By: centraljersey.com
Despite numerous meetings seeking contract concessions that would result in economic savings, the labor unions representing township employees have remained firm in their refusal to open up their contracts.
Municipal Manager Richard Krawczun is preparing the 2011 township budget for presentation to the Township Council later this month.
He has met with the Fraternal Order of Police, Lodge 209, four times and twice with the unions that represent the white collar and blue collar workers and supervisors in the last few weeks, but none has stepped forward to make concessions, he said.
"The four nonpublic safety unions indicated some willingness to consider some concessions, but only if all employees were going to share (in the givebacks)," Mr. Krawczun said.
When it appeared that the police union was not willing to open its contract, the initiative fell apart, he said.
Although the meetings with the FOP resulted in "a very productive conversation," the union was unwilling to open its contract which expires in 2012, he said. The police union’s position is that its members had already made concessions when their contract was negotiated last year.
The police officers – from the rank-and-file patrol officers to the sergeants, lieutenants and the captain – agreed to contribute 1.5 percent of their salary toward health insurance premiums. They also agreed to a wage freeze for 2010, and salary increases of 2.8 percent for 2011 and 2012.
The white collar, blue collar and supervisors unions had agreed last year to contracts that called for a wage freeze in 2010, and salary increases of 2.6 percent in 2011, 2.7 percent in 2012 and 2.5 percent in 2013.
The unions also agreed for the membership to contribute 3 percent of the cost of their health care premiums in 2011 and 2012, and 3.2 percent in 2013. Union members who retired after Feb. 1, 2014 must contribute 1 percent of their pension toward the cost of their health benefits, but employees hired in 2010 will not be entitled to health benefits at retirement.
And they agreed to cap accumulated sick leave – sick days they did not use – at $10,000 for employees hired in 2010 and later. Workers hired prior to 2010 would receive up to $15,000 for the value of their unused sick days.
Given the concessions they made when their contracts were negotiated and approved last year, Mr. Krawczun said, "the unions felt it would not be in the best interests of their members to open up their agreements."
Mr. Krawczun pointed out that the union contracts are only one piece of the puzzle in crafting a budget for 2011 and the resultant property tax rate to support it.
A new state law caps the municipal property tax rate increase at 2 percent over the prior year’s tax rate.
"The reality is, the 2 percent cap, an anticipated reduction in the available surplus fund and the continued battering we are receiving from property tax appeals are creating an extraordinarily difficult fiscal time," he said.
Mr. Krawczun cited a continuing drop in the ratables base – the value of all property in the township for property tax purposes – plus a "significant" decrease in surplus funds and a greater number of properties whose owners have filed tax appeals with the Mercer County Board of Taxation.
There will likely be an increase in the appropriation for the reserve for uncollected taxes, as well as increases in pension and health care costs, he said.
The reserve for uncollected taxes has money in it to pay the school property tax and the county property tax.
The municipality collects property taxes and distributes the money to those entities first, and then to itself.
"The current fiscal information we have and the new limit on the property tax rate levy will require me to make some recommendations to Township Council for 2011 which will need to contain deep reductions in municipal services and/or personnel," he said.
Mr. Krawczun said that while the administration is examining all possible alternatives, it must be "extremely cautious" not to mortgage the township’s fiscal future.
It is necessary to blend the solution to the problem over a couple of years and not create a situation "budgetarily" that will be much worse going forward, he said.
"In the past, looking ahead always involved future estimates for 3 to 5 years, but the conditions are such that the horizon has to be tightened – but not to lose sight of the long-term impact that short-term decisions could cause or create," the manager said.

