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* Pay Increases and Pink Slips


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Mayor Raymond McDonough announced that forty eight town workers will be laid off as a result of former Governor Jon Corzine cutting 5 million dollars in distressed city aid to Harrison and increasing insurance costs. The lay offs are suppose to save the town $2.1 million.

The layoffs come in the same week that the Mayor and Council voted at a Special Dr. Martin Luther King Jr. Meeting held on Monday, January 18, 2010 to increase town worker salaries by 3.5 percent each of the past three years (2007, 2008, and 2009).

If the Red Bulls make their first of their quarterly property tax payment in two weeks, the town will be on track to making up some of the 5 million dollars it has lost from the loss of distressed city aid. In a press release Mayor Raymond McDonough stated that "The taxpayers of Harrison cannot be called upon to pay additional local property taxes to replace the lost state aid."

Local business owners may find it strange that the McDonough administration started out the week giving pay increases to town workers only to turn around in the same week and hand out pink slips. When is the last time a private company announced salary increases and then laid off employees? Unheard of. Government however operates under different rules. Town employees expected pay increases and Mayor McDonough delivered those pay increases. Those with seniority are not affected by the laying off of their fellow town workers. I stated in prior posts that a pay increase would result in layoffs. It was abundantly clear that the taxpayers of Harrison would and could not support another tax increase. They may have to endure a large tax increase even with additional town worker layoffs because the Town of Harrison is facing more than one economic storm.

The town must make a 3.5 million dollar interest payment on the Red Bulls Stadium bonds. Councilman Steve McCormick questioned Mayor McDonough about how the town was going to meet its interest payment obligation. Mayor McDonough stated that he was working on it.

In addition, the town is likely to have its Abbott District school funding cut. Every dollar cut in Abbott Funding will add that amount that must be raised in property taxes to fund the school district. The Board of Education and Councilman/Superintendent of Schools James Doran must start now looking at cutting costs in the town's schools. Mayor McDonough appoints the school board members so he should have some control over the school budget.

The Jersey Journal reported on the lay offs and mentioned the freezing of town worker salaries for 2010 and 2011. The article failed to mention that the town gave 3.5% pay increases for years 2007, 2008 and 2009. I found that to be a interesting fact to miss. The names of the employees given layoff notices were also not released. Let's hope that the layoffs were based on union layoff guidelines (rules) rather than on other factors. Avoiding litigation and the increased legal fees associated with defending lawsuits is crucial to keeping costs down.

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