Trenton must give Mayors more powers to protect property taxpayers and prevent layoffs

Statement by Mayor Eldridge Hawkins, Jr.

On Thursday, October 14th, I spoke at a news conference in Trenton calling for reforms to protect property taxpayers and prevent layoffs. Later in the day, I testified at two State Senate Hearings on the same subject.  I am a leader in the campaign by New Jersey’s urban mayors and the League of Municipalities to create a “toolbox” of new laws to help solve the serious financial problems faced by our cities and towns.

With Governor Christie’s cut of $3 million in state aid and a 2% cap on property taxes, Orange faces an unprecedented fiscal crisis. If there are no basic changes in state laws, we can expect layoffs and a reduction in services so severe that even police and fire protection will not be spared.

I wish that we could deal with the fiscal crisis by simply cutting spending in Orange to make up for the loss of state aid. But we can’t. Most local spending is outside of our control.  Almost 95% of our city budget consists of salary or salary related items awarded through binding arbitration, plus expenditures such as debt service or state mandated programs that a Mayor cannot control.

Since I took office, I have been able to reduce the number of city employees by 22 and to save taxpayers $2.3 million through staff reductions and reorganization.  But this is not enough to prevent the layoffs that will be forced by property tax cap and the refusal of our unions to agree to the spending and benefit cuts necessary to prevent union members from losing their jobs.

The only way mayors can prevent layoffs while the state is cutting back is to give our cities and towns the power to control the vast majority of our spending that is now off limits and beyond our reach. We need a tool kit of powers at the local level to bring our labor costs and work rules in line with those of private industry. Unfortunately we are stuck with a binding arbitration process and civil service rules that force layoffs and prevent Mayor’s from reducing spending with minimum damage to services.

Binding Arbitration Reform is needed to prevent layoffs. Most public employees are dedicated and work hard. They are entitled to salary increases when the public can afford them.  But, they are not entitled to salary increases imposed by arbitrators who totally ignore the consequences of their decisions on taxpayers and on the ability of cities to deliver services.

In Orange, we are in labor negotiations that will require significant salary and benefit reductions in order to avoid massive layoffs.  If this goes to binding arbitration, any increase whatsoever will cause additional layoffs. It is important that Governor Christie and the legislature require arbitrators to take into account the impact of their decisions on property taxes and city services.

We also need civil service reforms to prevent chaos when local governments are forced to reduce the number of employees.  In today’s economic crisis, government must become leaner, smarter and more cost-effective. Civil service rules make this extremely difficult. They make it nearly impossible to fire incompetent employees and to keep our best.

All cities have a few long time employees with high titles and high salaries who are cruising along without seriously doing their jobs, while mistreating citizens and working incompetently. For the benefit of taxpayers, when layoffs are necessary those are the ones who should lost their jobs first. Instead, because of civil service rules, we must keep the worst, most senior and most highly paid and get rid of our best. This reduces the savings to taxpayers.

Governor Christie and the legislature are forcing cities to downsize. Now they must give Mayors new laws to protect taxpayers and services. Give us arbitration reform to minimize the number of layoffs and give us civil service reform so that in reducing our workforce we can keep our most productive employees and get rid of our least productive.