A Fresh Start On Binding Arbitration

Two weeks ago in this space we expressed encouragement at renewed efforts at cooperation by Newtown’s budgetmakers on the Board of Education, the Board of Finance, and the Legislative Council. Keeping the town in good financial shape requires the kind of timely and complete communication the various board members promised each other last month. The impact on taxes of all these efforts, however, is equivalent to lining up penguins on the surface of an iceberg when compared to the so-called “fixed costs” of salaries and benefits negotiated under Connecticut’s binding arbitration laws. These costs constitute the great mass of expense that lies below the waterline of every municipal budget in the state.

Once again, the state legislature is going through the motions of studying binding arbitration reform. The General Assembly’s Program Review and Investigations Committee is conducting hearings on the issue. Last week it heard another urgent plea from the Connecticut Conference of Municipalities (CCM), which is headed this year by Newtown First Selectman Herb Rosenthal. The CCM has been arguing for years that decisions by state arbitrators on local union contracts have amounted to unfunded mandates requiring local taxpayers to pay for ever-increasing contract awards settled by a system of negotiation skewed by the threat of arbitration over which local elected officials have little or no influence.

In 1992, state lawmakers made some changes to the Municipal Employees Relations Act and the Teacher Negotiation Act that gave local legislative bodies limited powers to reject arbitrated awards and made some concessions to towns and cities in the formula that determined a municipality’s ability to pay for arbitrated contracts. But even with these reforms, arbitration awards rejected by local legislative bodies would return to yet another arbitration panel for a final decision.

CCM is asking the General Assembly to allow the towns to use a system similar to what the state has approved for itself. That system would give negotiators a “fresh start” by reopening talks for more negotiation and compromise rather than submitting rejected contracts for another binding and final decision by arbitrators. The CCM’s proposal would also allow local rejection of “stipulated agreements” between school boards and teachers on certain issues within a negotiated pact, which effectively take those issues off the table when the contract is considered by the local legislative body and arbitrators.

A survey released last week by the American Federation of Teachers showed that Connecticut’s teachers are the highest-paid in the nation, with an average salary in 2003-04 of $56,516, up 4.7 percent from the year before. The state’s taxpayers can thank our current binding arbitration laws for that distinction.

We are all for rewarding excellent educators with excellent salaries and benefits, but we think the people who pay for those rewards need a greater role in their allocation. This is especially true in Newtown, where voters no longer seem to have any choice in who sits on the Board of Education, which negotiates the contracts that account for the “fixed costs” that make up 75 percent of its annual budget. Let’s all hope state legislators are swayed this year by CCM’s logic and give Connecticut’s towns and cities a fresh start toward bringing greater balance to local contract negotiations.