A significant bloc of Democratic state senators is opposing Governor Charlie Baker’s plan to entice thousands of state workers to retire early in an effort to save Massachusetts money.
The senators, who range from conservative to liberal, said the pension-sweetening bill is fiscally irresponsible — creating additional pension costs for the state in future years — and they worry the plan could gut some state agencies to the point of hurting services.
“I can’t support kicking the can down the road like this. No way. No way,” said William N. Brownsberger of Belmont in a joint Globe interview this week with six other senators.
Michael J. Rodrigues of Westport added, “I don’t see how these agencies can provide the type of services that we expect of our government with these staff reductions.”
The senators’ deep discomfort with the plan, which unanimously passed the Democratic-controlled House last month, appears to have already slowed the bill’s movement into law. And it raises questions about the prospect of its time-sensitive passage in the 40-member Democrat-controlled Senate. Indeed, the Senate had intended to take the bill up Wednesday, but when it might come up for a vote is now in limbo.
Baker chief of staff Steven Kadish and budget chief Kristen Lepore are scheduled to respond to senators’ concerns at a meeting on Wednesday, which may include discussion of alternative ideas, including an extended hiring freeze floated by Brownsberger.
Baker, a Republican, proposed the early retirement incentive program as part of his plan to bridge a projected $1.8 billion shortfall in the fiscal year that begins July 1.
The program is aimed at a certain category of employees working in the executive department — a broad swath of the bureaucracy under control of the governor or his Cabinet, from the Department of Transportation to the Department of Developmental Services. The administration estimates 4,500 employees would take advantage of the early retirement deal, which boosts their pensions, to a certain limit, by crediting them with up to five additional years of age or work.
The administration has said the plan — after accounting for costs such as paying out vacation days, taking on a chunk of the additional pension liability, and hiring to fill a fraction of the newly-vacant positions — would save the state more than $170 million in the new fiscal year. That estimate is premised on the bill becoming law soon and a big number of employees leaving the state payroll by June 30.
Key to the savings is a cap on filling those empty positions: Rehires are limited to 20 percent of the direct payroll savings. Lepore, the budget chief, has said within that overall cap, there would be flexibility to make more rehires in some agencies and fewer in others.
And she has noted that in previously implemented early retirement plans, thousands have taken the deal and state government continued to function.
But the seven senators — Brownsberger, Rodrigues, Barbara L’Italien of Andover, John F. Keenan of Quincy, Kenneth J. Donnelly of Arlington, Michael J. Barrett of Lexington, and Sonia Chang-Diaz of Boston — expressed deep concern that the departures, even after the rehires, would leave some parts of state government unable to perform properly.
Donnelly worried that some agencies, including one that supports individuals with intellectual disabilities and one that enforces tax laws, would be particularly hard hit and “are not going to be able to provide the services we really need for those people.”
Other senators mentioned concerns that a big exodus of employees from the transportation department could hamper road and bridge work.
The bill offers the early retirement package only to certain workers who are eligible to receive a state pension — those who are 55 or older and have reached 10 years of service, or have achieved 20 years of service. They also have to meet other eligibility requirements.
According to Brownsberger, some agencies would have more than a third of their employees eligible for early retirement. There is no way to know exactly how many people would take the deal, he said, decrying that unpredictability.
The senators also expressed apprehension about the additional pension liability the program would incur and unhappiness with the idea of signing up Massachusetts for a long-term cost to bank short-term savings.
Keenan, a former executive director of the Norfolk County retirement system, said by one estimate, a 62-year-old who had 29 years of service and took the early retirement deal would see an annual boost in his or her retirement allowance of about $9,300. He said over the course of the rest of that example employee’s life, it adds up to a lot of money.
Barrett said the early retirement plan was “an excessively generous deal that will cost us in terms of budgets for years.”
The administration projects the early retirement program would incur $48.7 million in additional pension liability each year for the next 15 fiscal years.
But aides say they have been financially prudent in their calculations. The pension costs, they say, would be paid for by the savings from having fewer state workers.
“The proposal that we made fully funds the pension contribution for the next 15 years,” Baker said this week.
But voters have, so far, given Baker only four years, and there is no guarantee of what future governors might do. If a big chunk of vacant positions are refilled, the savings go away.
Some of the seven senators floated the idea of an extended hiring freeze instead of the early retirement program. But what they did not offer was a specific alternative path to the amount of money the early retirement program is projected to save in the new fiscal year.
A top Baker administration budget aide said, one way or another, the budget needs to be balanced, which means finding other savings if the Senate doesn’t like the early retirement plan.
Joshua Miller can be reached at email@example.com. Follow him on Twitter @jm_bos.