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LIMBA Steve Levy- Center for Cost Effective Government
October 4, 2013 @ 12:00 am EDT
Our speaker this morning at LIMBA was former County Executive Steve Levy. Steve established the "Center for Cost Effective Government" for the purpose of "preventing municipal government from going over the cliff."
Levy described the current problems as two parts. Revenues are reduced and expenses continue to rise. Revenues will again rise in the future, but the revenues will be constantly lagging increasing costs, according to Steve.
Levy sees the biggest hole in the bucket being personnel costs. He states the problem is not just that municipal salaries are high, pensions and work rules are really killing the goose.
Pension funding is based on market fluctuations. The "guaranteed benefit" plans that are in place:
1) Dictate that the taxpayer needs to reach deeper into his pockets when the stock investments under-perform. Ironically the taxpayers are also hurting from their own losses.
2) Overtime in the final years of employment increases the pay-out, instead of basing the payout on the regular salary. "That is why we see enormous pension payouts"
3) 20 year retirements mean we can conceivably be paying a police officer that came on the force at age 22 and retiring at 42 another 40 or more years.
4) Mandatory arbitration. Arbitrators are hired by the unions and always find for the highest increase in order to get re-hired again.
5) Work rules. -Vacations, holidays, paid sick leave, and personal days amount to 100 days. If you add in weekends they are working less than half as many days as there are in the year.
6) Step increases- (Tri borough Agreement) Step increases are not part of the union negotiations. If the contract expires, the step increases continue. This takes the pressure off the union to negotiate.
7) Disability retirements increased 648% since 1959 Levy finds this rate of disability very suspect since we have safety programs that were unknown in 1959, including OSHA legislation. Fraud in LIRR retirements is the most visible example, but we must examine the rest of the municipal workforce.
Beyond that Levy asserts that we are an enormous regional population that gets short-funded from Albany and Washington. New York City has 9 million people and garnered $30 billion in federal funds. We on Long Island celebrate if we get a few hundred thousand and we have 3 million people. "If it were proportional we would be getting $10 billion."
Mr. Levy came to us armed with many facts and examples for the audience to question, and they did.