NJ unions open to budget compromise

March 8, 2009 5:04:51 PM PDT
New Jersey's public employee unions would agree to forgo their 3.5 percent wage increase in the coming year if Gov. Jon S. Corzine drops a plan to save money by furloughing the workers for 12 days, according to two state officials with direct knowledge of the budget. The officials, who spoke on condition of anonymity because no agreement had been struck, said the unions would consent to the wage giveback in exchange for a promise from the governor not to require the state work force to take one unpaid day off each month beginning in July. The unions also would want assurances from the governor that no layoffs would occur, the state officials said Sunday.

Bob Master, political director of Communications Workers of America District 1, the largest of several state worker unions, confirmed Sunday that the unions were open to compromise, though he would not specify what they're willing to give up.

"What we have said quite clearly is that state workers are prepared to do their part in getting the state through this economic crisis," Master said.

The governor's office declined to comment Sunday on the unions.

Corzine, a Democrat, will propose a budget of around $29 billion on Tuesday. Over the past several weeks, he's made it clear the state's finances are in dire shape and he wants concessions from the unions to help close a multibillion-dollar budget gap.

The governor is looking to save $260 million by having state employees relinquish the negotiated pay raise due to take effect with the new budget on July 1. He already has frozen wages for nonunion workers. He would save another $240 million by furloughing workers for 12 days.

The furloughs would affect 80,000 state workers, including state police and correction officers, if applied across the board, but Corzine has said the furloughs would be "managed" so public safety is taken into account.

The administration has put the value of pay raises and furloughs at the equivalent of 6,000 to 7,000 state workers' annual salaries and health benefits. Corzine said he would resort to layoffs of professional staff and office workers if he can't get cooperation from the unions.

The unions have resisted reopening their contract, which goes through June 30, 2011.

"We don't think it's particularly helpful to engage in threats and ultimatums, which is how we view what the governor has been doing," Master said.

Though the unions have questioned Corzine's authority to order furloughs and wage freezes, Senate Majority Leader Steve Sweeney, a Democratic ironworker union leader from Thorofare who has disagreed with the unions, said the state worker contract can be reopened in a financial emergency like the one New Jersey faces.

However, the administration on Sunday disputed reports that Corzine is preparing to declare a fiscal emergency to broaden his executive powers over the unions.

"The press reports about the governor planning to declare a state of emergency are false," Corzine spokesman Rob Corrales said Sunday. "The governor already has the tools needed to help him confront the state's fiscal crisis head on, and that's exactly what he will do on Tuesday, when he will propose a balanced budget."

New Jersey's Constitution requires the governor to keep a balanced budget. That's why Corzine has proposed hundreds of millions of dollars in midyear cuts to compensate for declining revenues.

Other key elements in Corzine's budget, according to the state officials, include cuts in property tax rebates to all but senior citizens and low-income wager earners; additional taxes for those making more than $250,000 a year; more taxes on liquor and cigarettes but not beer; and slight reductions in municipal and school aid.