S981-2011 Actions

• Jan 4, 2012: REFERRED TO CIVIL SERVICE AND PENSIONS
• Jan 5, 2011: REFERRED TO CIVIL SERVICE AND PENSIONS

S981-2011 Memo

BILL NUMBER:S981

TITLE OF BILL:
An act
to amend the civil service law, in relation to a one year wage freeze;
and providing for the repeal of such provisions upon expiration thereof

PURPOSE:
This bill declares that New York State is currently in a state of
fiscal emergency. To alleviate this emergency, the following bill
would enact a statewide salary freeze for all public-sector employees.

SUMMARY OF PROVISIONS:
Section one declares the legislative findings justifying this bill.

Section two subsection (1)(a) amends the Civil Service Law by adding
a new section 137 which would suspend all increases in salary or
wages of employees of the state, municipalities, and school districts
for a period of one year.

Section two subsection (1)(b) provides that no retroactive pay
adjustment of any kind shall accrue or be deemed to accrue during the
period of wage freeze and no such accruals shall be paid at the time
the wage freeze is terminated.

Section three gives any party in interest a direct appeal to the New
York State Court of Appeals and any such case shall be given
preference over other causes.

Section four provides that this act shall take effect immediately and
shall expire and be deemed repealed one-year after the effective date.

EXISTING LAW:
Precedent for this bill occurred in 2003 whereby the Buffalo Fiscal
Stability Authority Act (BFSA) was adopted and empowered the City of
Buffalo to impose, among other measures, a wage freeze. Prior to
that, in 1975, the New York State Financial Emergency Act was enacted
and authorized New York City's wage freeze. Both wage freezes were
challenged on constitutional grounds and were upheld by federal and
state courts.

JUSTIFICATION:
The State of New York is undeniably in a state of fiscal emergency.
The projected deficit is close to $10 billion. Next year's deficit is
expected to be at least $15 billion with long term deficits nearing
$60 billion. Pension costs continue to increase exponentially and the
federal stop-gap stimulus funding ceases at the end of this year.

The New York State government must take quick decisive action if there
is to be any hope of helping its residents to financially survive and
prosper. Enacting a temporary wage freeze on all public employees is
a realistic and necessary place to start, and one which will generate
significant results.

In fact, school districts would be able to address at least half, if
not more, of their budgetary concerns and could alleviate the need to


raise property taxes. Freezing salaries in school districts would
also result in saving thousands of jobs. For example, a number of
school districts in Nassau and Suffolk Counties have already
voluntarily agreed to make varying concessions to their contractual
salary increases, thus avoiding the need for layoffs.

Enacting a wage freeze at this juncture would realize substantial
savings: NYS, $400 million;
Suffolk County, $65 million; Nassau County, $30 million; The
Metropolitan Transportation Authority, $100 million; New York City $1
billion.

However, this action alone will not completely resolve New York's
fiscal problems, and other important steps will be needed to
eliminate the current deficit and get our state back on the road to
recovery. Admittedly, a long term solution to our fiscal predicament
will necessitate implementing measures that demonstrate real fiscal
discipline, including enacting a state spending cap, reforming the
state's regulatory framework, ending unfunded mandates on schools and
local governments, and providing significant tax incentives to small
businesses that will generate job growth and stimulate the economy.

The continued proliferation of the State's fiscal difficulties
threatens the economic vitality of the entire State. While more
drastic alternatives such as elimination of municipal jobs, school
closures, and elimination of essential services are available, it is
in the best interest of all taxpayers that the State impose a
temporary public employee wage freeze instead. This is a reasonable
and necessary first step towards ameliorating the current fiscal
crisis and a key element in promoting the overall economic and fiscal
stability of the State.

LEGISLATIVE HISTORY:
2010:  S.7940 Civil Service and Pensions

FISCAL IMPLICATIONS:
Substantial savings to state and local governments of approximately
two billion dollars.

EFFECTIVE DATE:
This bill takes effect immediately and shall expire and be deemed
repealed one year after the effective date.

S981-2011 Text

                      S T A T E   O F   N E W   Y O R K
  ________________________________________________________________________

                                     981

                         2011-2012 Regular Sessions

                              I N  SENATE

                                 (PREFILED)

                               January 5, 2011
                                 ___________

  Introduced  by Sen. FLANAGAN -- read twice and ordered printed, and when
    printed to be committed to the Committee on Civil Service and Pensions

  AN ACT to amend the civil service law, in relation to a  one  year  wage
    freeze;  and  providing for the repeal of such provisions upon expira-
    tion thereof

    THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
  BLY, DO ENACT AS FOLLOWS:


    Section  1.  Legislative  findings.  The  legislature hereby finds and
  declares that a fiscal emergency exists in the state of  New  York.  The
  state's  fiscal  condition has been significantly weakened by the impact
  of the national economic recession and a phase-down of American Recovery
  and Reinvestment Act funds which will have  a  negative  impact  on  the
  state's  funds. These factors have led to a structural imbalance between
  revenues and expenditures which has contributed to New York becoming one
  of the highest taxed states in  the  nation.  It  is  hereby  found  and
  declared  that  the  state  is in a state of fiscal crisis, and that the
  welfare of taxpayers in the state is seriously  threatened.  The  state,
  its  school  districts and municipalities are experiencing extreme pres-
  sures to continue to provide adequate infrastructure and  core  services
  to its residents while also ensuring that taxes remain affordable. It is
  therefore,  further  found  and  declared that a combination of enhanced
  budgetary discipline and short-term budgetary  relief  is  necessary  to
  assist the state, municipalities and school districts as well as taxpay-
  ers  to  facilitate  a  return  to  fiscal and economic stability, while
  ensuring adequate funding for the provision of essential services.
    S 2. The civil service law is amended by adding a new section  137  to
  read as follows:

    S  137. WAGE FREEZE. 1. NOTWITHSTANDING ANY LAW, RULE OR REGULATION TO
  THE CONTRARY ALL INCREASES IN SALARY OR WAGES OF EMPLOYEES OF THE STATE,
  MUNICIPALITIES AND SCHOOL DISTRICTS WHICH WILL  TAKE  EFFECT  AFTER  THE

   EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                        [ ] is old law to be omitted.
                                                             LBD06203-01-1

 S. 981                              2

  EFFECTIVE  DATE OF THIS SECTION PURSUANT TO COLLECTIVE BARGAINING AGREE-
  MENTS, OTHER ANALOGOUS CONTRACTS OR INTEREST ARBITRATION AWARDS, NOW  IN
  EXISTENCE  OR  HEREAFTER  ENTERED  INTO,  REQUIRING  SUCH SALARY OR WAGE
  INCREASES  AS  OF  ANY DATE THEREAFTER ARE SUSPENDED FOR A PERIOD OF ONE
  YEAR. FURTHER ALL INCREASED PAYMENTS FOR HOLIDAY AND VACATION  DIFFEREN-
  TIALS,  SHIFT  DIFFERENTIALS,  SALARY  ADJUSTMENTS ACCORDING TO PLAN AND
  STEP-UPS OR INCREMENTS FOR EMPLOYEES OF THE  STATE,  MUNICIPALITIES  AND
  SCHOOL  DISTRICTS  WHICH  WILL  TAKE  EFFECT AFTER THE DATE OF THE ORDER
  PURSUANT TO COLLECTIVE BARGAINING AGREEMENTS, OTHER ANALOGOUS  CONTRACTS
  OR  INTEREST  ARBITRATION AWARDS REQUIRING SUCH INCREASED PAYMENTS AS OF
  ANY DATE THEREAFTER ARE, IN THE SAME MANNER, SUSPENDED FOR A  PERIOD  OF
  ONE  YEAR.  FOR THE PURPOSES OF COMPUTING THE PENSION BASE OF RETIREMENT
  ALLOWANCES, ANY  SUSPENDED  SALARY  OR  WAGE  INCREASES  AND  ANY  OTHER
  SUSPENDED  PAYMENTS  SHALL  NOT BE CONSIDERED AS PART OF COMPENSATION OR
  FINAL COMPENSATION OR OF ANNUAL SALARY EARNED OR EARNABLE.
    2. NOTWITHSTANDING THE PROVISION OF SUBDIVISION ONE OF  THIS  SECTION,
  NO  RETROACTIVE PAY ADJUSTMENTS OF ANY KIND SHALL ACCRUE OR BE DEEMED TO
  ACCRUE DURING THE PERIOD OF WAGE FREEZE, AND NO SUCH ADDITIONAL  AMOUNTS
  SHALL BE PAID AT THE TIME A WAGE FREEZE IS LIFTED, OR AT ANY TIME THERE-
  AFTER.
    S  3.  If any section, part or provision of this act shall be adjudged
  unconstitutional or invalid or ineffective by any court of  this  state,
  any  party  in  interest  shall  have a direct appeal as of right to the
  court of appeals of the state of New York, and such  appeal  shall  have
  preference  over  all  other causes. Service upon the adverse party of a
  notice of appeal shall stay the effect of the judgment or order appealed
  from pending the hearing and determination of the appeal.
    S 4. This act shall take effect immediately and shall  expire  and  be
  deemed repealed one year after such effective date.