New Jersey towns fear losing a 2 percent salary increase cap on police and fire contracts

Local government officials in New Jersey are urging Governor-elect Phil Murphy to support permanently extending the 2 percent cap on police and firefighters salary increases when contract disputes go to binding arbitration.

The cap is set to expire at the end of the year and Democratic legislative leaders are waiting to hear whether Murphy supports it before taking action to extend it.

Murphy is awaiting a final report from a commission studying the cap before making his decision.

Republican Assemblyman Declan O’Scanlon doubts that report will ever come.

“This is the first big test of the governor-elect and so far he’s earning a great big F as a grade. He needs to speak out about this. Silence on this issue is just irresponsible,” O’Scanlon said.

Senate President Steve Sweeney says action on an extension could come in the lame duck legislative session IF the commission makes a final recommendation.

“I’m absolutely expecting it. And it would be disappointing it we didn’t get one,” he said.

Local government officials say the arbitration awards cap is a valuable tool to control government expenses.

“For county governments alone that cap has effectively managed the growth of over a billion dollars worth of public safety employee salaries each year,” said Gloucester County Freeholder Heather Simmons, who is president of the New Jersey Association of Counties. “Using interest arbitration as leverage for negotiating more lucrative contracts has no longer been a viable option.”

If the cap is not extended, New Jersey League of Municipalities President James Casella fears local officials will have to cut personnel or services to stay within the mandated 2 percent limit on property tax increases.