NJSBA and three other public sector management organizations this week renewed their calls to Governor Corzine to support changes in public employee health benefits that were recommended through the Legislature’s special session on property tax reform.

The changes, reflected in S-40/A-2, would enable schools and local governments to attain substantial cost savings and, as a result, reduce local property taxes, according to the coalition of associations representing municipalities, local school boards, county colleges and county governments.

“Without S-40/A-2, there is very little local government employers can do to control increasing health benefits costs,” the executive directors of the organizations stated in a letter to Corzine last month. “The losers in this situation will be local property taxpayers.”

Edwina M. Lee signed the letter on behalf of NJSBA.

Hands Are Tied Corzine has adopted the position that employee benefits reform must take place through the collective bargaining process. Under current law, this approach would help state government, but “there is a fundamental flaw…when it is applied to health benefits provided by local government employers,” according to the four organizations.

Unlike the state government, “municipalities, counties, school boards and county colleges that participate in the State Health Benefits Program are prohibited from bringing health benefit issues to the collective bargaining table,” the coalition leaders stated in their December letter.

“Thus, no matter how successful the State is in its collective bargaining with state employee unions, it will not help local government employers at all unless current laws governing the State Health Benefits Program are changed.”

Cost/Tax Savings In addition to NJSBA, the coalition includes the New Jersey State League of Municipalities, the New Jersey Council of County Colleges and the New Jersey Association of Counties. The groups are seeking changes in state law to give local public employers the ability to negotiate cost-containment provisions that are common in the private sector and are already available to state government.

These strategies include –

• Permitting negotiations with employees over premium sharing. Currently, restrictive law and regulation require local governments and school districts in the State Health Benefits Program to pay the full cost of employees’ coverage.
  
  
• Allowing variations in levels of coverage for different classifications of employees, based on date of initial employment, salary and other factors. Current regulations make it virtually impossible to attain any cost containment when a public employer must negotiate with multiple bargaining units.
  
  
• Offering incentives to discourage duplicate coverage. Current law precludes school districts, which constitute the largest groups of local public employers, from offering incentives to employees to waive coverage if they are covered under their spouses’ plans.