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10-31-10 Editorial in the News
Gov. Chris Christie wants to cap public employee salaries at 2 percent. "...Democrats say the hard cap would end collective bargaining as we know it, an injustice when you consider that cops, firefighters and teachers are forbidden — by law — from striking. There is room for reasonable compromise. The salary cap could exempt health and pension costs, as the cap on property taxes does. It could apply an average raise over the life of a contract, rather than each year. It could automatically sunset after a few years, so the Legislature can study the impact before making it permanent. It could be tagged to the inflation rate, rather than a hard percentage. If the governor agreed to those changes, he would win significant Democratic support..."

'Cap salaries, but with a compromise' Published: Sunday, October 31, 2010 Star-Ledger Editorial Board Matt Rainey/The Star-Ledger Gov. Chris Christie wants to cap public employee salaries at 2 percent. With the tunnel nixed, a lot of backhoe operators are available. They can find work in Trenton, where the Democrats and Republicans are digging in to battle over a salary cap for public workers. In July, legislators passed a 2 percent cap on the tax levy, the first step in taming the nation’s highest property taxes. But a tax cap alone is not the answer. Mayors need weapons to combat rising labor costs, or their only option will be massive layoffs that threaten public safety and damage schools. Gov. Chris Christie wants a 2 percent cap on total compensation (salaries and benefits) awarded to local employees, while Democrats say that is too harsh. Given rising health costs, meeting a hard 2 percent cap could force salary cuts year after year. In addition, Democrats say the hard cap would end collective bargaining as we know it, an injustice when you consider that cops, firefighters and teachers are forbidden — by law — from striking. There is room for reasonable compromise. The salary cap could exempt health and pension costs, as the cap on property taxes does. It could apply an average raise over the life of a contract, rather than each year. It could automatically sunset after a few years, so the Legislature can study the impact before making it permanent. It could be tagged to the inflation rate, rather than a hard percentage. If the governor agreed to those changes, he would win significant Democratic support. But a salary cap is needed, despite the resistance of old-school Democrats. The bargaining rules have been rigged against taxpayers for too long, leading to ruinous increases in the regressive property tax. And that goes not just for police and fire, who are covered by binding arbitration rules, but for school employees, whose salaries could be capped through county superintendents’ offices. A bill passed by the Assembly budget committee makes some improvements to binding arbitration, but included no salary cap. The Democratic caucus rejected that plan last week after local officials protested. And the governor has made it clear he will reject a bill that has no cap as well. It is true, as Democrats says, that some progress has been made since former Gov. Jon Corzine passed a weaker version of a property tax cap, putting downward pressure on wages. Since 2005, binding arbitration awards for cops and firefighters have ranged from 3.96 percent in 2005 to 2.45 percent in the last six months of 2010. But those numbers could turn around again without a cap in place. Given the severity of this problem, that’s not a risk New Jersey can take. Assembly Speaker Sheila Oliver and Senate President Steve Sweeney have both signaled a willingness to compromise. The governor may be tempted to take a hard line, even if it results in stalemate, and to use this issue to win Republican seats in next year’s election. That would lead to massive layoffs next year. Our hope is that he instead compromises, as he did on the property tax cap.