Playing with other people’s money

DSCN0328 Pushback by Atlantic City’s police and firefighter unions will likely be the single biggest impediment to the financial rescue of the city. The unions cannot – must not – be allowed to win this fight. And the only questions are: How long will the battle take and how ugly will it get?

I don’t share the current animosity toward unions, and public-employee unions in particular. Unions do what unions do – advocate for their members. The problem with public-employee unions – that is, the advantage public-employee unions have – is that the people sitting across from them at the negotiation table are playing with other people’s money.

A 2010 analysis by The Star-Ledger found that the average municipal cop in New Jersey is paid 80 percent more than the average resident, and three of 10 made at least $100,000 last year. The problem is particularly acute in Atlantic City, where salaries of police officers and firefighters are exceptionally high. And the problem is particularly acute in Atlantic City today because the resort is on the verge of financial collapse.

Atlantic City is like a household whose income has been cut by more than half but has not changed its lifestyle accordingly. The city’s primary “income” is the property taxes paid by the resort’s casinos, whose values have plummeted as casino revenue has declined. According to emergency manager Kevin Lavin’s March 23 report, the city’s tax base has declined from $20.5 billion in 2010 to $7.3 billion in 2015, a 64 percent drop. And Lavin dryly noted, “The city’s spending has not kept pace with this decline.”

The immediate problem is reducing the city’s expenses by $10 million in 2015. And that cannot be done without cutting public-safety personnel expenses. There must be fewer police officers and firefighters in Atlantic City; they must make less money; they must have less lucrative benefits.

Said Lavin: “In short, the acute financial distress facing the city is imminent and the causes of such distress are not transitory. Absent an urgent, material realignment of revenues and expenses, this crisis will rapidly deepen and will threaten the city’s ability to deliver and maintain essential government services impacting the health, safety and welfare of its residents.”

In a Feb. 16 letter to The Press of Atlantic City, resort resident Steven Price argued that maintaining teacher salaries was more important than maintaining police and firefighter salaries:

“The quality of the schools in a town is always one of the top three reasons why families with children move to a particular area. Conversely, have you ever heard someone say that they moved to a particular town because the firefighters there make $95,000 a year? …

“With 8,000 laid-off casino employees, don’t you think any one of them would work as a firefighter for $10 per hour if given that chance? There would be a line three or four blocks long if you advertised the hiring of 300 new firefighters at $10 per hour but with the perks that current firefighters enjoy. Likewise, if you adjusted the police salaries and made them more in line with the private sector, you could actually afford a large police force to make our town safer.”

Price couldn’t be more correct. And sadly, he noted in a subsequent March 18 letter that “numerous Atlantic City firefighters … sent hostile and threatening messages” to him and his family after the first letter.

If the city’s public-safety unions and rank-and-file police and firefighters plan to approach the coming changes with that kind of arrogance and bullying, this is going to get very, very ugly. But ultimately the unions will lose this fight – possibly by the realization of their worst fear, a regional police force as was created in Camden. That’s because they must lose for the city’s taxpayers – residents and casinos alike – to win.

Jim Perskie is the former editorial-page editor of The Press of Atlantic City.

Playing with other people’s money