September 7, 2003
Dear Concerned Municipal Leader:
As the former Mayor of the Town of East Hartford, I know
the impact Binding Arbitration can have on municipal budgets. I am, therefore,
writing to ask if you would consider joining other towns in proposing the
following Resolution to your local legislative body to encourage stimulating
the debate on Binding Arbitration. A Resolution has already been passed by
several towns (Tolland, East Hartford, Wethersfield, North Stonington,
Watertown, New Britain, Brookfield,
Berlin, East Hampton) and forwarded on to their legislative leaders at the
State capital.
I ask that you reflect upon the recent lawsuit initiated by a union
representing public employees. The
union is suing more than 200 cities, towns, school districts and public
agencies for a share of the stock distribution from Anthem Blue Cross. Connecticut taxpayers pay hundreds of
millions of dollars for State employee and State retiree healthcare. In some municipalities, local
taxpayers are picking up 100%, 95% or 90% of town employee healthcare
costs. Yet, a lucrative, nearly free, taxpayer financed healthcare system
is not enough for the public sector unions. They want more and now they
are going to court to get it. Revenue generated from the sale
of Anthem stock should be available to municipalities to offset operating
costs, to include the rising costs of health care for employees. It should not be used as an additional
windfall to union members who have the best healthcare the taxpayers’ money can
buy. This latest action by the unions
should serve as a catalyst for change to State Binding Arbitration Laws.
The Federation of Connecticut Taxpayer Organizations,
Inc. (FCTO) is a nonprofit organization which seeks to educate taxpayers and
elected officials on issues affecting taxation, government policies and
practices, and voter participation. Through our research, we have determined
that approximately 75% to 90% of local, municipal budgets constitute personnel
related expenses. This includes salaries, healthcare, pensions, workers
compensation, etc. We have also learned that Towns are either settling union
contracts under the threat of Binding Arbitration, or union contracts are being
sent to arbitration, and are being finalized by independent arbitrators with no
relationship to the municipality they are financially impacting.
Due to the aforementioned, FCTO believes that each of the 169 municipalities in
the State of Connecticut should be encouraging their State representatives to at
least open the debate on Binding Arbitration. In so doing, local officials,
state officials and taxpayers can become better educated on the issue, and can
collectively seek a solution to a system which deprives taxpayers and local
elected officials of the necessary authority to manage their municipal budgets
and personnel costs.
We offer the following Resolution for your consideration. Of course, you may
wish to offer your own verbiage.
Also, as we continue to research and educate the public, I
would appreciate learning from you your Town's current budget, the percentage
of your personnel related expenses to your budget, and in light of the current
lawsuit, what the taxpayers in your town are paying for healthcare costs versus
what the employees are paying. As the
data is collected, we will be posting the information on our website, along
with the status of the Resolution in each town. We believe this information
will in turn be beneficial not only to taxpayers but to municipal leaders such
as yourself as you compare the percentage of your personnel related expenses to
other municipalities.
I look forward to hearing from you. If you have any questions, please contact
me at 860-528-0323, or by return email.
Sincerely,
Susan G. Kniep
President
RESOLUTION ON BINDING ARBITRATION
WHEREAS, Connecticut
Taxpayers currently pay the highest taxes in the Nation and are burdened with
the highest bonded debt, and
WHEREAS, The State of Connecticut has been plagued with annual budget deficits,
which in turn impact local budgets, and
WHEREAS, State lawmakers continue to reduce state aid to municipalities in an
effort to lower the deficit, and
WHEREAS, the majority of the 169 towns and cities throughout the State of
Connecticut rely upon State aid to balance their local budgets, and
WHEREAS, a reduction in State municipal aid by the State legislature has a
deleterious affect upon local property taxpayers, and
WHEREAS, on average, seventy (70%) percent to ninety (90%) percent of municipal
budgets are dedicated to personnel related expenses, and
WHEREAS, independent arbitrators, with no direct relationship to
municipalities, are now the ultimate decision makers on union contracts subject
to arbitration, and
WHEREAS, municipal union contracts are disproportionate to the private sector
in wages, health and pension benefits, and
WHEREAS, the democratic
process is weakened by the present binding arbitration system which deprives
taxpayers and local elected officials of the necessary authority to manage
their municipal budgets and personnel costs,
NOW, THEREFORE, BE IT RESOLVED that the local Legislative Body of
_____(town/city)_____________________ urges our State Representatives to Open
the Debate on Binding Arbitration, which will in turn serve to educate the
public on the effects of Binding Arbitration, and provide a forum wherein a
successful resolution can be reached to allow municipal leaders and taxpayers
the ability to manage their own budgets.