Steve Levy: Albany will betray taxpayers by undoing Tier 6 reforms

By Steve Levy

Our Center for Cost Effective Government just published a white paper on why political donations from municipal unions to officials who negotiate with those unions should be illegalin the public sector, as it is in the private sector.

If ever there were an example of why such legislation is so desperately needed, it is certainly the latest attempt by big-spending state legislators of both parties who are seeking to reverse the Tier 6 fiscal reforms implemented in Albany in 2011.

Those reforms, which kicked in back in 2012, were designed to address the pension time bomb that is ready to explode in New York. The enormous pension obligations burdening the state’s taxpayers are among the highest in the nation. They are largely responsible for the enormously high property taxes we are forced to pay.

It was understood that the Legislature had given the store away in the past, and that changes had to be made before we fell off a fiscal cliff. The Legislature did not have the intestinal fortitude, and often lacked the legal flexibility, to address the massive benefits that were heaped on state employees at the time. Consequently, legislators took an easier way out by requiring incoming employees to pick up a fair share of their pension contributions, while also making them wait longer to access their pensions, and limiting their ability to inflate their pensions by working huge amounts of overtime in their last few years.

In a previous white paper, our center included that New York taxpayers would save $50 billion to $80 billion if overtime were simply removed from pension calculations starting in 2022.

Those reforms never happened, of course, but the 2011 reforms did. They won’t save the day, but they delayed the detonation of the time bomb.

But lo and behold, the liberal spenders are trying to undo these reforms to placate their union benefactors. Just last month, Gov. Kathy Hochul appeared before a union rally, committing to eviscerate the fiscal reforms her predecessor Gov. David Paterson implemented. Her selling out of taxpayers may get her waves of votes from her union benefactors, but it will impose billions of dollars in new obligations on schools and local governments, thereby causing our already sky-high property taxes to rise even further.

This massive capitulation by the governor comes just a year or two after she and the Legislature agreed to sweeten government employee pensions by calculating them based on the average of the three highest years of earnings, which would be a higher number than the previous five-year average.

Proponents of eroding the Tier 6 reforms falsely claim that the state has been unable to hire teachers, police officers and other public-sector employees because of these changes. That’s nonsense. The line is still out the door to get a teaching or police-officer job, especially on Long Island. (If there was a decline in police recruiting in cities, it was because of the anti-police attitude that emanated from Mayor Bill de Blasio and others on the liberal end of the spectrum.)

Also disturbing is the fact that many Republicans are just as bad as the Democrats. Take, for instance, a Republican senator from Long Island who has been making excuses to make these changes, dismissively claiming that the Tier 6 taxpayer protections were “bad public policy” and that revoking the reforms “won’t bankrupt the state.”

There are a few true fiscal conservatives, such as Assemblyman Michael Fitzpatrick, who won’t back down to this pay-to-play mentality in Albany. But they are few and far between.

Taxpayers should look very closely at how their legislators vote on this proposal. According to the Manhattan Institute’s Ken Girardin, reversing the 2011 fiscal reforms would wind up costing property taxpayers upward of $100 billion. That’s billion with a B.