Furlough Fridays: Coming Back to Haunt Taxpayers

Many remember when in 2009 Governor Schwarzenegger announced that state workers would not come into work on one Friday a month in an effort to cure short-term budget ills.

From the LA Times:

SACRAMENTO — The decision to furlough state employees during the financial crises of recent years may have saved money in the short term but will leave a big bill down the road, the Legislature's budget advisors said Thursday.
The state will owe $1 billion extra to many workers when they retire or quit, for vacation time that went unused while they were being forced to take unpaid days off.
The furloughs were intended to save $5 billion from February 2009 to July 2013, effectively cutting workers' pay 5% to 14%. The $1 billion for unused vacation — some in excess of state accrual limits — will eat into those savings, according to a report by the nonpartisan Legislative Analyst's Office.
A spike in unused vacation time drove payouts to a historic $270 million during the 2011-12 fiscal year, two-thirds more than when the furloughs started. In June 2012, the average state employee had about 53 vacation days saved, 51% more than when Gov. Arnold Schwarzenegger first ordered forced absences in 2009.
Mike Genest, who worked as Schwarzenegger's finance director, said he wasn't surprised by Thursday's report. It was known that furloughs might simply delay some costs, he said, but they were the best option given the severity of the state's budget woes.
"It was a political judgment call," he said. "Some of us knew we were just borrowing money from the future."