Freezes salary increases and other payment increases of employees of the state for one year; authorizes municipal corporations to institute such freezes

BILL NUMBER:S4478

Title of bill

An act to amend the general municipal law and the civil service law, in relation to freezing salary or wage increases of employees of the state and authorizing municipal corporations to institute such wage freezes for their employees; and providing for the repeal of such provisions upon expiration thereof

Purpose or general idea of bill

This bill would permit local governments, by local law, and state government, to establish a wage freeze for governmental employees for a period not to exceed a year.

Summary of specific provisions

Section 1 - Legislative findings and declarations.

Section 2 - Adds new §25 to the General Municipal Law allowing any municipality to freeze and suspend all increases in salary or wages of its employees for a period of no more than one year. No retroactive pay adjustments may be made at the conclusion of the wage freeze.

Section 3 - Adds new §137 to the Civil Service Law requiring New York State to freeze and suspend all increases in salary or wages of its employees for a period of no more than one year. No retroactive pay adjustments may be made at the conclusion of the ~age freeze.

Section 4 - Sets the enacting date and sunset date of one year.

Justification

Real Property Taxes in New York State are too high, and the burden they place upon citizens, homeowners and businesses, is making it difficult for New York State to thrive, prosper and succeed. The only way to realistically reduce the real property tax burden upon our citizens, homeowners and businesses, is to place a comprehensive approach in State law which controls costs and spending for local governments, and provides significant mandate relief with respect to their fiscal obligations. Real property tax relief and local government mandate reform must be achieved by establishing a comprehensive approach to reduce real property taxes across the state, the controlling government costs, and providing significant mandate relief to local governments.

In recognition that New York State has been impacted by the national recession, a fiscal emergency currently exists. A structural imbalance has contributed to New York becoming one of the highest taxed states in the country. During this time of fiscal crisis, the State and local municipalities are experiencing extreme pressures to continue to provide adequate infrastructure and core services to their residence while also keeping taxes reasonable and affordable. A combination of enhanced budgetary discipline and short-term budgetary relief is necessary to

assist the state, and local governments and the taxpayers of both to facilitate a return to economic stability.

Even while experiencing significant revenue declines and increasing costs in pensions and health insurance that are largely unavoidable, both the state and municipalities are locked into multi-year collective bargaining agreements that require temporarily unaffordable salary increases. Even if there is no contract currently in effect, step increases must still be granted due to the Triborough Amendment. consequently, while private sector employers may avoid layoffs by freezing salaries, local government employers have no such option. This legislation would provide the state and its local governments with the ability to impose a wage freeze for a period of one year, giving them greater ability to address the fiscal challenges they are confronting, without having to dramatically reduce their workforce or curtail essential municipal services.

Prior legislative history

This is a new bill.

Fiscal implications

Cost savings to New York State and Local Governments.

Effective date

This act shall take effect immediately and shall expire and be deemed repealed one year after effective date.