N.J. Legislature to vote on arbitration-award cap

TRENTON New Jersey Democrats are pushing a proposal through the Legislature to extend a cap on pay raises for police and firefighter unions set to expire at the end of the month.

But Republicans, who have championed the 2 percent cap as a key tool in slowing the growth of property taxes, say the bill includes provisions that would render the 2010 law useless.

The cap applies to an increase in base salaries for police and firefighter unions that decide to enter arbitration.

Gov. Christie has said property taxes grew an average of 1.7 percent last year, down from an average of 7 percent in the 10 years before he took office. The interest-arbitration cap took effect at the same time as a 2 percent cap on property-tax growth.

The law sunsets April 1. The bill advanced Monday by Assembly and Senate committees would extend the interest-arbitration cap through 2017. Savings achieved through increased employee contributions toward health premiums and reductions in force would go toward salaries, though raises would be limited to 3 percent in such cases.

The bill, sponsored by Speaker Vincent Prieto (D., Hudson) and Senate President Stephen Sweeney (D., Gloucester), is scheduled for a vote Thursday before the full Assembly and Senate. Christie has said he wanted to make the existing law permanent.

"This bill is a cap-killing bill masquerading as a cap extension," Assemblyman Declan O'Scanlon (R., Monmouth), who sits on the body's budget committee, said in a statement after the 8-2-2 vote.

Crucially, Republicans say, the bill would exempt contracts negotiated under the 2 percent cap since the law took effect.

"Since we have negotiated for three years under the 2 percent cap, and most contracts are for three or four years, there will be very few contracts that haven't already been subject to the previous cap," O'Scanlon said.

That means costs could outpace revenues, particularly on property taxes, he said.

Democrats say the bill strikes a fair balance between towns and workers. It would "level our playing field," said Assemblyman John J. Burzichelli (D., Gloucester), who is vice chair of the Budget Committee.