Committee approves Pay Act H.950 to fund 5.9% (FY27) and 4.9% (FY28) salary increases, plans to include funding in budget

The House Appropriations Committee on March 24 reviewed and voted to approve H.950, the Pay Act, which would appropriate money to fund negotiated salary increases for state employees across the executive, judicial and legislative branches for fiscal years 2027 and 2028.

Brynn Hare, director and chief counsel of the Legislative Council, told the committee that section 1 of H.950 implements the collective bargaining results: for fiscal year 2027 employees receive a 1.9% average step increase plus two scheduled increases (2% in July and another 2% in January), for a total 5.9%; fiscal year 2028 applies a 1.9% step increase plus 3% for a 4.9% total. "It authorizes funds for executive, judicial and legislative branch employees to ensure that their negotiated salary increases are funded for 2 fiscal years," Hare said in her presentation.

Hare explained the bill is permissive for exempt employees: section 2 allows branches to extend collective bargaining provisions to exempt staff as budgets allow, and section 3 directs that any governor-approved adjustments for executive-branch exempt agency heads and deputies should track the percentages in section 1.

Committee members pressed presenters on how benefits costs relate to the Pay Act. Department of Human Resources representatives and Legislative Council staff clarified that the Pay Act appropriates funding for salary increases only; benefits and base-salary funding remain part of the governor's recommended budget and are handled separately.

The bill also updates statutory salaries for elected and specified officials and employees: sections outline adjustments for executive branch statutory salaries and department heads, judicial branch officers (chief and associate justices, assistant judges and probate judges), county sheriffs and state's attorneys. Hare read the appropriation language in section 10: for FY27 the executive-branch increases are funded with $23,918,120 from the General Fund, $3,000,000 from the Transportation Fund and $27,184,607 from other funds; for FY28 those executive-branch amounts are $24,974,632 General Fund, $3,000,000 Transportation Fund and $28,362,343 other funds. Judicial branch FY27 General Fund appropriation was listed as $3,800,867 (FY28 General Fund $2,466,396); legislative branch appropriations were presented as $914,634 (FY27) and $778,939 (FY28).

Andy of the Joint Fiscal Office reviewed the fiscal tables and confirmed the committee had been carrying these numbers in its budget construct even where they had not yet been appropriated. He said the fiscal note tables show the percentages and the appropriation breakout and that the numbers have been moving as additional analysis occurred. The committee reiterated general-fund totals of roughly $28.6 million for FY27 and $28.2 million for FY28 during that discussion.

Representative Matt Barag, chair of the House Government Operations and Military Affairs Committee, said his committee reviewed the package and recommended it forward. "I just see this as an incredibly vital piece of legislation, a money bill that puts the paychecks in hands of the people who operate our mechanisms of government," Barag said.

Some members expressed concern about timing and fiscal pressure. The presiding Chair noted surprise at the size of the negotiated increases given the broader budget constraints and said members were "struggling with that" in light of the state’s difficult budget conversations. Hare and other staff emphasized the increase figures come from collective-bargaining agreements negotiated by the unions and administration and implemented by this appropriation.

A motion and second were made to approve H.950 in committee. The committee proceeded with a roll-call-style affirmation; the chair reported the committee had voted unanimously in its prior Government Operations committee review and referred to a 9–0–1 recognition. The Appropriations Committee recorded the motion as approved and directed staff to follow up with floor/committee insertion into the budget process; the chair said he would check with the Speaker about including the pay act in the budget. The floor was recessed until 1:00 p.m.

Next steps: committee staff and Joint Fiscal Office will follow up to confirm budget insertion and any presentation responsibilities; the bill will move forward consistent with the budget timetable.