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.