District of Columbia:

Funding for Certain Union Employee Pay Bonuses

AIMD-00-309R: Published: Sep 13, 2000. Publicly Released: Sep 13, 2000.

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Pursuant to a congressional request, GAO provided information on the District of Columbia's funding for certain union employee pay bonuses.

GAO noted that: (1) the District reported a surplus of about $445 million for fiscal year (FY) 1998, thus triggering the need to reopen negotiations about bonus compensation with certain union employees, based on a 1998 agreement; (2) negotiations took place and an agreement was reached during November 1999; (3) the bonus payment of $9.9 million applied to 5,746 District union employees in two compensation plans represented by several union organizations; (4) the $9.9 million represents a one-time, lump-sum bonus of about $1,700 per employee, which the District paid in December 1999; (5) several funding plans were advanced before arriving at the final approach; (6) initially, the bonuses were to be funded from the following sources: (a) $4.2 million from the Tobacco Settlement Fund (TSF); (b) $3.5 million from FY 2000 budget; and (c) $2.2 million in grants from the Financial Responsibility and Management Assistance Authority; (7) the District proposed to reimburse the TSF by reprogramming funds from the Department of Public Works and through short-term borrowing; and (8) the District of Columbia Council and the Authority approved the proposed reprogramming.

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