When California ended up in the disgraceful position of being $60 billion in the hole, the Governor wanted to stop some of the bleeding by ordering twice-monthly furloughs for 200,000 state workers. But instead of saving money by shutting down the courts or DMV offices, the furlough plan could be creating another big economic mess.
Here's why. Many workers are using furloughs instead of vacation days -- meaning they're accumulating more vacation time than usual. The cash value of that banked vacation time increases with raises or promotions. On top of that, the Sacramento Bee reported that the number of vacation hours used by state employees fell 31 percent from 2008 too 2009, according to a study they did with the state controller.
CaliforniaWatch.org backs up the Bee's report: many of their sources expressed concerns that furloughs were causing people to use less vacation than ever, potentially putting the state on the hook for hundreds of millions of dollars in liabilities -- which could offset furlough savings.
Administration spokesman Aaron McLear tells the Bee that the increased vacation payouts "would be spreadout over decades, " so they won't hit the state all at once.
But then each department must anticipate the expenses in their annual budget, or else they'd have to find it from somewhere else. Translation: Make cuts elsewhere.