Health care and pension costs are the chief reasons for Essex County’s projected $56 million budget shortfall next year, says Essex County Executive Joseph N. DiVincenzo, Jr. And yesterday in Newark, he unveiled a plan to reduce that shortfall by making county workers pay more for their benefits–a lot more.
County workers, like state government workers and teachers, now pay just 1.5% of their salary for their health care premiums. That tab raises only about $4 million for Essex County, not nearly enough to match its skyrocketing costs: The county’s health care premiums will jump $9.2 million next year, to a staggering $72 million.
What DiVincenzo wants instead is something more akin to the private sector, where costs vary according to salary and the type of coverage chosen. Under his proposal, employees earning $50,000 or less would pay 10% of their health premium, while those making $70,000 to $150,000 would kick in 20% and anybody over $150,000 pays 25%. DiVincenzo says that a his approach would generate $6.7 million. As for pensions, DiVincenzo asked that the state revisit its calculations, which currently will lead to a $12 million increase in the county’s pension contribution next year, triple its usual rate of increase. (The state has also raised Verona’s tab for school and municipal employee pensions.)
But rather than just negotiate his way to a new benefits plan with the unions, DiVincenzo is asking the state legislature to make it law. And that led to a rather surreal moment yesterday. Richard Codey, the Democratic state senator who represents Essex County and whose name DiVincenzo put on a skating arena, complained to the Star Ledger that the plan would cost workers too much and that requiring legislative action was the wrong approach.
Legislative reform can be a long, slow route to change, something the county executive has all but acknowledged in recent weeks. DiVincenzo mandated that county agencies submit proposed 2011 budgets that were 10% below 2010 levels and, this past Monday, he said that further cost-cutting measures would be considered, including layoffs and furloughs.
