The New Jersey State AFL-CIO supports this legislation and respectfully asks for your support in the Senate Labor Committee scheduled for May 8, 2023. The bill requires a cost analysis to examine the impact on workers and taxpayers prior to awarding a contract to privatize public services.
Regardless of philosophical positions on privatization, whether in support or in opposition to the concept, we can all agree that the interests of three groups– taxpayers, residents and employees – must be front and center when considering the merits of privatization. After all, these are the people who depend on the delivery of these services, depend on them as a means of making a living, and of course, pay for them. The legislation before you today seeks to implement best practices for the benefit of all three of these categories of stakeholders.
It is important to note that this legislation does not forbid the privatization of services, rather, it puts in place common sense mechanisms to ensure that savings promised to taxpayers actually materialize. This is achieved by the bill’s requirement that the state agency with jurisdiction over the contract perform a cost analysis to confirm the anticipated savings presented by the private proposal. This analysis would be a requirement prior to the approval of the contract.
Furthermore, the bill requires procedures that promote transparency in the contracting process, including making the proposal available to the public. It also has employee protections, such as establishing a “floor” of wages and benefits under the new private contract that are comparable to existing benefits and compensation rates. This ensures that contracts are not privatized because of simply reducing compensation for workers.
Finally, the bill protects taxpayers by assuring that user fees aren’t added above the contract cost and requires that staffing levels are maintained. This helps protect against surprise billing of consumers to subsidize the privatized contract as well as assuring that private contractors simply don’t reduce services to lower their bids.
This legislation is a commonsense approach to ensure that taxpayers, employees and residents all benefit if a contract is privatized. We respectfully ask for your support.