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'It's time: Freeze N.J. public workers' pay, change bargaining rules' By Star-Ledger Editorial Board, A series: Going broke-- 'The high cost of public workers' Tomorrow: 'How to fix the broken negotiating rules that are rigged in favor of the unions'
'The NJEA vs. Governor Christie: Two powerhouses doing battle' Sunday, February 28, 2010 The Record
The New Jersey Education Association is a powerhouse of a union — with a massive membership and a multimillion-dollar wallet that it has used to press its causes, from smaller class sizes to larger pension payouts.
It is long accustomed to getting its way.
But now, the man the union worked so hard
to keep out of the governor's office is in
charge in Trenton..."
It's time: Freeze N.J. public workers' pay, change bargaining rules
By Star-Ledger Editorial Board/The Star-Led...
February 28, 2010, 5:27AM
In November, when Marlboro teachers refused to contribute a nickel toward their skyrocketing health care premiums, the board of education stood its ground and was applauded statewide for not buckling. Taxpayers hoped this would be a rare occasion when a school board went nose-to-nose with a union and didn’t get body-slammed. Two months later, the board caved.
Marlboro teachers still contribute nothing on health care. They will get 23 percent raises spread out over five years. And now they qualify for family coverage in the first year, ending the previous three-year wait.
This, sadly, is typical in New Jersey. Because the collective bargaining system is broken. The rules are tilted in favor of the unions.
We have the highest-paid police officers in the country, and they can retire after 25 years at 70 percent of their highest salary. We have the nation’s highest-paid firefighters, too.
Salaries for our teachers are always at the top of the nation, or close to it. And most pay nothing for red-carpet health benefits for life.
This year, in the middle of a punishing recession — when more than 10 percent of New Jerseyans are out of work, when others are having their pay and hours cut, when many are losing homes to foreclosure — teachers’ average base salaries rose by nearly 5 percent, double the rate of inflation.
We can’t afford this. Taxes are too high as it is, and we face a mountain of unpaid pension bills. If we were a private company, we’d be General Motors.
So it’s time to go nuclear. It’s time to rewrite the rules. It’s time for the showdown with unions that has been brewing for years.
The first step is to freeze public-worker salaries — state, local, and school — for at least one year. Some of that can be done immediately by law. Some of it will take time because we can’t break contracts unilaterally.
Step two, which we’ll discuss tomorrow, is to use that one-year breather to rewrite the bargaining rules with taxpayers in mind.
Municipalities and school boards have proven unable to hold the line, so it’s time to take negotiating power away from them. The best answer is for the state to take over contract negotiations on a regional basis. The Legislature also could place a cap on annual increases in labor costs, by law. With that, a long-term fix will be in place.
The key players
Win or lose, the steel-cage battle between public unions, with 406,000 members, and the state’s other 8 million residents is shaping up to be the political fight of the decade and Gov. Chris Christie’s defining moment. It’s the Battle of Trenton. We’ve waited long enough.
“Without controlling these costs, we are on a treadmill of ever-higher tax rates,” Rutgers University economist Joseph Seneca says. “That’s going to mean fewer jobs, and slower income growth. The economic engines of the state are at risk.”
Here’s what the key players will have to do to make this work:
Republican Gov. Chris Christie will have to threaten massive layoffs to convince state workers to reopen their contracts and extend the temporary pay freeze they agreed to last year. The contract they signed with Gov. Jon Corzine contains a time bomb that gives state workers two raises in the coming fiscal year. Christie can’t let that happen. And he says he won’t.
The Democratic-controlled Legislature can pass a law imposing a temporary salary freeze on any contracts signed during the next year. The idea appeals to Senate President Steve Sweeney and Assembly Speaker Sheila Oliver, who seem to realize voters are on the verge of a tax revolt.
The weak link in this effort is local governments and school boards. Most of them have signed contracts that are too generous. To get a pay freeze now, they’ll need to pressure the unions to reopen contract talks by threatening layoffs, a tough move most have been unwilling to take so far.
Sticks and carrots are called for here. The state could withhold aid to local governments and school districts that don’t move to contain labor costs.
And it could change the rules to strengthen the hand of local officials. That would mean suspending binding arbitration for police and fire. And it would mean giving school boards the power to impose final settlements, which was revoked in 2005 under former Gov. Jon Corzine.
Defying reality
Unions will treat this as a life-and-death fight. They will spend millions on radio and TV ads and bumper stickers. They will mobilize lobbyists. They will activate their fleets of volunteers.
Many of the local unions, especially the militant NJEA, are likely to opt for layoffs rather than reopen contracts they believe to be sacrosanct. Then they will blame the reduced services and larger classrooms on the politicians and vow political revenge.
The unions will argue this drive amounts to an assault on police officers, firefighters, teachers, and social workers.
Don’t fall for that.
We all have known public workers who are dedicated, sometimes heroic. They have our gratitude. And no one wants to see layoffs, especially now.
But we can’t afford these spiraling costs. It’s that simple.
Freezing salaries should be just a first move, because the broken bargaining rules have turned the public sector into a reality-defying alternate universe.
Three retiring Parsippany cops recently walked out the door with a total of $900,000 in banked sick and vacation time. And hundreds more are poised to cash in similar amounts. Parsippany cops get eight days off with pay when they get married. Union City employees are given a paid holiday to go Christmas shopping each year. Hoboken officers get a paid day off when they donate blood.
Taxpayers need a timeout from all this, and new, fairer rules in the future. The guiding principle is simple: Public workers are not entitled to salaries and benefits that exceed those of the taxpayers who pay the bills.
Today in New Jersey, that balance has been lost. Police officers, teachers, and state workers all earn substantially higher salaries than the average worker in the private sector. And the gap in benefits is even wider.
The time is right
The new governor gets all this. So does the Democratic leadership. And that makes for a rare political moment.
Christie faces a budget gap of $11 billion, more than one-third of the total budget. He will have to cut state aid to towns and schools. Without reforms to reduce local costs, local property taxes will inevitably rise.
If that happens, much of the anger that’s brewing in this state will be aimed squarely at the governor, especially if he sticks with his plan to cut income taxes for the rich.
Democrats face some peril, too. They have run the show for a decade, and these costs are still spiraling out of control. If they stand in the way of reform now, they risk losing control of the Legislature.
New Jersey faces an unprecedented crisis that demands sacrifice from the unions and courage from our elected officials.
The question is: Are they up to the challenge?
Graphic:
Public vs. Private-- Average wages for state workers ( View image)
Series: Going broke-- The high cost of public workers
Tomorrow: How to fix the broken negotiating rules that are rigged in favor of the unions.
BEHIND THE NEWS
By the numbers
203,634: NJEA members, including retirees
$98 million: How much union collected in dues for year ending August 2008; a full-time teacher pays $731 a year
$25.4 million: Salaries for NJEA employees, including officers, in year ending August 2008
$4.5 million: Spending by NJEA's Political Action Committee in past five years
$270,000: Salary of NJEA Executive Director Vincent Giordano. He also gets deferred compensation, calculated when he leaves.
Pay and political contributions
Salaries
46: Districts where teachers’ starting salaries top $50,000
4.4%: Average pay increase for teachers in 2009-10
7.6: Percentage of teachers and supervisors (not administrators) who made more than $90,000 in 2008-09; includes 17 percent in Bergen, 14 percent in Passaic
$263,000: Salary of NJEA President Barbara Keshishian, who also gets deferred compensation and a state pension.
$63,111: Average teacher pay statewide
Political contributions
$522,000: Spending by NJEA’s PAC on failed reelection campaign of Gov. Jon Corzine
94: Percentage of state legislators who got NJEA contributions over the past five years
$237,400: Contributions to Democratic Assembly incumbents in 2009
$98,420: Contributions to Republican Assembly incumbents in 2009
$129,915: Contributions to Senate Democrats over past five years
$84,760: Contributions to Senate Republicans over past five years
Sources: NJEA, Record analysis of campaign finance and lobbying reports filed with Election Law Enforcement Commission, Record analysis of Department of Education data
The NJEA vs. Governor
Christie: Two
powerhouses doing
battle
Sunday, February 28, 2010
Last updated: Sunday February 28, 2010, 10:07 AM
BY LESLIE BRODY AND PATRICIA ALEX
The Record
STAFF WRITERS
The New Jersey Education Association is a
powerhouse of a union — with a massive
membership and a multimillion-dollar wallet
that it has used to press its causes, from
smaller class sizes to larger pension payouts.
It is long accustomed to getting its way.
But now, the man the union worked so hard
to keep out of the governor's office is in
charge in Trenton. Governor Christie, who
has made no secret of his disdain for the
union's perceived power and its members'
expensive benefits, has already announced a
$475 million cut in aid to schools to balance
the state budget. His nominee as education
commissioner, Bret Schundler, is a champion
of charter schools and school vouchers,
both on the union's hit list.
And last week, the Senate passed bills to rein
in pensions for new public employees,
including teachers.
The NJEA is fighting back — hard. In the past
two weeks alone, it threw $300,000 into
television and radio ads lambasting Christie's
agenda. It told members to flood state
legislators with calls and e-mails. It bought
full-page ads in the state's newspapers today
asking: "Who will speak for students?"
"When we get put in a corner, put in a box, we
can take off the gloves," said Vincent
Giordano, the union's $270,000-a-year
executive director.
The union has plenty of muscle. It has the
loyalty of nearly 204,000 members — plus
many of their families — and collects nearly
$100 million a year in dues. It is one of the
top political contributors in the state,
spending more than $1.4 million on
legislative races over the past five years.
For all that cash, Giordano said, he expects
lawmakers to give him "an open door and an
open ear."
"We do expect to be … treated with a certain
level of respect," he said in an interview.
Christie, however, is moving fast on an
agenda that the union abhors: possibly
cutting school aid next year, pushing for
higher health insurance contributions and
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pressing initiatives like vouchers and merit
pay.
He told reporters recently he expects a tough
battle.
"Believe me, the chattering class down in
Trenton will have all of their protectors of the
status quo lined up to lob the bombs in," he
said. "The teachers union is already running
radio commercials. I guess that's like their
version of the welcome wagon. 'Governor,
welcome to Trenton, here's some attack ads
on the radio.' "
One educator described the standoff
between the NJEA and Christie as "the
immovable object against the irresistible
force."
"We have a real conflict here," said Richard
Bozza, executive director of the New Jersey
Association of School Administrators. "With
the financial problems that are plaguing the
state and local districts, the issues of salary
and benefits will be a big one in all public
employment. It's the union's job to protect
its members and it's the governor's job to
protect everyone."
Union stays strong
So just how powerful is the NJEA, which
ranks as one of the largest state teachers
unions in the country?
In his spacious office across from the State
House, decorated with posters of classic
cars, Vince Giordano exudes calm
confidence. A union member for 46 years a
nd executive director since 2007, Giordano
said he's seen "skirmishes" come and go, and
the union always emerges strong.
Over time, the union won tenure, pension
plans and a law that forbade districts to
require that employees live in the community.
In 1985, it pushed successfully for an
$18,500 minimum salary for teachers, the
highest in the nation. In 2001, it won a 9
percent increase in members' yearly
pensions.
The NJEA's sheer numbers and political grit
remain formidable.
"We're as strong as we've ever been," said
Giordano. "We're not out of the ring."
No tactics are off the table in 2010, he
promised: There could be mass rallies and
job actions. The union could pull back on
contributions to lawmakers who vote against
its interests. The ads may be just the
beginning.
"We put out that $300,000 and we'll put out
tenfold if we have to, to maintain that fair
voice in the public arena," he promised.
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Giordano expressed disgust that the bills to
trim the pensions of new employees passed
the Senate with little discussion. "We're not
happy that we were disrespected," he said.
Giordano predicted that NJEA allies in the
Assembly would slow down the process. But
new Assembly Speaker Sheila Oliver, a
Democrat from Montclair, said she believed
that after ironing out some technical
problems, the package would pass in the
lower house as well.
And she said unions should not waste their
energy fighting incremental changes, since
much broader reforms are probably coming.
"The teachers are going to have to deal with
the realities of the Christie world," Oliver
said.
Schundler, a conservative Republican the
union fought hard to defeat as a
gubernatorial candidate in 2001, said he
expected to be able to work with lawmakers
to accomplish the governor's agenda despite
union opposition. Democrats currently
control both houses.
"Sometimes, legislators … fear they may not
have union support but it will ultimately be
their call," he said. "You've seen legislative
leadership express a real openness to finding
solutions to the educational challenges we
face."
What went wrong
The NJEA spent more than half a million
dollars on the failed reelection bid of Gov.
Jon Corzine, essentially trying to keep
Christie out of the State House. It says that
4,677 members volunteered to work on the
Corzine campaign.
A postmortem by an NJEA lobbyist labeled
the election result as "electile dysfunction" —
the "inability to become aroused over any of
the choices for governor" last year.
The analysis posted on a Web site critical of
the national teachers union illustrates how
hard the NJEA tried to steer voters with a
"Viva Viagra" strategy: Phone calls to its
entire membership, face-to-face contacts
with locals, a campaign office in the union's
Trenton headquarters and advertisements on
Facebook and Hulu, the online video service.
But in the end, Giordano believes, the
strategy couldn't trump the fact that Corzine
was an incumbent during a harsh recession.
In other races, the union was more
successful. Almost all of the legislative
candidates it endorsed in November won. It
usually supported incumbents, solidifying
the union's base.
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The union frequently calls on members to
testify on bills in Trenton, knock on
lawmakers' doors and flood politicians with
calls and e-mails. It encourages members to
donate to the union's Political Action
Committee by automatic payroll deduction.
The NJEA's clout spreads far beyond
Trenton. It bolsters locals at the bargaining
table by deploying 62 expert negotiators and
organizers to regional offices around the
state to give them advice on strategy and
provide extensive research on contracts in
nearby towns. From its headquarters in the
state capital, the union strives to help locals
present a unified front against their school
boards, who act individually at the bargaining
table.
Some members also serve on their
hometowns' school boards, where they
sometimes bargain with affiliates of their own
union. In Bergenfield, every current trustee
has a tie to the NJEA, either through family
members who work in the district or their
own membership in an education union
elsewhere.
School boards lost a key negotiating tool in
2003, when the Legislature heeded the
NJEA's request and took away the boards'
power to impose their "last, best offer" if a
union walks away from the table. Now
deadlocks end up before mediators.
"Mediators have a set of rules that require
them to look at surrounding districts and are
using settlements reached a year or two or
three ago" to set comparable rates, said
Bozza, of the New Jersey Association of
School Administrators. "As a result, we have
recommendations coming in that are
unrealistic given today's economy."
Statewide, teachers got raises that averaged
4.4 percent this year, even as many in private
industry dealt with salary freezes, bigger
contributions to health insurance and an
unemployment rate that has stubbornly
stuck around 10 percent.
Costs of good education
The size of teacher contracts and their
pensions have sparked fiery tirades by some
residents in a state where property taxes are
among the highest in the nation and school
taxes account for much of the local tax bill.
Trenton pays, too: State aid to school
districts accounts for $8.8 billion of the
state's current $29 billion budget.
Many educators and parents, however, argue
that you get what you pay for. They say
effective teachers deserve good
compensation, many work way beyond their
contracted hours and New Jersey c
onsistently scores well on the National
Assessment of Educational Progress, the
most reliable measure for comparing student
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achievement in different states.
But while many families are supportive of
dedicated teachers, some express frustration
with the union's hard line. Erik Torsland, an
insurance auditor in Park Ridge, praised
teachers for doing a "great job" with his
children, but expressed dismay with union
representatives' tough stances in contract
negotiations.
"People are without jobs, people are not
getting raises, people are having to pay more
for their benefits, but the unions for the
teachers, it seems like they wouldn't
consider giving anything back," he said. "I
just think that's a selfish attitude right now.
The unions need to think a little more about
the towns they're in."
The NJEA says it is sensitive to taxpayers'
financial strains. It notes that in recent years,
members increased their pension
contributions to 5.5 percent of salary, up
from 5 percent, and raised the age that
teachers could retire with full benefits to 62
from 60.
Donna Mikulka, a librarian and union
representative in Hasbrouck Heights, said
her local recently agreed to switch to more
restrictive health insurance in the middle of a
contract to save the money for the district.
"We did that in the spirit of cooperation and
trying to be reasonable," she said. "We are
grateful in this economy that we have jobs
and are getting a pay increase. That's a given.
We're not trying to be greedy."
But the union has a public relations
conundrum. Even the Democratic
administration in Washington is pushing for
more charter schools, merit pay and using
student test scores as one factor in
evaluating teachers. Many taxpayers were
peeved when the NJEA refused to sign New
Jersey's application for federal "Race to the
Top" grants in January, partly because of its
merit pay provisions. The union's protest
could hurt the state's chances for up to $400
million for school reform.
"Part of the problem for the NJEA … is they
woke up and found out all this stuff they
opposed was mainstream," said Derrell
Bradford, executive director of Excellent
Education for Everyone, a group that
promotes school choice. "When that happens
you can dig in and you look increasingly out
of touch and lose credibility, or you can
change. What seems clear is these guys aren't
interested in doing the second thing."
Assemblyman Michael Patrick Carroll is one
of the few state legislators who never
accepted a donation from the NJEA; he sent
back its check. The Morristown Republican, a
fiscal conservative, said more of his
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colleagues have come to the view that public
employee benefits need to be scaled back.
"I was viewed as a right-wing crank, but now
it's mainstream," he said. "The crisis has
grown to such a stage that not even the
NJEA's most ardent supporters can ignore
this anymore."
Sen. Richard Codey, D-Essex, who was one of
the top beneficiaries of the NJEA over the last
five years, with $15,500 in campaign
contributions, said the latest challenge to the
union's power could "strengthen them
because they are energized."
But Christie spokesman Michael Drewniak
said the union can't stop pension and health
benefit reforms.
"We are just dealing with a fiscal reality that
the [NJEA] seems to be ignoring in its own
self-interested way," Drewniak said. "They
seem to be on the wrong side of history in
not recognizing what the public seems to
recognize ... there is a momentum they can't
change."
Back in Giordano's office, he's gearing up for
a busy four years.
"We are not going to simply turn the other
cheek all the time," he said. "When the
politicians get out of education, we'll get out
of politics."
-- Staff Writers John Reitmeyer and Herb
Jackson contributed to this article.
Locking horns with elected officials
1977: NJEA endorses Democratic Gov.
Brendan T. Byrne, who is politically
vulnerable after imposing the state’s first
income tax to increase school aid. Union
takes partial credit for Byrne’s surprise win.
1985: Republican Gov. Thomas H. Kean signs
a law setting a minimum $18,500 teacher
salary. Kean, who was elected by the smallest
margin in state history four years earlier
without NJEA support, receives union
endorsement for reelection, which is a factor
in his landslide win.
1991: NJEA goes all out to defeat Democratic
legislators, contributing to Republicans
winning veto-proof majorities in the
Assembly and Senate. Union outrage was
provoked by Democratic Gov. Jim Florio, who
had NJEA backing in 1989, signing a law
shifting teacher pension costs from the state
to local districts.
1992: Republican-led Legislature passes bill
putting pension burden back on the state;
Florio signs it.
1994: Republican Gov. Christie Whitman cuts
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funding for teacher pensions and calls for a
pilot school voucher program in Jersey City.
Some 25,000 people turn out in Trenton to
protest the cuts, but most are enacted.
Voucher plan dies without ever being
considered in the Legislature, however.
1997: Whitman and Republican-led
Legislature borrow $2.8 billion to shore up
the pension system after years of increased
benefits and lower contributions from the
state. NJEA supports the bonding, remains
neutral in governor’s election and Whitman
wins second term.
2001: Republicans and Democrats in
Legislature vote overwhelmingly for new
pension formula that provides 9 percent
increase in retirement payments for
employees and retirees. A fiscal analysis says
the $5.2 billion cost can be paid from
"surplus assets" in pension accounts, but
that analysis is based on old stock values
that had already declined and would plummet
as "dot-com" bubble burst on Wall Street.
2003: Democratic Gov. Jim McGreevey,
elected in 2001 with NJEA working to defeat
Republican opponent Bret Schundler, signs l
aw removing the ability school boards had
for 35 years to impose their "last, best offer"
on unions that walk out of negotiations.
2006, 2007: Despite tight budgets,
Democratic Gov. Jon Corzine makes it a
priority to resume regular contributions to
pension system that McGreevey and Whitman
avoided.
2008: Corzine delays signing a bill the
Legislature passed in June that tightens rules
for post-retirement medical benefits. NJEA
asked that law go into effect after the new
school year begins, allowing more people to
qualify.
2009: NJEA endorses Corzine and spends
heavily to promote his reelection, but
Republican Chris Christie wins, names
Schundler education commissioner and calls
for vouchers and pension changes.
— Herb Jackson
