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IA-22-95
In Arbitration Between the Oregon State Police Officers Association and The State of Oregon. IA-22-95
 
This matter was heard in Salem, Oregon, on April 18 and 19, 1996. Voluminous evidence was submitted and lengthy post hearing briefs were mailed, following brief extensions, on about May 21, 1996. The State, with permission of the Association, submitted one brief correction and, on June 21, one brief supplemental submission.
 
Background to the Case
 
This case requires the Arbitrator to select either the "last, best" offer of the State of Oregon, Department of Police, or of the Oregon State Police Officers Association, thereby completing a collective bargaining agreement. The offers were submitted under relatively new and little tested amendments to the Oregon Public Employment Collective Bargaining Act. This Arbitrator has previously, and recently, discussed the new statutory criteria for interest arbitration and the relevant legislative history, in some detail.(1) There is no need to repeat that discussion in this case.
 
The flagship dispute between the parties concerns wages. The State proposes a two year wage freeze. The Association proposes two three percent raises for all employees and two additional two percent raises for Telecommunicators I and II.
 
The Association has proposed increasing the insurance contribution under the contract to cover the full costs of the Blue Cross Plan 3 Health and Dental and core life insurance. The State proposes a freeze on contributions that will require any increase in these costs to come from employee salary. Both the State and the Association have proposals related to uniforms. The State would not restrict the amount of the current allowance, but would require prior approval of purchases and insist that purchases be appropriate for the employee's work. The Association would expand the allowance for certain footwear.
 
The State has proposed to change the status quo by elimination of the "outpost itinerary" provision of the contract. The current provision provides for flexible scheduling and premium pay of troopers assigned to "outposts." The Association proposes to maintain the current language and notes that the State does not propose to alter the residency requirement applicable to troopers assigned to outposts.
 
The Association proposes reimbursement for parking for employees at the Portland Crime Lab. It also proposes a change in methodology in premium pay for pilots. The Association proposes to amend language on compensatory time to confirm to its view of the requirements of the Fair Labor Standards Act and the situation interest arbitration. On each point, the State before the last resists the proposed change.
 
The parties submitted differing proposals for responding to Ballot Measure 8. Since that Measure has been declared unconstitutional, differences in those proposals appear moot.
 
Discussion and Conclusion
 
The Arbitrator will first consider the parties' general arguments or disagreements about issues of interpretation or application of the law, then summarize the proposals, then consider the merits of the proposals in light of the statutory criteria, and, finally, attempt to balance all of the resulting conclusions.
 
I. DISPUTES OVER THE MEANING OF THE STATUTORY CRITERIA
 
A. The Interest and Welfare of the Public.
 
The statute now requires that if the "interest and welfare of the public" dictates acceptance of one offer, the Arbitrator must approve that offer without further inquiry. Both parties here argue that the "interest and welfare of the public," for various reasons, dictates that the Arbitrator rule in its favor.
 
The State is certainly correct in arguing that one cannot merely define this highest priority by reference to matters the statute -makes secondary. It follows that to the extent either the Association or the State make such arguments as directly related to "interest and welfare of the public," they are better considered under the more specific statutory criteria. Thus, for example, the Association argues that retention of high quality personnel is in the "interest and welfare of the public." This is certainly true. It is also fully accounted for under the secondary retention criteria in the statute. The State makes a similar argument regarding the possibility of a reduction in force. This is a serious matter. It is also a concern for ability to pay and retention of employees; once again, secondary statutory criteria.
 
The State is also correct in arguing that the "interest and welfare of the public" must have some meaning and application beyond being a general guide to use of the secondary criteria. Otherwise it will be a hortatory primary criterium, with no real operative effective.(2) The Arbitrator also accepts the State's argument that "the interest and welfare of the public was made the first criterium for decision because it is impossible to "argue that the public interest should not be the first priority." After SB 750 (LERC Monograph No. 14 1996) 71. However, is impossible to make this argument, in part, because the te "interest and welfare of the public" is inherently debateable; everyone can agree on giving this term priority in part because the term is broad and malleable -- that is, everyone can disagree about precisely what it means.
 
The Arbitrator continues to believe that this term of the statute serves two primary purposes. First, it reminds and compels arbitrators to respect binding decisions already taken by public bodies within their distinctive powers. To the extent a proposal or argument rests on disputing what, for example, the legislature has chosen to expend versus what it has chosen to rebate to taxpayers, or similar actions outside the jurisdiction of arbitration, this is simply not a matter for arbitrators. Proposals or arguments premised on disputing such actions are outside the bounds of "the interest and welfare of the public." No such issue is presented by the proposals here.
 
Second, this provision allows an arbitrator to firmly disapprove of a proposal that is clearly outside the bounds of reasonableness, given identifiable public interests. Both parties, naturally, argue that the other has exceeded these generous bounds. Those arguments will be reviewed below.
 
B. Comparability
 
The parties are at odds over almost every issue related to comparability. Comparability, for State employees, involves, under the new statute, two potential sets of comparisons. First, there can be comparison with employees of Oregon local governments who are "performing similar services . . . in comparable communities." O.R.S. § 243.746(4)(e). Second, there can be comparison with "other states. O.R.S. § 243-746(4)(e)(C). The issues here include what comparisons are most important; which local governments and states should be used for comparison; how comparisons should be conducted; and what employee classifications or ranks provide a benchmark for comparison.
 
1. Importance of Comparisons
 
Both parties have argued that in-state comparisons are secondary to this case. The Association has argued that it is "virtually impossible" to compare the complex of operations of the Oregon State Police with "City or county police employees." However, the Association argues that city and county pay remains relevant especially in evaluating the statutory criteria of retention of employees. That is, the State should not become a training ground for local police departments. Similarly, the State has argued that the scope of state police department activities in other States is more comparable to work of the Oregon State Police than any local unit. Thus, the parties basically agree (and the Arbitrator happily accepts) that local comparisons are of secondary importance for this unit of state employees.(3)
 
2. Comparable States
 
The State pleads here, as it is apparently doing in every case, that California should be eliminated from any comparison For the reasons that follow, the Arbitrator disagrees. First, it is clear that California has been repeatedly used by the State, various unions, and many arbitrators as a basis for comparison. While such past practices and awards are not written in stone, there must be some persuasive reason to depart from such a uniform course.
 
Second, the State argues that one such reason is population. As it sees it, population has become the touchstone of comparison for most public employees and by parity of reasoning should be the touchstone of comparison here. This plausible argument is contrary to the statute. The statute provides that in general, comparison is limited to jurisdictions of comparable population in Oregon. O.R.S. § 243.746(4)(e). Then, "[n]otwithstanding" this general rule, for larger population cities and counties comparison to similarly sized cities or counties outside Oregon is authorized. O.R.S. § 243.746(4)(e)(A) & (B). Finally -- and once again "[n]otwithstanding" the general rule -- for "the State of Oregon,'comparable' includes comparison to other states." O.R.S. § 243.746(4) (e)(C) . In marked contrast to the preceding sections of the statute, no mention of population occurs in subsection (C).The appropriate conclusion is that the legislature was perfectly capable of using the words "comparable population" or "same or nearest population range" when it wished to. It could have used such terms to qualify the term "other states," as it did in every preceding section of the statute. It choose not to do so.(4) The Arbitrator will not read into the statute terms that were pointedly not used by the legislature. In short, population may well have become, as commentators have suggested, the sole criterion for comparison for local jurisdictions; this is not true of state-to- state comparisons.
 
Second, the State argues that California should be excluded because it is not part of a demonstrable "labor market" with Oregon. This argument proves far too much. No other state, taken as a whole, is part of a "labor market" with Oregon. Certain border regions undoubtedly have labor markets that run across state boundaries, but "states," as such, are not part of an "Oregon"labor market. As the State recognizes in other parts of its argument, comparison to other states is not based in a labor market rationale Thus, a labor market rationale is not appropriate as a basis for excluding any one state.
 
Third, the State argues that California has a tendency to skew or distort comparisons, both by virtue of the use of weighted averages and because its salaries are inflated relative to Oregon.(5) This objection, however, goes to how figures from California should be used or viewed, not to whether those figures should be entirely excluded.
 
Given the forcefulness with which the State makes these arguments, it may be well to suggest why comparison with California remains appropriate. First, it was certainly appropriate for the legislature to allow comparison with other states regardless of labor market issues. states are a unique, sovereign entity within our federal system and an "apples to apples" comparison for state employees requires, at least arguably, comparison with other states. Second, that other states have or any particular state has limited direct impact on employment in Oregon does not mean there is no potential impact. Other states remain a legitimate gauge of what Oregon should be doing in order to avoid losing valuable employees or being perceived as treating such employees badly.
 
Third, California clearly has demographic similarities to Oregon (which have been catalogued by previous arbitrators and need not be repeated in detail here). Briefly, these states share a Pacific coastline, Interstate highway, mountain ranges and a lengthy land border. Fourth, California is a source of recruits. one set of figures provided by the State shows 1,373 in-state applications to the Oregon State Police. California is the second-highest source of this cohort of applicants, at 230.(6) Finally, and perhaps most importantly, all of the State's legitimate objections can be fully cured through attention to the method of comparison.
 
3. Comparison with Oregon Local Governments
 
This case involves, obviously, employees dispersed around the state of Oregon. Some functions are centralized or concentrated in the most populous areas of the state. Others are no doubt over-represented in rural areas. The "community" these employees serve is, most plausibly, Oregon as a whole. As a result, determining exactly what local government employees are "incomparable communities" relative to state police officers is" in the abstract, something of a conundrum. As in the previous case heard by this Arbitrator, it appears this section of the statute was drafted with local governments primarily in mind, leaving it with an awkward application to various groups of State employees. This contributes to making this comparison secondary.
 
The Association looks for comparison to the largest and most urbanized areas of the state. The State looks to a list of eleven jurisdictions representing every geographic region of the state. Again, the State I s argument has a certain logical appeal. Again, the Arbitrator has considered, first, whether the statute favors one approach over the other. The statute states the appropriate comparison is with comparable communities and then defines those comparable communities to be (with three exceptions) "limited to communities of the same or nearest population range within Oregon." O.R.S. § 243.746(4)(e). Clearly, this is mandatory language. Further, the only exception applicable to the state concerns other states, not internal comparisons. once again, the Arbitrator suspects this was drafted with local governments mostly in mind and it is certainly counterintuitive to describe local communities within Oregon as being of "the same or nearest population" of the State as a whole. There may be other readings that can be given to this statute, particularly when a State government activity takes place within a single local community. For the State Police Department, however, this appears to be the most plausible reading of the statutory language.
 
The largest population cities and counties are of the "nearest" population to the State as a whole. The Arbitrator cannot say this plain reading of the statute is absurd.(7) Thus, the Arbitrator (reluctantly, in view of the difficulties in applying the statute) agrees with the Association that the largest urban counties and the City of Portland are the internal comparisons dictated by statute. The State's arguments for a different -- or at least more clearly defined -- approach to in-state comparability should be addressed to the legislature.
 
3. Methods of Comparison
 
The State makes two primary arguments regarding comparison with other states. First, it insists that averages weighted by population or number of employees are inappropriate. The Arbitrator agrees. The rationale for using weighted averages rests in labor market considerations. Since state-to-state comparison goes beyond, and is not based in, the existence of a common labor market, use of a weighted average is inapt. In contrast, the State as much as admits that a weighted average, by number of employees, may be appropriate in "labor market" calculation. Since internal comparisons must at least overlap with labor markets relevant to this state wide unit, averages weighted by number of employees are appropriate in that comparison.
 
Second, the state suggests that either a simple average or use of "leveled" data is the appropriate means of comparison between states. The Arbitrator partially agrees. It appears to the Arbitrator that three different, but related, methods of comparison should all be used and are useful as checks on each other. First, a simple average of the f our states is an appropriate initial basis for comparison though it obviously risks distortion if any of the four states is an outlier. Second, the State has argued that California figures are high and the Association has argued that Idaho, Nevada, and Washington salaries are (for a variety of reasons) low.(8) Both arguments appear to have merit and similar arguments seem to have caused Arbitrator Runkel to find that Oregon salaries should be somewhat above the simple average. This is one way of correcting for one arguably high and three arguably low comparisons. However, it does not take account of the degree to which these jurisdictions are either high or low. A more precise way of accounting for possible distortion in the simple average is to compare by ranking the five states, with the expectation that Oregon will rank above Idaho, Nevada and Washington, but below California.
 
Finally, the State proposes use of leveled data as a secondary means of comparison. Leveled figures are derived from standardized publications and attempt to correct for variations in local cost of living. In other words, if a given standard of living requires significantly more in salary in Manhattan than it does in Portland, then it is inappropriate to do a dollar-for-dollar comparison of a Manhattan salary to a Portland salary. Reliable leveled figures would represent the state of the art in salary comparison. Such figures would also completely resolve the State's objections to use of California data. The Arbitrator recognizes that this is a very innovative proposal and that the Association has reasonable doubts about the reliability of the methodology and figures. However, used in the limited manner the State suggests -- that is, merely as a secondary basis for comparison -- the Arbitrator believes leveled
 
figures are appropriate.
 
4. Benchmark Employees
 
The Association argues that the traditional benchmark in this unit is the employee at the five year level. The State argues vigorously for another change in the traditional approach, asserting that the ten year employee is the proper basis for comparison. As noted by other arbitrators, there is no science in picking such benchmarks. However, the Arbitrator finds it unnecessary to resolve this dispute by selecting a single benchmark. As the facts discussed below will show, comparison at multiple benchmarks and other factors point in a single direction.
 
II. APPLICATION OF THE STATUTORY CRITERIA TO THE PROPOSALS
 
A. The Public Interest and Welfare
 
Despite the various efforts each party has made to portray the other's proposal as ridiculous, the Arbitrator finds, for reasons discussed in more detail below, that both proposals have well-reasoned features and are based in evidence. Indeed, the arguments in this case reminded the Arbitrator of Arbitrator Shulman's famous complaint about arguments on past practice: "Each remembers details the other does not; each is surprised at the other's perversity; and both forget or omit importance circumstances. . . producing immersion in a bog of contradictions, fragments, doubts, and one-sided views."(9)
 
Despite their low opinion of each others' cases, both parties here presented credible arguments and evidence to support their proposals. Thus, the Arbitrator finds either proposal would serve "the public interest and welfare" and that this case must be determined under the statute's secondary criteria.
 
B. Financial Ability
 
In the AOCE Arbitration, this Arbitrator found that the State demonstrated "its finances are exceptionally tight and its reasonable reserves are under pressure and at risk . ." As a result this factor was the one "most strongly supporting the State." This factor did not produce a ruling favoring the State, in part due to internal inconsistencies in the State's position.
 
Developments since AOCE have made this factor, if anything, more difficult to asses. Several developments have made the state's finances even tighter. First, the State experienced devastating floods in early 1996, which impacted the State budget. Second, subsequent to briefing in this case, the Oregon Supreme Court struck down Ballot Measure 8. As a result, the State will be obligated to continue to "pick up" the six percent employer's share
 
of retirement payments that Ballot Measure 8 attempted to eliminate.(10) By the State's calculations, this requirement, standing alone, more than exhausts the amounts appropriated for compensation changes in the 1995-97 biennium.(11) Further, the State calculates additional unfunded needs of nearly $100 million, with only $30 million appropriated to cover such needs. These needs include a Department of Corrections deficit, an Oregon Health Plan deficit, a Fish and wildlife deficit, and others issues.
 
Third, following the AOCE award, the State choose to extend similar pay increases to all corrections employees, thus magnifying the fiscal impact of that award. The Association views this rather cynically. As it sees the matter, the State pleaded poverty before this Arbitrator and then choose, after the Arbitrator rejected that plea, to spend more money voluntarily on other employees. The Arbitrator understands the Association's concern that the State had repeatedly predicted, before arbitrators, some untoward consequence of a favorable award, only to avoid that problem when the award went in favor of an employee association. Here, for example, the last interest arbitrator was told an award in favor of the Association would result in a layoff. The award was in favor of the Association, no layoff resulted. The same prediction is now made to this Arbitrator. The State , on the other hand, is obviously concerned that while individual awards (or political decisions related to awards) can be absorbed, at some point the cumulative impact of such individually acceptable decisions will be intolerable.
 
There are two risks here. The first is that the Arbitrator will be mislead by the State into assuming its financial situation is more serious than it is. The second is while the State has either been too pessimistic in prediction or too aggressive in advocacy in the past, or perhaps "too" creative in response to adverse decisions (or a little of all of these) , at some point the prediction of serious results comes true. The Association obviously views the State as repeatedly "crying wolf." Yet, sooner or later, the wolf may really be at the door. Skepticism, but not blindness, is warranted by the history recited by the Association. In addition, the Arbitrator views the decision to extend the AOCE
 
award more charitably than the Association does. The Arbitrator was and remains concerned that Senate Bill 750 did not adequately address issues of internal comparison, internal consistency and equity among State employees. For political officials to make a difficult decision to equalize salaries is not unreasonable and might take place in the face of considerable financial strain.
 
Finally, both parties discuss not only the State's immediate situation, but also its mid-to-long term prospects. The State emphasizes the potential impact of unfunded initiatives. The Association points out that this is nothing but speculation at the present. The Association points out that this agency, in particular, may benefit from having a highly tenured force, many of whom may be retiring, making way for lower-paid recruits, in the near future. The State points out the uncertainties and complications related to this scenario. The Association points out that there is good evidence that the state's revenues are picking up and will end up in far better condition -- by amounts more than adequate to offset the State's concerns -- than the State lets on. In its view, the State's economic forecasts are consistently low. The State argues that economic forecasting is an imperfect science, and that both low and high predictions are inevitably made. It also argues that lottery revenues, in particular., are highly volatile and under pressure from the competition of Indian gaming.
 
On balance, the Arbitrator sees some reason to hope that the State's finances in general and for this agency in particular will improve in the near future. However, this is just a hope and it is not particularly applicable to the 1995-97 biennium. For that period, the State budget is under pressure. This agency would almost certainly need to absorb the impact of an award favorable to the Association. The State's prediction of a resulting layoff is credible, though troublesome in two respects. First, it is clear the agency has chosen to emphasize general law enforcement at some expense to the patrol function. Thus, speculating that a layoff would particularly damage an already thinly-spread highway patrol is to some extent a self-fulfilling prophesy. However, reduction of any service level from this agency is undesirable.(12)
 
Second, there are some alternative means of saving money. The most obvious lies in the flexibility of holding or not holding recruit schools. However, this option has already been used once and it is an option that could be overused, with long-term adverse implications for the agency, precisely because the number of retirements is expected to increase in the near future.
 
Finally, the Association could not resist criticizing the legislature for having, in part, chosen to manufacture this crisis. That criticism could reflect the essence of reason and sound policy; it would still be irrelevant here. The appropriations made are a given and the Arbitrator functions within their limits. In sum, the Arbitrator again finds that this factor strongly favors (but does not alone compel) a finding in favor of the State.
 
C. Attracting and Retaining Qualified Personnel
 
The State makes a strong case that it is able to attract and retain troopers. In 1995, for example, there were 794 sworn employees in the Oregon State Police. Of these, zero were terminated, two resigned, fifteen were eligible to retire, and two actually retired. Also in 1995, 4,202 applicants were invited to test. Of these, 1,157 actually took the test. Of these, 669 passed the test and were invited to a panel assessment. Of these, 601 appeared for the assessment. of these, 175 were judged eligible for a final interview. Of these, 138 took the final interview. Of these, 101 were subject to background investigation, with 40 candidates and 8 alternates selected, resulting in 40 recruit positions filled. Clearly, despite a rigorous application process, Oregon has no difficult recruiting the number of candidates it wants to more than deal with the amount of attrition it experiences at present. The only qualification to this observation is that substantially increased retirement is expected in the relatively near future. This will put more pressure on recruitment.
 
The Association argues that the large number of applicants who "drop out" at some point in this process reflects competition. These applicants are looking at multiple job opportunities and when a more favorable job comes along, they no longer pursue the Oregon State Police job. This is undoubtedly true of some of the individuals represented in these numbers. However, the State has clearly demonstrated its ability to secure the number of candidates it needs. A measure of competition does not undue this persuasive showing. The Association primarily argues that the risk to retention and recruitment for troopers lies in the future. This may be correct, but is necessarily somewhat speculative. The situation for this biennium appears stable.
 
The picture with regard to telecommunicators is not as favorable. While the data is not as complete, it certainly suggests a much higher rate of turnover among a much smaller group of employees. Further, there was testimony indicating real difficulties in maintaining an adequate staff. Clearly, some effort to stabilize the employment of individuals in these positions may be well advised. As to telecommunicators, the retention factor favors the Association.
 
D. Comparison of Overall Compensation: Wage Proposals
 
1. Trooper Compensation
 
This subject relates to two statutory criteria. The first emphasizes that comparison should be made based on "overall compensation." O.R.S. § 243.746(4)(e). The second, already discussed, describes with whom one makes this comparison.
 
One miscellaneous issue must be resolved before making this comparison. The State argues that combining monetary benefits with paid leave tends to irrationally compound figures. That is, the pay for a day of anticipated work is counted, at a certain dollar rate, and then double counted as leave. The Arbitrator agrees. To be sure, the statutory directive to compare total compensation expressly includes paid leave time. However, it does not dictate the method of comparison. Comparing pay first and leave second takes account of total compensation without distorting either figure.
 
Table A, below, summarizes a state-by-state comparison of data provided by the State. It reflects relative ranking at the five year mark, geographic leveling (indicated by an * following each leveled figure), and a simple average of the four states used for comparison (followed by a leveled average). The same figures are then set out for employees at the ten, fifteen and twenty year marks of a career as a state police officer. Several aspects of this array of data are noteworthy. First, taking the case most favorable to the Association (comparison of five year salaries without leveled data), Oregon is somewhat above the four state average ($4,434 versus $4,398). Further, the ranking runs California-Oregon-Washington-Nevada-Idaho, or precisely as one would desire. Taking leveled data as a secondary check on this conclusion, the ranking only changes by Nevada and Washington switching places. Finally, what might appear to be a substantial gap between California ($5,332) and Oregon ($4,434) is at least thrown in some doubt when California's geographically leveled figure ($4,740) cuts the gap roughly in half.
 
TABLE A: State-by-State Trooper Comparisons: Compensation
 
State or Average / Fifth Year / Tenth Year(13) / Fifteenth Year / Twentieth Year
 


 
 
California / $5,332 / $5,332 / $5,332 / $5,480
 
/ $4,740* /$4,740*/$4,740*/ $4890*
 
Oregon / $4,434 / $4, 796 / $4,923 / $5,052
 
4-State / $4,398/ $4,517 / $4,551 / $4,608
 
Average / $4,290*/ $4,428*/ $4,462*/$4,519*
 
Washington / $4,344 / $4,423 / $4,502 / $4,581
 
/ $4,070*/ $4,225*/ $4,303*/ $4,381*
 
Nevada /$4,353 / $4,751 / $4,801 / $4,801
 
/ $4,326*/ $4,721*/ $4,779*/ $4,779*
 
Idaho / $3,561 / $3,561/ $3,561 / $3,561
 
/ $4,024*/ $4,024*/ $4,024*/ $4,024*
 
The conclusion that Oregon is at least holding its own with regard to the salaries of troopers at five years becomes an even more favorable picture for the State when progress in trooper salaries is considered. It appears that Oregon and Nevada share a similar philosophy of increasing trooper base pay significantly with years of service. Washington follow a similar, but less pronounced course. California only rewards a very long term of service (or, conversely, reaches near-top step quickly) and Idaho (perhaps due to difficulties of comparison) rewards experience in the job not at all. Despite these variations in approach, at no point does Nevada, Washington or (obviously) Idaho compensation, or the simple average of the four states, exceed compensation in Oregon. Further, the extent to which Oregon does better than the average (and better than Washington and Idaho) steadily grows. Nevada keeps rough pace with Oregon salaries, but always remains somewhat behind.(14) The most noticeable result of seniority, however, is that California salaries become closer and closer, in absolute terms (and fall below, given leveling) Oregon salaries for more senior troopers.
 
In short, while the five year comparison suggests Oregon is just keeping pace, comparisons using more senior troopers, and comparisons using leveled data, suggest Oregon is solidly situated with respect to trooper cash compensation.(15) Much of the variation in this data reflects different philosophies in salary increases (which are not at issue in this arbitration) more than they reflect absolute differences in lifetime compensation. The f ive year trooper in Oregon is well behind his or her California counterpart. But the twenty year trooper has compensation that is highly competitive (and given geographic considerations perhaps superior) to even this highest paid comparison. In relation to the four state average, Washington, Nevada and Idaho, Oregon retains and builds on the advantage one would expect to find.
 
This comparison, of course, has not considered paid leave. While these figures can be translated into dollar amounts, that tends to import salary rates into a form of compensation that is experienced by employees not in dollars, but in time off. Thus, these figures are summarized in monthly paid leave hours in Table B, below. This array of figures does nothing to detract from the showing already made and to some extent reinforces it. Thus, for example, Nevada provides slightly more paid leave for junior employees than Oregon, but Oregon in time catches up. This would, if combined with cash compensation, somewhat narrow the gap between Oregon and Nevada, but not change their overall ranking.(16)
 
TABLE B: State-by-State Trooper Comparisons: Monthly Hours of Paid Leave
 
State or Average / Fifth Year/ Tenth Year / Fifteenth Year / Twentieth Year
 
Nevada / 27.3 / 29.3 / 31.3 / 31.3
 
Oregon / 26 / 28 / 30 / 32
 
Washington / 25.3 / 26.7 / 29.3 / 30
 
4-State Average / 24.8 / 26.7 / 28.6 / 29
 
Idaho /24 / 26 / 28 / 28
 
California / 22.7 / 24.7 / 25.7
 
Further, this effect diminishes, and finally reverses slightly, with seniority. Washington, the four state average, and Idaho all maintain their relatively lower ranking. Most marked, however, is that California has the lowest level of paid leave, which (in any valid "combined" sense) would somewhat reduce its relative advantage in pay.
 
The conclusion for inter-state comparison of the total compensation of troopers is unmistakable. Oregon's total compensation is proper, at current levels, in relation to these other states, with some room to spare.
 
This leaves the issue of in-state comparisons. Here, the data provided by the parties does not entirely match up with the conclusions reached by the Arbitrator.(17) While Table C, below, may mix apples and oranges and be otherwise inadequate to some degree, it must serve. This data array suggests that Oregon is not performing nearly as well in relation to large local jurisdictions as it is in relation to surrounding states. This appearance is reinforced by the notable absence of state data for the City of Portland and at the five year mark; and by the use of simple (not weighted) averages in this array. Because these jurisdictions are in labor markets the State also participates in, weighted averages would be proper. On the other hand, this relatively poor performance is mitigated over time. Clearly, Oregon's rewards for seniority make it more competitive with these jurisdictions (save, perhaps, Portland) the more troopers gain experience. This is significant, since a major concern of the Association is that the State not become a training ground for local police. Given that troopers will receive less economic benefit from leaving for local employment, even in the largest jurisdictions in the state, as their seniority grows, the State becomes more nearly competitive with these jurisdictions (again, with the probable exception of Portland) over time.
 
TABLE C: In-State Trooper Compensation Comparison
 
Employer / Ass'n. Fig. /State 10-year Fig. / State 15-yr. Fig. / State 20-yr. Fig.
 
Portland / $4,158 / n/a / n/a / n/a
 
Average excluding Oregon(18) / $3,956 / $4,931 / $5,014 / $5,042
 
Multnomah /$3,915 / $4,790 / $4,899 / $4,899
 
Clackamas / $3,793 / $5,071 / $5,128 / $5,185
 
Oregon / $3,521 / $4,796 / $4,923 / $5,052
 
The in-state comparison should caution one from drawing too strong a conclusion favoring the State from the inter-state comparison. However, for reasons already discussed, the inter-state data is more significant than the in-state data. It follows that total compensation of troopers is comparable to the proper comparisons.
 
2. Telecommunicator Compensation
 
The Association has made a "catch up" proposal for State police telecommunicators. Unfortunately, the data regarding telecommunicators from both parties is far less complete than the data regarding troopers. The Association provides data on "top step wages," while the State provides a ten-year, total compensation comparison. Reviewing both sets of data, a number of observations are in order. First, the Association's wage data does not amount to a total compensation comparison. This throws serious doubts on any firm conclusions being drawn from this data.
 
Second, despite this, there are troubling aspects of this data. It appears telecommunicators in all other jurisdictions reach their top step wage much more quickly than in Oregon.(19) Second, given the limited data provided to the Arbitrator it appears that Oregon telecommunicators may be well behind their counterparts in other states and localities in the first five to seven years of employment. Given the demands of this job and the evidence on turnover (discussed above), the relatively low start and slow progress in salaries for these employees may not be appropriate. Of course, the Association has not proposed a modified structure for the salary scale. Its proposal of two two- percent "catch up" raises across the board is not exactly tailored to the problem the evidence suggests.
 
Again, the evidence on this issue is incomplete. Also, counsel for the Association argued that the compensation of telecommunicators and 911 operators was a "national scandal." That may well be correct. That is not, however, a problem that comparability analysis is likely to correct. Given all these considerations, the Arbitrator finds the Association proposal for the two percent "catch up" raises superior to the state's proposal. However, this conclusion is not as strong as that regarding troopers and this classification does not carry as much weight in the final analysis as the trooper classification.
 
E. CPI: Wage Proposals
 
A proposal for a wage freeze is obviously at odds with the statutory criteria of considering the CPI. The State attempts to avoid this straightforward conclusion with three primary arguments.
 
First, the State argues that it still gives employees step increases, so there is no real "freeze." This argument is not persuasive. To be sure, there is a difference between a absolute wage "freeze" and a refusal to grant a COLA. However, the CPI factor in the statute clearly contemplates that salary schedules will not be eroded by inflation. While step increases may allow an employee hired in 1985 to maintain his or her standard of living, this will be cold comfort to the trooper hired in i995 or 2005 who is, in effect, being asked to be part of the first generation of Americans to face a diminished rather than an enhanced livelihood. The CPI provision in the statute does not make this pessimistic assumption. It assumes (all other factors being equal) that an employee newly hired in 1997 will be compensated at a rate commensurate with the same category of employee hired in 1987.
 
More plausibly, the State points out that it formerly gave certain employees performance-based or incentive pay of four to eight percent. This pay, received by a substantial number of employees, has now been "grandfathered" and transformed into a element of pay certain employees are entitled to. While the State jumps through various mathematical hoops in the effort to analyze this pay, its basic point is that this newly entitled pay has become an effective buffer against inflation, at least for a two year period, for those employees who receive it. This view of grandfathered incentive pay is plausible, but not fully persuasive. It is true that this is no longer performance based pay and is not part of the salary base. Thus, it will hedge that base against inflation for a time. However, this argument is incomplete in several respects. It applies only as to those employees who receive this pay. Those who do not are still locked into the 1995 salary schedule. Further, among the employees with this pay, those who received a four percent raise probably have inadequate protection against inflation. Thus, as to a majority of troopers, there is no escaping that this proposal freezes wages and thus fails to account for the CPI. Finally, even for the employees who receive this pay, it merely changes the point in time at which they return to the regular salary schedule. If that schedule is not adjusted for inflation the grandfathered incentive only delays matters. Thus, this pay has limited, or partial, relevance to this biennium, but is not an across-the-board solution to CPI concerns.
 
Third, the State attempts to analyze CPI from 1985 to the present. In this way, all base salary increases, of any description and given for any reasons, are counted against CPI. Again, this is not persuasive. Some of these increases were given for non-CPI related reasons and should not necessarily count in this analysis. More importantly, to the extent the Arbitrator has found troopers (but not telecommunicators) to be just adequately compensated, that is a "snapshot" of the situation in 1995. If comparably situated employees receive COLAs in 1996 and/or 1997, that appropriate wage position will be eroded by the lack of any cost of living adjustment in this biennium.
 
In sum, while the State has makes several different efforts to reconcile a wage freeze with the statutory CPI criteria, this is not possible. This factor strongly favors the Association.
 
F. Insurance
 
The Arbitrator sympathizes with both parties on this issue. Clearly, this is a group of employees with a special interest in health insurance. Further, imposing the cost of insurance, in part, on these employees aggravates the wage freeze by actually reducing, to some degree, employee salaries. on the other hand, this is a cost to the State which will predictably escalate. It is most likely a cost that will escalate a rates exceeding general inflation (though recent events throw some doubt on that trend). That is, health insurance costs can make employees, even simultaneously, more expensive and less well compensated. The Association also points out that the State has agreed with the Oregon Public Employees Union to pay full health insurance costs for the employees it represents. Clearly, this is group of employees, of the very same employer, whose need for health insurance cannot be greater than the need of the State Police. Based on this comparability consideration, this factor strongly favors the Association.
 
G. Clothing Allowance
 
The State proposes to allow managers to approve or disapprove how employees use their clothing allowances. The State supported this proposal with exhibits showing individuals had purchased clothing or footwear that the State questioned as either inappropriate for police work or too expensive. The Association argues, with considerable logic, that the State's identified problem is based on faulty reasoning. It is undisputed employees are to be appropriately attired for police work. If an employee, therefore, spends all of the allowance on, say, an expensive pair of cowboy boots, that employee is thereafter obligated to pay his work-related clothing needs out of his or her pocket. Thus, an imprudent use of the allowance does not harm the State, it harms, if anyone, the employee. The logic of this argument is impeccable. It misses, however, one point of interest to the State. A public perception of wasteful spending could be readily created by publicity related to certain of the matters put in evidence. The State has an interest in avoiding this perception, even if employees end up paying the real cost of appropriate attire.
 
The Association also objects to the means the State has chosen for solving the problem. This is to allow managers to second-guess employe purchases. As the Association puts it, "we will now be arguing whether a dress shirt should be purchased from Nordstroms versus K-Mart." The Arbitrator agrees. The legitimate "image" problem the State has identified could be addressed by a listing of what will be considered appropriate expenses or by spreading the payment over time to avoid very expensive individual purchases. A prior approval process is needlessly intrusive and invites abuse and petty disputes. The Arbitrator recognizes that the State says it will only make limited use of the power it seeks. However, power, once given, is not necessarily contained by good intentions.
 
In sum, the Arbitrator finds that the State has a legitimate concern with the appearance created by employee purchases of apparently inappropriate or expensive items with the clothing allowance. The Arbitrator is not persuaded the State has found the cure for this problem. Thus, the Arbitrator finds, on balance, that this proposal favors neither party.
 
H. The Shoe Issue
 
The concern that power, once given, is easily abused, is not alleviated by the State's argument that it simply has the power to do as it chooses with regard to employee footwear. It is clear that troopers have a need for functional footwear that is not fully addressed by the current approach. The State has recognized much the same sort of need for range masters, criminalists, detectives, SWAT team members, fish and wildlife detectives and others. The similar need of patrol officers and communication systems analysts was persuasively demonstrated.
 
It is true that employees can be expected to make their own expenditures for some clothing and shoes. However, under the statutory criteria, internal comparability strongly suggests arrangements similar to those made for a significant number of State Police should also be made for patrol officers and communication systems analysts. The cost of this is not great by any measure. This issue strongly favors the Association.
 
I. Outpost Itinerary and Pay
 
The State made a persuasive showing that the need for the outpost itinerary was outdated. However, it is not clear there is any pressing need to change this provision. Further, the Association is correct that whatever need for change there is does not necessarily go the wage premium provided for in this section. Since this removes an opportunity for premium pay from employees being otherwise subjected to a wage freeze by the State proposal, the Arbitrator finds that this issue somewhat favors the Association.
 
J. Crime Laboratory Parking
 
The Arbitrator sympathizes with the difficulties attendant on commuting to and parking in a crowded city core. The Arbitrator also believes that certain employees in this unit may have a valid complaint that state vehicles are not sufficiently available for their work needs. That complaint is not directly addressed, however, by providing parking for employees who commute by car.
 
The main argument the Association offers is, at bottom, one of comparability. Employees in Salem get subsidized parking. Employees in other parts of Portland get subsidized parking. University employees get subsidized parking. California and Washington employees get some subsidized parking. The difficulty with this approach is that it assumes all these employees are similarly situated with regard to parking. They are not. Parking costs are largely a function of location. What the State is readily able to accommodate in one city or even one neighborhood is not a reasonable measurement of what is available in other cities or neighborhoods. Conversely, not just the crime lab employees, but many public and private employees who choose to work in downtown Portland must confront a similar set of issues. In general, parking is viewed as one of those "unintended benefits which are incidental by-products of production and services . . ." Hill & Sinicropi, Management Rights (BNA 1986) 46. In short, the Arbitrator was not persuaded that this comparability argument made appropriate comparisons or that the "incidental" benefits other employees enjoy in other locations translated into an entitlement for these employees.
 
Beyond this, it is clear that Oregon has taken steps to encourage use of mass transit and discourage excessive commuting into downtown Portland. The State is correct that there is tension between this policy and subsidizing parking. The Arbitrator appreciates the inconveniences of the alternatives to driving, but commuting remains, at bottom, a product of employee choices and an employee responsibility. The Arbitrator certainly agrees that the State should look for opportunities to address the issue of having adequate state vehicles available for these employees. The Arbitrator does not agree that a parking subsidy is the only, or best, way to address this issue. This proposal favors the State.
 
R. Pilot Differential
 
The Association proposes converting a premium paid per hour in flight to a premium calculated as a percentage of salary. The essence of the Association's case for a new pilot differential is twofold. Pay by hours in flight does not take account of the nature of piloting in several respects. It does not account for hours spent in preparation or inconvenienced by flight (e.g., time on the ground at a remote location waiting to make a return flight) . It also has an inverse relationship to true pilot skills, since pilots flying more demanding, faster, planes are paid less for their greater skill and preparation. Second, the proposed premium appears much more comparable to pilots for police forces in some of the comparable states. The cost of this premium, given the number of employees, is not great.
 
The State argues that this premium is unjustified because pilots have many non-flight-related hours of duty. Further, it views the Association's comparison as reflecting a variety of practices and not adequately accounting for certain in-state comparisons. However, the Arbitrator notes that certain costs incurred by the pilot (namely in training) are related to having the assignment of being a pilot, not to the number of hours in flight versus other duties. Thus, a premium based on pay does not appear irrational, even when pilots perform other services.
 
The Association's proposal may not be a perfect fit and there is no doubt comparisons will show a variety of practices on this sort of marginal pay issue. However, it appears that a rate based on something other than hours of flight is justified and that some comparable employers have used a percentage similar to that proposed by the Association. The Arbitrator finds the Association proposal somewhat superior.
 
L. Compensatory Time
 
The Association primarily contends that as a matter of law compensatory time must be at employee option unless employees agree, individually or collectively, otherwise. The State argues that a collective bargain is such an agreement and the existing agreement should be continued. Further, the State presents an elaborate hypothetical description of how compensatory time at employee option could effect its scheduling and operations. The Association's rejoinder is that the current collective bargain was imposed by a statutory interest arbitrator and is, therefore, not an "agreement" within the meaning of the law. The parties agree there is no case exactly on point with this legal dispute. The Association also points out that it has adjusted its proposal to deal with "some" of the practical problems feared by the State. This is not the ultimate forum for resolution of the legal issue presented by the Association.(20) Nonetheless, the Arbitrator believes the Association's position on the law has the force of logic. Clearly, compensatory time is the result of an agreement. While parties can agree to produce an agreement through interest arbitration, or in a variety of other indirect fashions, that is not the situation here. Here, interest arbitration is imposed by state law as a compelled alternative to parties engaging in the voluntary process of a strike or lockout. Though an arbitrator's action under this statute is enshrined in a document called a collective bargain, it is, as the Association argues, a result compelled by legislation and a third party. Further, even if the Arbitrator's best guess on this legal issue turns out to be mistaken, there is no question that the State's position invites litigation. That in itself, is not desirable.
 
On the other hand, the Association concedes that its proposal addresses only some of the State's practical concerns. The Arbitrator finds, thus, that these matters are in balance and this proposal does not favor either party.
 
III. CONCLUSIONS
 
The following lists briefly summarize the findings made on each individual issue considered above.
 
MAJOR ISSUES
 
1. Ability to Pay: strongly favors the State.
 
2. Ability to attract and retain employees.
 
a. For troopers: strongly favors the State.
 
b. For telecommunicators: favors the Association.
 
3. Comparability of overall compensation:
 
a. For troopers: favors the State.
 
b. For telecornmunicators: favors the Association.
 
4. CPI: strongly favors the Association.
 
MINOR ISSUES
 
1. Insurance: strongly favors the Association.
 
2. Clothing allowance: favors neither party.
 
3. Shoe issues: strongly favors the Association.
 
4. Outpost Itinerary and Pay: favors the Association.
 
5. Crime Laboratory parking: favors the State.
 
6. Pilot differential: favors the Association.
 
7. Compensatory time: favors neither party.
 
8. Retirement: rendered moot by action of the Oregon Supreme Court.
 
Though this appears to be a closely balanced set of conclusions, the overall picture favors the State in two respects. First, as to both retention of employees and wages, the troopers are the dominant classification. Thus, both these major factors could be summarized as simply favoring the State. It follows that three of the four major factors actually favor the State to some degree. While the CPI issue remains a concern to the Arbitrator, it is insufficient to overcome the other issues, especially in light of the ability to pay concerns.
 
Second, while at some point a lengthy list of minor issues favoring one party will change a balance otherwise struck in favor of the other party, the Arbitrator does not believe the Association's case quite met that test in this case. Though on four minor issues -- two of them decisively -- the Association proposals had merit, the remaining four minor issues are, respectively, moot, in balance, or in favor of the State.
 
Though the Arbitrator finds flaws in the State's proposal, and virtues in the Association I s, under the statute he must approve one proposal or the other. On balance, and not without reluctance, that proposal is the State's. Award
 
The Arbitrator selects, approves and directs the parties to implement the proposal of the State.
 
William P. Bethke
 
Denver, Colorado
 
August 2, 1996
 
Appearances:
 
Daryl S. Garrettson, Esq., John Hoag, Esq., for OSPOA
 
Gary M. Cordy, Assistant Attorney General, and Eva Corbin, Labor Relations Manager, for the State of Oregon
 
Footnotes:
 
1. Association of State Corrections Employees and State of Oregon (February 5, 1996).
 
2. Of course, declarations of primarily symbolic value, with little or no operative effect, are not unknown the annals of legislation. See, e.g., Pennhurst State School v. Halderman, 451 U.S. 1 (1980) (Congressionally declared "Bill of Rights" for certain persons merely "encouraged" certain state policies).
 
3. The Arbitrator appreciates that the Association had second thoughts about giving such prominence to intrastate comparisons. However, the reasoning of its original argument appears sound. Further, the Arbitrator's has serious doubts that the statute actually contemplated any particular method of in-state comparison. For both reasons, it is appropriate to adopt the original, clearly agreed, position of the parties.
 
4. If it had, not only California but Idaho and Nevada would also be eliminated as a basis for comparison. Indeed, Washington would probably be eliminated as well, replaced by states far closer in population to Oregon, such as Mississippi and Connecticut.
 
5. This is thought to be particularly the case because California sets salaries for its state police by reference to the cities of San Diego, Los Angeles, San Francisco and Oakland.
 
6. California is followed by Washington (149), Idaho (32), Nevada and Texas (23 each), then Minnesota, Arizona, Utah and New York. The State attempted to minimize California's role in these figures by dividing by population. Clearly, however, if inter- state comparisons are not be weighted by population for Association purposes, as discussed below, they should not be discounted by population for State purposes.
 
7. This is the express design, for example, of the statute governing the California state police. See n. 5.
 
8. The Association also raises serious questions about how to compare "apples to apples" in the case of Idaho, which has an unusual salary structure. The Association is correct in viewing the Idaho data as the most difficult and suspect.
 
9. Ford Motor Company, 19 LA 237, 241-2 (1952).
 
10. This decision, being premised on the Constitution of the United States, is subject to review by the United States Supreme Court. Such a review would be requested by petition for certiorari filed within ninety days of the final decision in the State Supreme Court -- or sometime in the early fall of 1996. If a request is filed, there are three reasonably likely outcomes: (1) the petition is denied and no review takes place; (2) the petition is granted and the decision of the Oregon Supreme Court is affirmed; or (3) the petition is granted and the decision of the Oregon Supreme Court is reversed. Only the third outcome is a concern" and it would, almost certainly, not take place until after (1) the 1995-97 biennium is over or all but over; or, at least, (2) the new legislature convenes and is in a position to address the issue. This third outcome is also, relative to the first two, unlikely.
 
11. Many collective bargaining proposals attempted to neutralize the salary (and budget) impact of Measure 8. The Legislature, however, assumed a savings. Thus, this is not a new cost but an anticipated savings that has not materialized (and might not have, even had Measure 8 been valid).
 
12. The legislature has expressed its disapproval of any "material" reduction in "program or service levels" of this agency. Ore. Laws 1995, ch. 159, § 5.
 
13. The State makes a second comparison of the ten year rates in other states to troopers in Oregon who have had previous incentive pay "grandfathered." The Arbitrator does not set out this comparison for four reasons. First, it is less favorable to the State than a straight ten year comparison. Thus, there is no harm to the State in omitting it. Second, this pay is not given to all employees and is thus not really a "base" comparison for the population of employees. Third, this pay is not part of the permanent pay structure and may distort comparison of permanent features. Fourth, this pay is most appropriately considered in relation to CPI issues, and thus will not be ignored in the total analysis.
 
14. Notably, geographic leveling significantly lowers California data, noticeably lowers Washington data, significantly raises Idaho data, but leaves Nevada data relatively untouched. Apparently, geographic leveling suggests Nevada is the closest analogy to Oregon. This counterintuitive result may reinforce the Association's doubts about this methodology.
 
15. Though the Association uses different assumptions, resulting in different data, and thus different ultimate figures, one pattern is similar. Using the Association I s figures, f ive year troopers fall between 16 and 20.2% behind in total compensation. At the ten year mark this falls to 9 to 13%; at the fifteen year mark it is 6 to 10%; and at the twenty year mark the figures are 5 to 9%. That is, the five year figures are the most unfavorable and the disparity gradually falls. Further, using Association data, but a simple and not weighted average, the twenty year Oregon trooper is as much as 4% ahead of the four state average and the 16 to 20% disparity for the five year trooper falls to the 4 to 5% range. If vacation and holiday pay were analyzed separately, the cash compensation averages would be still more favorable to Oregon troopers.
 
16. Thus, for example, translating these figures into cash would yield, at the five year mark, a $61 advantage for Nevada troopers in leave, but this is overmatched by an $81 ($108 if leveled) advantage for Oregon in other compensation. The five year comparison is the one most favorable to the Association.
 
17. The Association provided data on rates going into effect in 1996. The Arbitrator believes the appropriate comparison is of the rates in effect in 1995.
 
18. These are simple averages derived by the Arbitrator from raw data. Weighted averages might favor the Association more.
 
19. See, e.g. Association Exhibit 5.2.1, "YEARS TO TOP STEP" column.
 
20. On the other hand, the U.S. Supreme Court's recent ruling that Congress cannot waive the Eleventh Amendment and subject the States to suit in matters not grounded in the 14th Amendment may make identifying the proper forum a difficult question.