Thursday, June 19, 2014

NJ Legislature Approves New Arbitration Award Cap

New Jersey State Senator Michael Doherty (R-23) praised the New Jersey Senate's approval of new legislation, A-3424, capping the annual salary increases that may be awarded by arbitrators during contract disputes between public employers and their police and fire departments.

"Arbitration caps limiting salary increases are a critical element that make possible New Jersey's two-percent property tax cap, which has succeeded in drastically lowering the rate of property tax increases in recent years," said Doherty. "Without this agreement, we'd likely return to the massive annual property tax increases of the McGreevey and Corzine years."

In an editorial emphasizing the success of the cap and supporting the new legislation, the Star-Ledger noted that, "there's no disputing the [property tax] increase has slowed. Average property tax bills rose just 1.7 percent in 2013 and, from January 2011 to September 2013, average municipal contract raises were their lowest in decades."

Doherty was a prime sponsor of an earlier version of the legislation, S-1869, that would have extended the previous interest arbitration cap law through 2017.

That legislation, approved by both houses of the Legislature, was conditionally vetoed by Governor Christie and returned to the Legislature with changes. Although the Senate immediately adopted the Governor's recommendations, the General Assembly refused to reconsider the bill.

"It was disappointing that it took so long for everyone to come to agreement on an arbitration cap bill to protect property taxpayers, and although the new version isn't perfect, I'm glad we're finally getting it done," added Doherty. "Budget and arbitration caps are effective, and they represent a rare instance where our laws give taxpayers, rather than public employee unions, the upper hand."

The legislation now heads to the Governor's desk.

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