The following Editorial appeared in the February 9, 2010 edition of the Atlantic City Press at www.pressofatlanticcity.com
Reining in property taxes / Tackle arbitration
The latest poll shows voters believing Gov. Chris Christie will be judged on whether he can rein in property taxes. No surprises there: Poll after poll shows that the biggest issue for New Jersey voters is their property-tax rate. Politicians from both parties and all levels of government vow they want to do something about it.
So why isn't there a bill in the state Legislature that would address what the state League of Municipalities considers its No. 1 issue regarding high property taxes - binding arbitration? Christie, too, doesn't seem to be making this a priority: When pressed about his view of binding arbitration, he's said he won't eliminate it but might consider some tinkering.
Sure, binding arbitration sounds obscure and technical, one of those arcane collective-bargaining terms that cause the public's eyes to glaze over. But it is a real cost-driver in property taxes. It is one reason that police and fire departments represent such a big chunk of most municipal budgets, that police salaries are often by far the highest salaries in a community, that police and fire benefits and perks represented some of the most shocking excesses documented by the State Commission of Investigation in a recent report.
Not coincidentally, police and fire unions are a powerful force in Trenton. And they are the only employees subject to binding arbitration.
Under binding arbitration, a state-appointed arbitrator can be called in during an impasse in negotiations. The arbitrator then has the power to impose a contract after considering the guidelines containing in state law.
Those guidelines have long favored public employees over taxpayers. The state League of Municipalities has pounded this issue in the Legislature for years, with marginal success. In 2007, the law was changed so that an arbitrator could consider the municipal budget cap in making an award. But, according to the league, that's had little to no impact on arbitrator's awards.
The problem is that arbitrators put too much weight on comparibility - that is, looking at what surrounding communities are getting. The league wants greater weight put on cost of living and taxpayers' ability to pay. The total cost of the arbitrator's award - including longevity and other increases - should not exceed the cost of living, according to the league.
Makes sense. And the problem goes beyond police and fire personnel.
Once a hefty raise is given to public-safety employees, municipalities can have a tougher time negotiating smaller raises with other employees' unions.
These are the kinds of issues that are driving up property-tax bills. We urge local legislators to introduce a bill that would address these concerns - and let the public debate begin.