The following op ed appeared in
the Waterbury
Republican Newspaper on Sunday, Jan 21, 2007
Public debt, mandates handicap state
By
Susan Kniep, ( fctopresident@aol.com) President of the
Federation of Connecticut Taxpayer Organizations Inc.
Connecticut is awash in
debt. Gov.
M. Jodi Rell’s November 2006 Fiscal Accountability
Report reads: “The state faces significant long-term obligations including
debt, unfunded pension liabilities and unfunded post-employment retirement
benefits which are estimated to exceed $49 billion in total.”
As Democrats in the legislature are trying to wrest control
of the Bond Commission from Gov. Rell, they have left
taxpayers with the largest per capita bonded debt in the country, $14.2
billion. As Gov. Rell tries to exert control over the
state’s “candy store,” Democrats are flexing their muscles to add more
pork-barrel spending, such as $14 million for a new bridge to an isolated beach
and $1.5 million for a Jaguar exhibit at a zoo.
The state is projecting deficits in each of the next three
fiscal years, and in 2007-08, the budget is on course to exceed the spending
cap by $800 million. With borrowing exempted from the cap, many legislators
perceive bonding as free money, until they have to factor in principal and
interest payments to the state’s annual budget. By the time this $14.2 billion
debt is paid, it is anticipated taxpayers will have paid $5 billion in
interest.
Connecticut has the second highest property taxes in the
nation, trailing only New Jersey.
With the impact of revaluation, many will lose their homes because of their
inability to pay their property taxes which have become taxes on unrealized
capital gains. Further, with the downturn in the real-estate market, home
sellers may get far less than the value of the homes on which they are paying
property taxes.
Nationally, taxpayers are lobbying their legislators to
adopt a Taxpayers’ Bill of Rights (TABOR) to bring fiscal austerity,
accountability and integrity to the government and constrain their tax burden.
The Federation of Connecticut Taxpayer Organizations Inc.
(FCTO) is proposing a TABOR that addresses to bring fiscal accountability and
safeguard the interests of property owners from eminent-domain abuse. The goal
is to bring these issues to the forefront until November 2008, when the state
is constitutionally required to ask voters whether they want to amend the state
Constitution.
From property taxes to education to revaluation to
government-sector employees and beyond, legislators tell the leaders of Connecticut’s 169
municipalities what they can and cannot do. If the state doesn’t provide
funding to a town to sustain these mandates, the cost is borne by property
owners through increased property taxes.
With as many as 85 percent of property taxes paying for
salaries, health care, pensions and other labor costs, the most costly unfunded
mandate to taxpayers is binding arbitration, wherein an appointed arbitrator
tells a municipality what it can and cannot do as it relates to union
contracts.
When I was mayor of East Hartford from 1989-93, I refused to
accept a taxpayer- financed car and told all employees to cease driving
town-owned cars home. This
benefit was not spelled out in their contracts, but the unions grieved my instructions.
The unions won because of a little-known term called “past practice.”
In December, the Federation testified before the Governor’s
Committee on Unfunded Mandates seeking reform of binding-arbitration laws. We
urge legislators to:
■ Give local elected officials the same powers state elected
officials have to better control their labor costs.
■ Prohibit unions from accessing a town’s savings when negotiating
contracts.
■ Give towns the right to suspend binding arbitration for up to
three years when affected by negative economic conditions.
■ Remove the veil of secrecy from contract negotiations. Taxpayers
pay for union contracts. They should have every right to follow negotiations
and comment on terms being negotiated before contracts are adopted. In
fact, as union members vote on contracts, taxpayers should be allowed to vote
as well.
Most residents work in the private sector, under “at-will” conditions wherein
they can be terminated at any time for any or no legal reason. They work in a
state of flux, knowing their employer on any given day can demand they pay a
greater share of their health-care premium, take on a greater workload or have
their pay cut. There will be no debate, no bargaining, no arbitration and no
elected official waiting to defend them.
By contrast, state and municipal workers have a state-given
right under arbitration to force negotiations and push their agendas behind
closed doors. Unions vote to accept or reject their contracts. Taxpayers have
no say; they are presented their property tax bills to fund these lucrative
contracts. Meanwhile, our part-time legislators are promoting wage increases
for themselves as they force us to pay higher property taxes.
Residents should make their voices heard at the legislature
for property tax reform and to secure their property rights from eminent-domain
abuse.
Susan Kniep ( fctopresident@aol.com) is president
of the Federation of Connecticut Taxpayer Organizations Inc.