E.J. McMahon is a senior fellow at the Manhattan Institute for Policy Research and its Albany-based Empire Center Show More
Suffolk County's proposed contract with the county Police Benevolent Association, featuring an extraordinary 10-year term, calls to mind the New York Yankees' equally long 2007 deal with Alex Rodriguez.
The Bronx Bombers paid dearly to own A-Rod's production in his prime -- and sure enough, he helped them win a world championship early in the bargain. Now, however, they are still on the hook for roughly $100 million owed to an aging slugger who may not be hitting his weight by 2017.
In Suffolk's PBA pact, the upfront equivalent of a World Series win for County Executive Steve Bellone is the PBA's agreement that new police officers will pay 15 percent of their health insurance premiums -- something other county unions are accepting as well.
From Bellone's perspective, other home runs in the PBA contract are a provision freezing the starting salary at $42,000 through 2020, and a big stretchout of the police pay scale, so that new officers will take 12 years, instead of the current five, to reach the top. There's also an overdue change to the procedures for determining on-the-job disabilities.
But what about the back end of the deal? A prolonged period of slow economic growth, including another recession, is entirely possible in the next eight years. That would plunge the county even deeper into the red. But the largest segment of the county operating budget will be untouchable -- because, as part of the contract, Bellone has agreed to a no-layoff clause.
Sure, when it comes to health insurance, something is better than nothing, but 15 percent is still a lot less than most private sector workers pay. It's also less than the 25 to 31 percent that state workers pay for their family coverage.
And this part can't be emphasized enough: Only new hires will be contributing anything. Suffolk's current cops -- among the best paid in the world, with average salary, overtime and extras adding up to $136,000 a year -- have given up virtually nothing in the midst of a supposed financial emergency.
After a three-year base pay freeze, police will get a 24-percent base pay hike from mid-2013 through 2020. For officers now already on the top step, a boost in automatic longevity increments will bring the total raise to 30 percent -- an annual average of nearly 4 percent over seven years.
So, for today's Suffolk PBA members, the only real risk in a long-term deal is a resurgence of inflation, which has averaged just 2.4 percent in the past eight years. But even in that worst-case scenario, they can still look forward to retirement with generous pensions after just 20 years, plus accrued sick leave payouts that averaged $81,000 per officer, as of a few years ago. They and their spouses also are assured of continuing taxpayer-funded health insurance for life -- contributing to the county's nearly $4 billion unfunded liability for post-employment benefits.
And to top it off, all PBA members, current and future, will enjoy the immensely valuable benefit of ironclad job security for the life of the contract.
So why did Bellone let them off the hook so easily while accepting the clear financial risks of such a long-term deal? The answer can be summed up in one word: arbitration. He's calculating that this agreement, with all its pluses and minuses, is preferable to the likelihood of yet another binding arbitration award giving Suffolk cops a series of 3 percent (or more) pay hikes with no change to the status quo.
As I've previously noted in this space on the subject of Nassau County's costly cops, the law allowing police and fire unions to force arbitration of their contracts is due to sunset next July 1. A suggestion for Gov. Andrew M. Cuomo: When the Legislature sends you a routine extender of the law, send it back unsigned -- with Steve Bellone's phone number on top.
E.J. McMahon is senior fellow at the Manhattan Institute's Empire Center for New York State Policy.