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Editorial: Don't rush new Nassau County labor contracts

NIFA Chairman Jon Kaiman, center, during a meeting

NIFA Chairman Jon Kaiman, center, during a meeting of the NIFA board in Uniondale on Dec. 30, 2013. Credit: Newsday / Thomas A. Ferrara

There's something off-balance in the negotiating process between Nassau County and the unions that represent its municipal employees. So it's no surprise that the attempt to lift a 3-year-old wage freeze was going up and down like a seesaw last week after the Nassau Interim Finance Authority rejected a deal the two sides had worked out. The negotiators then worked into this weekend to fashion another.

What remains a constant is County Executive Edward Mangano's failure to realize he should have used the NIFA wage freeze to restructure contracts when it was first imposed in 2011, not on the eve of a NIFA vote for a fourth consecutive freeze. That time would have been better spent trying to balance the books, to free the county from its state-mandated fiscal baby-sitter.

Instead, during this time, Mangano and his advisers have labored shoulder to shoulder alongside union negotiators to get workers everything they can while asking Gov. Andrew M. Cuomo to select a new NIFA chairman who would be more amenable to lifting the wage freeze.

But even Jon Kaiman, the former North Hempstead supervisor who now heads NIFA, hasn't been able to stop Mangano from trying to give away the taxpayers' candy store. NIFA is still the only force raising a finger to stop deals the county simply cannot afford.

It happened again last week. Nassau's unions, led by the Police Benevolent Association, reached general agreements with the county on how to lift the freeze and structure pay and benefits for about 7,000 employees through 2017.

The deals were supposed to conform to NIFA guidelines that would make them fiscally acceptable. But when NIFA board members and their lawyers looked over the vague proposals, they saw caveats the county couldn't afford and they couldn't approve.

For example, the proposed agreements would have allowed the unions to collect retroactive compensation the county can't afford if the unions prevail in an appeal of a lawsuit on the legality of the wage freeze.

In another example, the deal said the question of making current employees contribute to health care benefits could not be brought up again until 2020, three years past the proposed contract's end. That would mean workers who retire by 2020 would collect free health care forever after.

These provisions, among others, could have cost the county hundreds of millions of dollars, but Mangano let them go by. And the county didn't even push for better terms after a major court victory last week established the legality of the freeze.

NIFA imposed a control period and wage freeze in 2011 to deal with mounting revenue shortfalls for which Mangano had no remedy, other than unrestrained borrowing. The moves have saved Nassau about $230 million and likely kept the county from running out of cash.

The county was supposed to use the breathing room bought by the freeze to straighten out its finances. Instead, the annual deficit sits stubbornly around $80 million to $100 million. The assessment system remains broken, property tax refunds cost about $80 million a year, and the county's debt, now over $3 billion, keeps mounting. The county rescinded a home energy tax that would have brought in $40 million annually, preventing a NIFA control period. And no property tax increases have been levied since Mangano took office in 2010, although even a 2 percent annual hike would have solved most of the county's fiscal woes.

The unions say they have a right to the wages and benefits the county contracted to give them. They also argue that at some point the wage freeze will become illegal because the county has done nothing to fix its finances, has put forth bogus claims of a budget surplus and has raised the pay of some nonunion employees. The unions are right.

But that doesn't mean the county, the unions and NIFA need to rush into incredibly complex deals with vaguely understood agreements, little financial analysis and new caveats that pop up like dandelions after a spring rain.

If agreements are reached, they will only be preliminary. Their financial impacts must be assessed by the legislative budget office, the county legislature must vote and NIFA must give each contract final authorization.


Slow down. Get it right.

NIFA must stay vigilant, and Mangano must get vigilant. The math needs to be clear for officials and taxpayers. And there must be sufficient time for review before votes by the legislature and NIFA.

The county agreed to accept a control board nearly 14 years ago when it teetered on the brink of bankruptcy and needed a $100-million bailout from the state. There's no need to rush the analysis of whether any of these deals can help fix the problem.