who drop out with debt. A second possible argument for performance requirements is that they may induce students to work harder and become more academically prepared for college, but we find no evidence of this either. The main effect of performance requirements, then, is to provide more funds to higher-income families, which only reinforces existing disparities.

2. Use free college and other forms of financial aid to catalyze changes in high schools. Policy debates about financial aid tend to focus narrowly on how it makes college cheaper for the individual students who receive the funds. But to fully realize the effects of aid, it has to be leveraged to improve the college-going cultures of high schools. MPS high schools were not set up to make college a viable option for most students. The schools did not make a college prep curriculum or structured supports broadly available, or expect most students to attend college. The Degree Project, with its narrow focus on giving money to individual students, was not designed to address this larger problem and, as a result, it did not have the catalyzing effect on high schools that has been observed in other free college programs. The performance requirements made matters worse; by significantly narrowing the share of students who could benefit from the program, the requirements reduced the potential for positive “spillover effects” across students and educators. In short, for free college to fulfill its potential, policymakers need to leverage it to change high schools…..