Gov. Andrew Cuomo said a bill that would help struggling local governments during binding arbitration with unions is an “opportunity” for the state to address municipalities’ fiscal grievances.
A law is set to expire in June that allows municipalities and their police and fire unions to go to binding arbitration when the parties can’t agree on a contract renewal. Cuomo wants to tweak the process so arbitrators take into consideration local governments’ fiscal struggles.
The governor also plans to create a state financial restructuring board to address local governments’ specific financial stressors.
“We have to restructure those local governments so they’re financially solvent,” Cuomo said during a Manhattan news conference Thursday. “I have not wanted to subsidize the problem; I actually want to solve the problem.
“I’m not going to facilitate the continued insolvency by giving them an annual subsidy so they go from hand to mouth,” he continued.
Cuomo has yet to propose the binding arbitration bill, and the details are still being negotiated.
But in the governor’s proposed budget, he included provisions that would have required arbitrators take into consideration municipalities’ “ability to pay” when deciding whether to allow personnel costs to grow. The proposal also included a 2 percent cap on growth if a municipality met a standard of being fiscally “distressed.”
Those changes did not make it into the final budget, which was approved in late March.
“There is a bill that the Legislature is interested in called binding arbitration for police and fire unions,” Cuomo said Thursday. “This has started the topic, and I think it’s an opportunity for us to actually do something real.
“Local governments that are in financial distress can come before the board, and this board will work with them to restructure the government so it’s economically viable,” Cuomo continued, “and part of that would be working out the contract with their police and fire.”
As he has said in the past, Cuomo stressed that local governments need to make difficult decisions to balance their budgets like the state has had to in recent years. He suggested considering mergers, consolidations and shared service agreements.
“It’s going to be that kind of outside the box thinking,” Cuomo said. “And it’s hard, and it makes people uncomfortable, but the status quo doesn’t work.”