July 9, 2008
Honorable David Paterson
Governor
State Capitol
Albany, NY 12224
Dear Governor Paterson:
In what has become an
annual ritual in the days before adjourning, the State Legislature passed four bills
providing pension benefit enhancements to state and local government employees
and locking-in health benefits for retirees. All of these bills unnecessarily
increase or reinforce the burden on New York State taxpayers by making already-generous post-employment benefits even
more generous and costly. Consistent with your pledge to ease the burden on
local taxpayers, you should veto each one of these bills. Furthermore, you
should declare a moratorium on all “pension sweeteners” and other initiatives
that force government employers to pick up the tab for costly new entitlements
and benefit enhancements.
The reports and
recommendations recently presented to you by the Commissions on Local Property
Tax Relief and Local Government Efficiency affirm that there is a direct
connection between high local taxes and State mandates. As measures to limit
local taxes by capping school district increases and consolidating services are
considered, State leaders must come to grips with their contribution to the
problem. The enactment of these benefit enhancements – often over the objection
of local governments – are symbolic of the counter-productive state-local
relationship that must be ended if New York State is to become a more effective
competitor for the businesses and residents that can propel us to a more prosperous
future.
For these reasons, we
ask that you veto the following four bills.
- A.9393/S.6457A, the subject of a separate
letter sent to you on June 26, would tie the hands of local managers in
dealing with rising health insurance costs for retirees and would establish
a statutory precedent that can be perpetually renewed on an annual
basis. This would represent a
serious encroachment by the State into local labor relations; jurisdictions
around the State would contend with more limited managerial authority just
as the school districts have for every year since their annual prohibition
was enacted.
Three additional
bills would augment already generous public pensions (see our 2006 Report Old Assumptions, New Realities: The
Truth About Wages and Retirement Benefits for
Government Employees) for police and firefighters:
- A.10016/S.6703 would roll back judicial
limitations on improved disability pensions awarded through “heart bills”
that create the presumption of on-the-job injury for heart-related
disabilities or deaths to police and firefighters. These
judicial rulings reasonably require that an employee submit proof of an
actual accident or notice to an employer; this legislation would roll back
these requirements and increase costs by at least $14.3 million
annually.
- Two bills, A.10252A/S.7990 and
A.10508/S.7332A, raise the mandatory retirement
age for police and firefighters, allowing those retiring from service in
one force to join a second and qualify for another full public pension.
These last two bills
are accompanied by estimates that they will be cost-free to the affected
governments; but previous experience and recent controversy have demonstrated
that the fiscal notes on these bills can be unreliable. These types of enhancements almost always
bear an incremental cost, a cost that becomes fixed for the long-term, as
pensions benefits can never be reduced or mitigated once granted. Furthermore, granting these benefit
enhancements for particular groups of uniformed workers perpetuates an uneven,
politicized system in which pension costs inch ever upward, as other groups
strive to gain the same improved benefit.
You can and should put
an end to this cost creep by vetoing these bills and calling for a moratorium
on pension sweeteners and related measures.
Such action would be a strong signal that you intend to change the
state-local relationship for the better.
Thank you for
considering our recommendations.
Sincerely,
Carol Kellermann
President
