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Binding Arbitration Still Needs Reform

It’s hard to spin a contract agreement that will cost county taxpayers an additional $175,000 a year as financially prudent.

That is exactly what several county legislators did, however, after approving a four-year contract recently between the county and the Deputy Sheriff’s Association. The contract comes with 2 percent pay increases in 2013, 2014, 2015 and 2016. It also covers 2012, but there was no retroactive pay increase for that year. The contract also includes some modifications to health insurance benefits, including a high deductible plan.

The contract isn’t necessarily unfair. Some taxpayers would want a contract with no pay increase, but that is unrealistic. We will never know if county negotiators could have done better in this negotiation, however, because the county was operating at a disadvantage. Holding out for a better deal can be a pretty pricey gamble when dealing with a bargaining unit that has the power of binding arbitration behind it.

Several legislators who spoke publicly after approving the contract mentioned the very likely prospect of not reaching a deal with the Deputy Sheriff’s Association and having the contract mediated and imposed upon the county. In their view, the $175,000 the contract will cost each year was likely less expensive to taxpayers than continuing negotiations and trying to work for a better deal. It was no longer financially advantageous to the county to wait.

Gov. Andrew Cuomo approved some changes to binding arbitration last year by establishing a new ability to pay standard which arbitration panels must consider for 70 percent of their decision on contracts, including specifically considering the requirements of the state’s 2 percent property tax cap.

Those changes to the arbitration system are a step in the right direction, but reaction from county legislators shows they obviously don’t go far enough. The sheer possibility of going to arbitration is still enough to bring negotiations to a close – at a detriment to taxpayers. It is a clear signal that local negotiators still believe binding arbitration is tilted against them and proof the system still needs to see fundamental change.

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