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NY’s Pension Bomb, the ongoing Public Sector Union problem, need for reforms linger.

April 1, 2011

Steven Malanga talks with Josh Barro about his new article, “Rahmbo Takes on Public Worker Unions.”

Article: Collective Bargaining Doesn’t Work In the Public Sector, Steven Malanga

Malanga is the author of SHAKEDOWN: The Continuing Conspiracy Against the American Taxpayer

Shakedown: The Must-See Video on the Influence of Public-Sector Unions


Step increases, should they stay or should they go?

March 23, 2011

We reported a few weeks back that 50,000 members of PEF and CSEA are due to receive pay increases for longevity, which Gov. Andrew Cuomo said Tuesday he is trying to negotiate away.

Should workers get the payments? Their argument is that people are hired at a rate less than the “job rate,” which is only attained after seven years. Legally, of course, this has all been negotiated into a labor contract. No one in New York has figured out a way to really annul that, despite noise made last year by Gov. David Paterson. UPDATE: I should clarify, per a reader’s point. No way to annul this without repealing the Triborough Amendment, a provision of the Taylor Law which says the provisions in contracts — including step increases — remain in effect after their expiration. Conservatives, including Carl Paladino, have called for this.

The other argument, though, is that this could save money and be counted toward the $450 million Cuomo has booked in his budget in savings from the unions. If that number isn’t reached, the balance will be made up for in layoffs — as many as 9,800.

Curbing Union Excess
Nicole Gelinas, New York Post, 03-14-11

New York pols aren’t about to eliminate most collective-bargaining rights and automatic dues collection for public-sector unions, as Wisconsin just did. But if they care about the public good, they could take some baby steps to show that they’re not entirely in the pockets of union labor.

Union Power Comes in Many Forms
Steven Malanga, City Journal Online, 03-06-11

When the skyrocketing cost of public employees’ salaries and benefits helped push New York City to the brink of bankruptcy in the mid-1970s, state and local officials put together a bailout that reduced pension and benefits packages for Gotham’s workers.

Cuomo’s Tied Down
E.J. McMahon, New York Post, 02-27-11

In the more than 40 years since the enactment of the Taylor Law, which mandated collective bargaining for all public sector employees in the Empire State, unions representing those workers have evolved into a virtual fourth branch of government here.

New York State Pension Bomb - A Resource Site For Taxpayers

Sponsored by the Empire Center for New York State Policy

State and local government employees in New York collect taxpayer-guaranteed pension benefits that are far more generous than those available to most private-sector workers.

(Use this calculator to see just how generous those benefits can be.)

The cost of public pensions is about to blow through the roof, with financial consequences that could affect generations of New Yorkers to come. And it’s not just pensions: state and local governments have promised over $200 billion in post-retirement health care — but set aside no money to pay for it.

To learn more about the problem:

  • Search the pension database of more than 340,000 retired state and local government employees at
  • Read “Iceberg Ahead, ” the Empire Center’s study of unfunded government retiree healthcare obligations.
  • Join our email list and keep up to date with the latest on this and other Empire Center reports and projects.
  • Visit Public Sector Inc., the Manhattan Institute’s website focusing on the national problem of burgeoning liabilities for government employee pensions and other compensation.
  • Times: NY’s public pension benefits rank high

    New York’s state and local governments offer the nation’s second highest “pension replacement rate” — the percentage of preretirement income covered by an employee’s pension — according to a new study cited in today’s New York Times.

    Empire State Pensions Go “Boom”

    Taxpayer-funded employer contributions to public pensions in New York State will rise by billions of dollars in the next few years, threatening to divert scarce resources from other essential public services in the midst of a fiscal crisis, according to a new report from the Empire Center for New York State Policy.
    New York’s Exploding Pension Costs,” by E.J. McMahon and Josh Barro, forecasts pension funding trends for the New York State and Local Retirement Systems (NYSLRS) and the New York State Teachers Retirement System (NYSTRS), which cover nearly every public employee outside New York City. It also summarizes official reports of funded status and projected costs over the next three years for the New York City Retirement Systems.
    The pension report was the subject of a YNN Capital Tonight roundtable with report author E.J. McMahon, Westchester County Executive Rob Astorino and Syracuse Mayor Stephanie Miner, below.

    E.J. McMahon discusses the pension report with Joe Specter of Gannett News Service:

    March 3, 2011

    Public Payroll Watch

    Tim Hoefer

    Governor Cuomo proposed a cap on Superintendent salaries earlier this week, but as it relates to bringing school district spending down, it’s the equivalent of trying to chop down a tree with nail clippers.


    March 2, 2011

    Mandate relief still kicking around

    E.J. McMahon
    Although his proposed property tax cap will put pressure on counties, municipalities and schools to reduce their costs, Gov. Cuomo has punted the related issue of mandate relief to a “redesign team” comprised of stakeholders including representatives of local governments (which really need and want mandate relief) and public employee unions (which oppose any mandate relief that affects their members; i.e., any meaningful mandate relief at all).
    Late yesterday, the Mandate Relief Redesign Team — or, more accurately, its coaches and trainers in the governor’s office — issued a report that essentially punts the issue back to … the team itself.
    In the meantime, the hopelessly divided “Team” seems destined to spend a lot more time scrimmaging around the 50-yard line.  The Triborough amendment and employee benefits, to cite just two factors driving up local costs, were mentioned by the report in passing, only as “complex issues” requiring further study.
    Repealing New York’s Triborough Amendment is ‘Core Reform Issue in State’
    New Yorkers for Growth
    Wednesday, January 19, 2011New York, NY-Jan. 19…New Yorkers for Growth , a leading voice for responsible fiscal policy in New York State, today announced its chief legislative priority for 2011: repealing New York’s Triborough Amendment which has unfairly added millions of dollars in extra costs to state, county, and local governments, the group says.
    NYFG: ‘Double Dipping’ Officials are Bilking New York Taxpayers and Exploiting Pension System
    New Yorkers for Growth
    Wednesday, December 15, 2010New York, NY–December 15….New Yorkers for Growth, a political action committee dedicated to returning New York State to firm fiscal footing, today condemned the “double dipping” pension loophole allowing state officials to collect pension checks while still in office in light of today’s New York Post story (linked here) revealing nearly a dozen state lawmakers-Democrats and Republicans–engaged in the practice.
    Taylor Made: The Cost and Consequences of New York’s Public-Sector Labor Laws
    by Terry O’Neil and E.J. McMahon

    Defusing New York’s Public Pension Bomb: A Fair Approach for Workers and Taxpayers

    Early retirement for state workers: Money-saver, or costly sweetener?

    Volatility, thy name is “income tax”

    States are finding it more difficult to accurately predict their revenues–and “the biggest culprit” is an increasing reliance on personal income taxes, according to a new report from the Pew Center on the States and the Nelson A. Rockefeller Institute in Albany.



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