Proposal 3 costs debated

By Gary Heinlein

LANSING - Business groups are determined to shoot down a ballot proposal that would give state workers an added tool in contract negotiations: binding arbitration.

Critics, led by the Michigan Chamber of Commerce, say the system isn’t broken and doesn’t need fixing. Binding arbitration would add $30 million to $60 million a year to the costs of state government and complicate contract settlements, they say.

"The state employs about 60,000 workers, and you’re talking about billions in wages and benefits at a time when the state budget is expected to be tight for two or three more years," said analyst Paul Kersey of the Mackinac Center for Public Policy, a conservative research center in Midland.

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Proposal backers say the current setup lets the state change contracts and work rules without workers’ consent. Arbitration wouldn’t cost as much as naysayers estimate, they add.

"This isn’t about pay. State workers feel they’re well compensated," said Bill Castanier, a past state employee who represents proponents. "It’s about conditions of employment."

State workers are prohibited from striking. Under Proposal 3, however, they’d get a constitutional guarantee of binding arbitration to break impasses over wages or job conditions. State troopers have that right now; other state employees don’t.

Kersey said state employees’ pay and fringe benefits already exceed those of comparable private sector workers.

Castanier said without binding arbitration, state workers won’t win the right to challenge suspicious practices or question service contracts with outside firms, which total $3 billion.

You can reach Gary Heinlein at (517) 371-3660 or

This story appeared October 13, 2002. Copyright 2002 The Detroit News.