Md. federal workers face twin assault on wallets Pay freeze, tax increases looming

SSA, state transit projects due funds CLINTON'S ECONOMIC PROGRAM

February 18, 1993|By John Fairhall | John Fairhall,Washington Bureau Nelson Schwartz, Karen Hosler, Peter Jensen and David Michael Ettlin contributed to this article.

WASHINGTON -- Although it contains $57 million for Maryland transportation projects and $300 million for the Woodlawn-based Social Security Administration, President Clinton's economic program is a setback for the more than 300,000 federal workers in Maryland who would have their pay frozen.

Another detriment for Maryland is the president's proposal to overhaul the space station program, which could cost the jobs of some of the 125 Marylanders involved in the project.

Leaders of federal employee unions reacted angrily to the proposal to freeze the pay of civilian and military workers, cancel a 1994 raise and reduce annual raises in the following three years.

"You're not going to balance the budget on the backs of federal workers," said John Sturdivant, president of the American Federation of Government Employees. "We're definitely going to fight."

And some Maryland lawmakers, notably Democratic Sen. Paul S. Sarbanes and Rep. Steny H. Hoyer, a Democrat, said they would oppose the freeze and seek other means of saving money.

Mr. Hoyer would not rise for the standing ovation that greeted Mr. Clinton's declaration of a freeze and said later, "The freeze on federal pay obviously gives me problems."

"It's not writ in stone," Mr. Sarbanes said of the president's program. "It is not fair to the federal employees."

Union officials were happier with the Social Security news. The agency would use the money this year to speed up processing of disability claims, which are backlogged. Mr. Clinton also proposed spending $1 billion, from 1994 through 1997, for an "automation investment fund to improve service and productivity."

The state also would benefit from the transportation funds, $44.9 million of which would go to highways; the other $12.1 million would go to mass transit.

But for federal workers, the news was all bad. Mr. Sturdivant, who was participating in an AFL-CIO leadership meeting in Florida, said in a telephone interview that those workers are being pinched twice, "as taxpayers getting hit with increased taxes and getting hit again on our standard of living with a pay freeze."

There are 133,000 federal civilian workers employed in Maryland and tens of thousands more who live in the state but work in Washington or Virginia. There are also 33,000 active-duty members of the armed services in Maryland.

Government workers received a 3.2 percent raise in January, according to the Office of Personnel Management, and were scheduled to receive a 2.2 percent raise in 1994. Under a law signed in 1990, annual raises are based on an employment cost index, a measure of wages and salaries in the private sector.

The law pegs annual raises to the index, minus half a percentage point. Mr. Clinton is proposing that, after canceling the raise in 1994, increases from 1995 through 1997 be capped at a full point below the index.

Although federal workers account for many votes in Maryland, some lawmakers were withholding immediate criticism of the freeze.

"My feeling on this specific provision, as with many other specific provisions that are controversial and need to be explained, is that I want to look at the total package," said Rep. Benjamin L. Cardin, a Baltimore Democrat.

Rep. Constance A. Morella, a Republican from Montgomery County who is a champion of federal workers' interests, said she needed to learn more about the freeze and reduction in raises.

Rep. Helen D. Bentley, a Baltimore County Republican, said, "I've always maintained if you have to freeze, you have to freeze everything: all budgets, all costs; that means none of the new or expanded programs he talked about."

Federal workers' unions and Maryland lawmakers were much happier about Mr. Clinton's proposal to provide Social Security with $302 million more this year. The agency has 700,000 disability claims waiting to be processed, and 2 million new ones come in every year.

But the unions were disappointed that the money, earmarked for equipment and overtime -- mainly for state workers who help Social Security process disability claims -- was not also designated to hire more staff members.

The Social Security work force was cut from about 80,000 to 65,000 during the 1980s. The agency has 14,000 employees in the Baltimore area. The funds recommended by Mr. Clinton would be spread over the agency's operations nationwide.

The president's plan for the space station could threaten some of the 125 Maryland jobs connected with the project, according to the National Aeronautics and Space Administration. About $14 million is being spent in the state this year on station-related work.

Nearly 4,000 Marylanders work for NASA at the Goddard Space Flight Center in Greenbelt. The communications and tele-robotics portions of the space station are being managed at the Goddard facility, a spokesmen for NASA said.

First proposed by President Ronald Reagan in 1984, the space station originally was to cost $8 billion. Cost estimates have ballooned to $30 billion, however, amid increasing reports of waste and mismanagement in recent years.

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