NPR Provided a Clue About Coming Albany Moves

[Elwood Community Network commentary distributed 3/2/11]

While doing today's [i.e., March 2nd] morning exercises, I was listening to NPR and heard a brief story on public pension changes being considered by Governor Cuomo. As that would be a big factor in moving toward reducing cost burdens for school districts and other local government entities, I did a bit of internet research and found a posting on the website of the Albany Times-Union.

The story begins with the following two paragraphs:

"Watch for a Tier 6 public employee pension proposal from Gov. Andrew Cuomo as part of a sweeping effort to reduce the cost of mandates on state and local government including those that govern employee compensation.

“I believe he will be presenting something in the near future,” Cuomo’s Senior Advisor Larry Schwartz said of a Tier 6 plan which presumably would be less generous than the Tier 5 plan pushed through by former Gov. David Paterson."

There was also a brief discussion of positions related to defined benefit vs. defined contribution pension plans, as well as the rather infamous Triborough Amendment.

You may read the full story at the following web page:
http://blog.timesunion.com/capitol/archives/53971/tier-6-proposal-may-be-on-tap/

Now, this kind of move to create a Tier 6 pension category could be good news for fiscal sanity in New York, but I hope that the Governor, and his increasingly close friends in the Legislature, don't try to portray that as an "answer" for the totality of the increasingly-out-of-control public pension system that imposes ballooning costs on school districts.

It's nice to make changes going forward, but it might take decades, not weeks or even years but decades, for that to have any substantial benefit for school districts.

I then discovered another internet gem at the Albany edition of The Business Review website, where they discuss -- very briefly -- the just-released report of a mandate commission for the Governor, and there are some interesting indicators in their story:

"The mandate commission's March 1 report offers a mixed bag of ideas. Among them: A ban on any new state mandates unless they're fully funded....The report doesn't address laws business groups have blamed for locking the state, local governments and schools into mandatory pay and benefit increases for their workers after a contract has expired....Municipal and school officials have called for changes to those laws to help them control costs....It's unclear what recommendations Cuomo will try to include in his budget proposal. He has until the end of this week to amend it."

Now, doesn't that sound nice, well, maybe almost nice? Unfortunately, there is that phrase which means that the existing problems -- substantial problems -- are really not being resolved, because the ban would only be on "...any new state mandates unless they're fully funded."

Furthermore, while the commission might suggest that the Governor is serious about preventing future financial albatrosses, how do you feel when you read the next sentence in that brief article?

"A final set of recommendations is due by the end of March 2012."

March of 2012?

2012!

Yet we have heard and seen Cuomo, and some complicit Legislators, proposing compensation restrictions, like one-size-fits-all caps (regardless of the region of the State, or cost of living differences) on the salaries of superintendents and other senior administrators, which have much, much less significance than the costs of those mandates and those State pension burdens (and which would also present dramatically dangerous risks to the viability of competently managing school districts) as if that was the magic bullet for school district finance.

We have heard Cuomo and his cronies talking about capping administrator salaries, instead of seriously tackling the economic absurdity of having 124 school districts total between Nassau and Suffolk Counties (and something like 700 districts in all of NY State).

Just start multiplying the compensation costs of one superintendent and several assistant superintendents against 124, and come up with an estimate for total costs. If school districts were consolidated on the basis of counties, there would be two superintendents, and a requisite number of asssistants, and the savings would be dramatically large. Even if they were simply consolidated on the basis of towns, there are ten Towns in Suffolk and three Towns in Nassau, so you would have thirteen superintendents and again a significant number of assistants, but the total savings would still be dramatically large, even if not as large as consolidation on the basis of counties.

So, let's hope that Mr. Cuomo and Mr. Raia and other members of the Assembly and State Senate stop proposing risky and fiscally insignificant measures, which are little more than Red Herrings to deflect attention from the problems which they or their predecessors have created for us, and let's have them get serious about the massive existing burdens which Albany caused.

And let's find the solution for those burdens now, and not twelve months from now.

You may read the entire story at the following web page:
http://www.bizjournals.com/albany/morning_call/2011/03/cuomo-releases-report-on-mandate-relief.html