Bob Hennelly
WNYC's Bob Hennelly is an award-winning investigative journalist. While at WNYC he has reported on a wide gamut of major public policy questions ranging from immigration and homeland security to power outages and utility mergers.
Christie and Dems Reach Landmark Deal
Friday, December 10, 2010
Republican Gov. Chris Christie of New Jersey.
(Kevork Djansezian/Getty)
As a result of a bipartisan compromise, New Jersey police and firefighters won't get more than a two percent raise over the next three years. Under the deal struck by Governor Christie with legislative leaders to cap first responders salaries, there will also be major reforms to how contracts are negotiated.
-
Read. Argue. Listen. Act.
More - Join the Discussion [6]
-
Recommended Links
Under state law, police and firefighters are prohibited from striking, but they do have the protection of binding arbitration. Local governments complained that even as the economy stalled, arbitration awards exceeded the rate of inflation and, in turn, pushed up local property taxes.
Senate President Steve Sweeney said now contract arbitrators have to take local financial conditions into account and that the reforms will help local governments balance their budgets..
"An arbitrator has to actually put in a written report on how they looked at the municipal finances when they came to the determination of the award -- the ability to pay -- which they never had to do before," Sweeney said.
On January 1, local governments also face a two percent cap on property tax hikes.
Bill Dressel with the New Jersey League of Municipalities said the deal was a breakthrough for local governments. "The true test will come when we see if it helps keep property taxes hikes within the two percent cap."
Dressel said a lot more needs to be done to help local government keep a lid on costs, like civil service and pension reform.
Sweeney agreed with Dressel that Trenton's next heavy lift is coming to terms with the state's public employee pension crisis. Currently, the state's public pension fund is under-funded by $46 billion.
A vote on the police and fire salary cap and contract reforms could come as early as Monday.
Comments [6]
An arbitrator who is evaluating "ability to pay" must necessarily be asked to look at the choices a locality made in where to spend their dollars. It is inherently unfair to claim no ability to pay for a raise for some workers when the municipality has spent money to give raises to other employees (administrators, politiicans) or has chosen to give tax breaks to developers or for job creation rather than set aside that money to provide raises to first responders.
I don't think that the consequences of this kind of review were throught through very carfully by the drafters of this law. Will the arbitrator be able to say the local legislators made poor choices? Will all of these decisions have to be made by public referendum?
Alvin wants to exclude overtime from public pensions. He forgets that many first responders are required to work overtime. Shouldn't those hours of earned salary count toward pension. If employers wnat to exclude overtime costs from pension, the fair way to that is to hire enough full-time employees to obviate the need for overtime. Alternatively, the employer can prevent employees collecting large amounts of overtime by negotiating a limit on the number of hours for the year, or negoatiate a cap on the percentage difference between an employee's final salary and the salary earned in the year(s) preceding retirement.
Instead of being critical of the defined pension benefit plans that public employees have negotiated for (and paid for by deferring wage increases), Alvin and others should be asking why all employees, public and private, can't get defined pension benefit plans.
The data is clear that providing retirees with adequate incomes is good for the economy. Retirees with incomes above the poverty level, spend money creating demand and jobs and continue to pay taxes. Isn't that what the economic reforms are intended to create?
Next step: Have all public employees contribute to their health care coverage.
Excellent read, I just passed this onto a colleague who was doing a little research on that. I found it for him smile So let me rephrase that: Thanks so much! Regards, http://www.telegenisys.com
Excellent read, I just passed this onto a colleague who was doing a little research on that. I found it for him smile So let me rephrase that: Thanks so much! Regards, http://www.telegenisys.com
typo - I meant "earning" in paragraph 2, not "early"
How about a law that overtime does not count towards final average salaries for pension costs?
People are already early 1.5x their hourly rate for overtime. Why should they also be given a boost to their monthly pension payment for 20 or 30 years?
How much does each of these overtime hours actually cost taxpayers? I think $800 or more per overtime hour for those retiring at age 50 with 30 years served.
Under the current system, there's a huge incentive to work massive overtime hours to boost pensions.
Leave a Comment
Register for your own account so you can vote on comments, save your favorites, and more. Learn more.
Please stay on topic, be civil, and be brief.
Email addresses are never displayed, but they are required to confirm your comments. Names are displayed with all comments. We reserve the right to edit any comments posted on this site. Please read the Comment Guidelines before posting. By leaving a comment, you agree to New York Public Radio's Privacy Policy and Terms Of Use.