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STATEMENT BY

 

From The Federation of Connecticut Taxpayers

 

Susan Kniep, President

 

September 9, 2017

 

Today, Connecticut taxpayers are facing a near $6 Billion State Budget Deficit and a $74.3 Billion State Debt primarily due to State Mandates such as BINDING ARBITRATION AND COLLECTIVE BARGAINING STATE LAWS!

 

The majority of this debt is due to what was promised to State retirees for both pensions and healthcare costs. Today, some state retiree pensions well exceed $100,000, $200,000 and have reached $300,000.

 

Click on the heading of the following article to learn more.

Many State Retiree Pensions Exceed 200,000 DOLLARS

The State Debt has reached 74.3 BILLION DOLLARS. State Labor Union Contracts are being negotiated in secret.
The Federation of - Taxpayers - April 2017

 

 

These two state laws have also driven up local property taxes to among the highest in the country as Connecticut Town Officials and Boards of Education negotiate public sector union contracts with their town employees, teachers, and fire and police personnel.

 

The fiscal problems of the State of Connecticut and its capitol, the City of Hartford, as both teeter on the edge of Bankruptcy, can only be contained by

Ending collective bargaining would be opportunity for reform | The CTMirror.org

The aforementioned article was written in 2011. Little has changed since then. These two laws remain on the books today and are the cost drivers of state and municipal budgets. The irony is that for some taxpayers, their town officials who sit on local legislative bodies and approve these contracts are themselves public employees, state or federal.

As I noted within my 2011 article

In 2010, the Milwaukee Teachers Education Association claimed sexual discrimination through the courts in an attempt to have taxpayers fund nearly $800,000 dollars for drugs that treat erectile dysfunction.

In March, 2011, unions in Orange, Connecticut won a grievance requiring taxpayers to provide them with free coffee and milk.

As many Americans struggle with their own healthcare costs, their elected officials throughout the country have signed contracts to provide healthcare benefits to government retirees at a cost to taxpayers of $1.5 trillion.

The aforementioned are examples of the negative impact municipal and state unions have on taxpayer-funded budgets which become burdened with the costs of litigation, the drug Viagra, coffee, and gold plated healthcare plans. Continue reading at https://ctmirror.org/2011/04/14/ending-collective-bargaining-would-be-opportunity-reform/

 

THAT WAS THEN AND THIS IS NOW!

YET LITTLE HAS CHANGED

STATE BINDING ARBITRATION AND COLLECTIVE BARGAINING LAWS ARE NOT ONLY BANKRUPTING THE STATE BUT THE TOWNS AS WELL.

 

Approximately 75% to 90% of the local budgets of Connecticuts 169 Towns are dedicated to personnel related expenses for Town and Board of Education employees.

PUBLIC SECTOR UNION CONTRACTS ONCE SIGNED AND SEALED BY BOTH PARTIES, THEN BECOME LEGALLY BINDING CONTRACTS.

TAXPAYERS MUST FUND THESE UNION CONTRACTS REGARDLESS OF THE ABILITY OF THE TAXPAYER TO PAY! ON THE LOCAL LEVEL, THIS CAN THEN RESULT IN TAX LIEN SALES IF LOCAL LEGISLATIVE BODIES INCREASE PROPERTY TAXES BEYOND THE ABILITY OF PROPERTY OWNERS TO PAY!!!

 

And that scenario may play out in the State of Connecticut and its towns within the next few days as noted by

 

Republican Senator Toni Boucher who puts the approval of the State Employee Union Contracts by State Democrats into perspective

 

A Sad Day for Connecticut Taxpayers

State Senator Toni Boucher (R-26) today called the legislatures vote approving the union concession package a sad day for the state of Connecticut.

By voting into law the package negotiated by the Governors office, the General Assembly has taken an action that will reverberate in Connecticut for decades, Sen. Boucher said. State Senators that controlled the vote had a chance to reject this package and expand the options available to balance the state budget. Instead, we now are locked into a ten-year contract that guarantees wage increases, pension benefits, and continued employment for unionized workers no matter what financial situation the state faces in the future. This party line vote locks in increased benefit costs despite the fact that year after year budget deficits not were solved by historic tax increases. This vote virtually guarantees that these problems will continue.

Sen. Boucher said the package negotiated by the Governor and his staff produces some positive changes and includes a two-year wage freeze, but does not even get close to the numbers needed to put Connecticut on the path to financial stability. Connecticut is facing a $5.1 billion budget deficit while this union package seeks to save $1.5 billion.

Continue reading at http://ctsenaterepublicans.com/2017/07/senator-boucher-a-sad-day-for-connecticut-taxpayers/#.WbSgB4-cHcI

*************************

The following is the statement I made before the State Legislature in 2006 as it relates to the negative effects of Binding Arbitration and Collective Bargaining on municipalities. I knew this to be true as I had served as the Mayor of East Hartford from 1989 to 1993, under a town charter which established a strong mayor form of government.I also negotiated, at the time, the first no wage increase public sector union contract in the state.

Then and today, I focus on these two mandates because they do much more than simply determine wages, healthcare, and pensions for public sector unions. They also establish working conditions as I noted in 2006.

 

STATEMENT BY

THE FEDERATION OF CONNECTICUT

TAXPAYER ORGANIZATIONS, INC.

 BEFORE GOVERNOR RELLS

 COMMISSION ON UNFUNDED MANDATES

 DECEMBER, 2006

  

The following are comments made by Susan Kniep, President of The Federation of Connecticut Taxpayer Organizations, Inc. on December 20, 2006 before the Governors Commission of Unfunded Mandates.

Thank you for extending the time to me to appear before your Committee. I ask that you look at the most impacting unfunded mandate in this state which is Binding Arbitration .Due to Binding Arbitration, local officials cannot manage their budgets and every year taxpayers are forced to pay for increased costs born through union contracts.

From 1989 to 1993 I had served as the Mayor of East Hartford under a strong Mayor form of government. I had previously served for several years as East Hartfords minority leader on its town council. I am currently the President of the Federation of Connecticut Taxpayer Organizations.

 A few years ago, the Federation assessed towns to determine the percentage of personnel costs to budgets. Of the 169 Connecticut towns, we determined that taxpayers were paying between 75% and 85% of their property taxes to support government employee wages, pensions and healthcare. Taxpayers, some of whom had no health insurance, were paying 85% or more for government employee healthcare costs.

Taxpayers are impacted by local budgets which are now controlled by arbitrators passing judgment on union contracts. Not only on wage, pension or healthcare issues, but grievances as well.

During my tenure as Mayor, the State was in a recession resulting in layoffs in the private sector. Some Connecticut companies downsized, others went bankrupt. Some left Connecticut for states where taxes were less impacting.

The State and towns suffered economically, as did taxpayers. Families were impacted by lost jobs and wages. Yet, as Mayor, I could see the obvious. Those in the public sector were secure. In fact, not only were they not losing their jobs, they expected to receive wage increases.

In talking with government officials from other towns, many of us knew we had few budget choices as we were impacted by union contracts. In an attempt to control the finances of East Hartford as its Mayor, when elected to office in 1989 I relinquished the taxpayer financed automobile I was entitled to. Concurrently, I instructed that the practice of town employees driving town owned vehicles home would cease. This was done after a careful review of their contracts which did not grant this entitlement.

 I was subsequently grieved by the unions. I lost my case due to a seldom referenced term called past practice. If the union is doing something outside the realm of their contract, arbitrators have ruled they have earned the right to do it. In essence, an administrator may be allowing a practice by a union member or members to occur over a period of time which is unbeknown to the public or to other elected or appointed officials. Once discovered, there is no recourse to stop the practice which may have a dramatic financial impact on the taxpayers forced to support it.

More recently, the police chief of East Hartford had assigned a work schedule which would have a positive impact upon his budget. The union grieved and they won, again creating a financial hardship on taxpayers.

The most egregious act by the government unions was when they successfully took control of millions of dollars as a result of the Anthem stock distribution. Rather than towns being allowed to use this money to offset union healthcare costs paid for through property taxes, the unions felt entitled to the money and filled lawsuits to take possession of it. Many towns acquiesced to the unions believing the costs to litigate might exceed the benefits distributed by Anthem. As you are aware, for years many government union members paid nothing for their healthcare, while taxpayers absorbed 100% of the cost. Today, healthcare costs in the private sector are soaring while taxpayers concurrently pay for the majority of the costs of healthcare for government employees.

The Federation recognizes that Binding Arbitration will not be abolished in the immediate future although other States have done so. However, there must be reform. Taxpayers do not elect those who arbitrate a contract. The elected officials taxpayers elect however have no control over their budgets or the taxpayers dollars when 75% to 85% of their budget pay for personnel expenses and are under the control of arbitrators who have no accountability to the voter. This is an affront to the democratic process.

We urge your committee to propose to the legislature that local municipalities be given the following authority by statute:

Give local elected officials the same powers that State elected officials have. Make it mandatory that local arbitration awards be ratified by a majority vote of the town council.If, as in state government, these awards are rejected, then require the Process to begin again.

Next, take the fund balance off the table when negotiating contracts. Allow towns to build a fund balance without the threat of unions being able access this money for their members. Failure to do so will continue to force towns to bond projects because they cannot now save their money to pay for future projects.

Next, give towns the right to suspend Binding Arbitration for up to three years when impacted by negative economic conditions. I had begged the legislature to allow for this suspension when I was Mayor, but my requests were ignored.

Next, take the negotiation table out from behind the closed doors of secrecy and into the light of public debate. The taxpayers fund union contracts and should have every right to follow negotiations and comment on terms being negotiated before contracts are agreed to. In fact, taxpayers should be allowed to vote on union contracts through referendum.

In conclusion, I question why the CEOs of municipalities are forced by our State legislators to adhere to laws which prevent them from controlling their labor costs which are ultimately passed on to property owners through property tax increases.

The majority of Connecticut residents work in the private sector under at-will conditions wherein they can be terminated at any time, for any legal reason, or for no reason at all by their employer. They work in a state of flux knowing that their employer on any given day can demand that they pay a greater share of their health care premium, take on a greater workload, receive a minimal salary increase, no salary increase or have their pay cut. There will be no debate, no bargaining, no arbitration, and no elected official waiting to defend them. The words out-sourcing and visas have become a part of the Connecticut workers vocabulary as the agenda of many corporations is to put their stock at the top of the portfolios of Wall Street analysts.

The at-will employee is an unprotected class. They are losing their jobs, their homes and their health insurance. They are being forced into jobs which are below their educational and skill levels and at salaries which are a fraction of what their previous jobs paid.

Yet, the American dream is alive and well for those whom the at-will employee is forced by elected government officials to financially support. They are the state and municipal government workers. In contrast to the atwill employee, government workers do not have to accept what their employer tells them. Taxpayers are their employer. Whether it is working conditions or salary, healthcare or pension issues they exercise their State given right to force negotiations and push their agendas, behind closed doors, under state Binding Arbitration laws, which leave taxpayers powerless. Unions vote to accept or reject their contracts. Taxpayers do not. Instead, taxpayers are simply presented with the bill for these lucrative union contracts, through their property taxes.

Thank you again for your time.Taxpayers in the 169 towns and the State need property tax relief. Reforming Binding Arbitration will provide that relief.